FBI Probes Pentagon Official Accused of Spying for Israel
By Bradley Graham and Thomas E. Ricks
Washington Post Staff Writers
Friday, August 27, 2004; 9:45 PM
The FBI is investigating a mid-level Pentagon official who specializes in Iranian affairs for allegedly passing classified information to Israel, and arrests in the case could come as early as next week, officials at the Pentagon and other government agencies said last night.
The official under investigation wasn't named by those familiar with the situation, but was described by them as a desk officer in the Pentagon's Near East and South Asia Bureau, one of six regional policy sections. The official under scrutiny was described as a veteran of the Defense Intelligence Agency who moved to the Pentagon's policy branch three years ago and had been nearing retirement.
One government official familiar with the case said it isn't yet clear whether the charges that are brought will extend to espionage. So far, he said, the FBI investigation has involved lesser allegations of mishandling of classified information and making unauthorized disclosures.
The investigation has been underway for more than a year. Defense Secretary Donald H. Rumsfeld and top Pentagon lawyers were informed of it some time ago, officials said. But many other senior Pentagon officials expressed surprise at the news when it was first reported last night on CBS.
Pentagon officials sought to minimize the significance of any sensitive information the suspect individual may have wrongfully passed. "The Defense Department has been cooperating with the Justice Department on this matter for an extended period of time," the Pentagon said in a statement issued last night. "The investigation involves a single individual at DOD at the desk officer level, who was not in a position to have significant influence over U.S. policy. Nor could a foreign power be in a position to influence U.S. policy through this individual. To the best of DOD's knowledge, the investigation does not target any other DOD individuals."
Even so, the case is likely to attract intense attention because the official being investigated works under William J. Luti, deputy under secretary of Defense for Near East and South Asian Affairs. Luti oversaw the Pentagon's "Office of Special Plans," which conducted some of the early policy work for the 2003 invasion of Iraq.
Some critics of the Bush administration have accused that office of distorting intelligence about Iraq in order to improve the case for going to war by arguing that Saddam Hussein's Iraq and al Qaeda were much more closely linked than the intelligence community believed.
Luti reports to Undersecretary for Policy Douglas Feith, who in turn reports to Deputy Defense Secretary Paul Wolfowitz and Rumsfeld.
A law enforcement official said that the information allegedly passed by the Pentagon suspect went to Israel through the American Israel Public Affairs Committee, a pro-Israel lobbying organization. The information was said to have been the draft of a presidential directive related to U.S. policies toward Iran.
In addition to the Pentagon employee, the FBI investigation focuses on at least two employees at AIPAC, the law enforcement official said.
Last night, AIPAC vigorously denied any wrongdoing and said it is fully cooperating with the investigation.
"Any allegation of criminal conduct by the organization or its employees is baseless and false," spokesman Josh Block said in a written statement. "We would not condone or tolerate for a second any violation of U.S. law or interests." He said he had been traveling and so had no additional information on the situation.
Another AIPAC official said: "Our folks are pretty outraged about this. We've had these kinds of accusations before, and none of them has ever proven to be true."
David Siegel, spokesman for the Israeli Embassy, said: "We categorically deny these allegations. They are completely false and outrageous."
Staff writer Dan Eggen and researcher Alice Crites contributed to this report.
? 2004 The Washington Post Company
----------------------------------------------------------------------------

Remote Russian test facility
is again active



Special to World Tribune.com
GEOSTRATEGY-DIRECT.COM
Thursday, August 26, 2004
Activity has been detected at the underground nuclear testing facility on the island of

Novaya Zemlya. The Izvestya newspaper reported on Aug. 16 that there are signs of "new life"

at the facility which has been inactive for the past decade.
About 3,000 military personnel live at the site on one of the most remote parts of Russia.
Vladimir Smetanin, chief of administration at Belushya Guba, the capital of Russia's Central

Nuclear Test Site, said the test site, once in disrepair from Moscow's ratification of the

Comprehensive Test Ban Treaty, is becoming a facility of "federal significance."
The report said the military is being tasked to ensure "nuclear deterrence" and that will

mean more money for development of the facility.
"A nuclear weapon is a living organism," said Ivan Kamenskikh, deputy chief of the Russian

Atomic Energy Agency, in charge of nuclear weapons.
"The processes occurring within the material it contains require constant monitoring. It is

also necessary to monitor the article's other -- mechanical and electronic -- components."
The facility conducts subcritical nuclear experiments designed to simulate a full yield

nuclear blast.
During normal operational conditions, about six subcritical blasts are conducted a year at

Novaya Zemlya.
The report said the new nuclear agency, known as Rosatom, is continuing work on "modernizing

and improving" the Russian nuclear arsenal.
The report quoted one Russian official as saying that Moscow would resume nuclear tests in

the future.
A total of 132 nuclear tests were carried out at Novaya Zemlya since 1955. One was on the

surface, three were underwater, 83 were in the atmosphere, three were on the water surface

and 42 were underground.
The report said the last nuclear explosion at the facility was in 1990.
Copyright ? 2004 East West Services, Inc.

--------------------------------------------------------
Iran claims U.S. invading air space


TEHRAN, Aug. 27 (UPI) -- Five U.S. war planes have trespassed Iranian air space and may have

been testing its air defenses, Iran's official news agency said Friday.
The five planes entered Iranian air space late Aug. 19 from the southwestern Shalamcheh

border and flew over the city of Khorramshahr, the official Islamic republic news agency

said, citing reports earlier this week in the Tehran press.
The daily Seday-e Edalat reported the fighter jets "flew at high speed and altitude, then

headed to the Arvand river. They flew at a height of 10 kilometers (more than 30,000 feet)

and maneuvered over Khorramshahr for a while."
"While the objective behind the fighters' violation of the Iranian air space is not known

yet, some military specialists believe such moves are aimed at assessing the sensitivity of

the Islamic Republic's anti-aircraft defense system," Seday-e Edalat said.
Copyright 2004 by United Press International.
All rights reserved.
------------------------------------------------------
US-Iranian tug and pull over Iraq
By Ehsan Ahrari
The deal struck between the old guard, Grand Ayatollah Ali al-Sistani, and the young guard, Muqtada al-Sadr, on Thursday over the custodianship of the Imam Ali Shrine is also a continuation of the struggle for the future of Iraq.
The old guard is unwittingly giving the US occupation a little space to maneuver, with an understanding that the young guard will not be harmed. Muqtada has apparently agreed to hand over the custodianship of the shrine with a more than tacit understanding that he will be allowed to participate in the Iraqi elections down the road. A five-point plan calls for foreign troops to leave the city and for the Iraqi government to compensate victims of the unrest. What the US may not have realized is that the real struggle about the future of Iraq has just entered another phase.
Through Muqtada, Iran is emerging as a potent power in the political maneuvering with the US over whether Iraq will become some sort of a secular or semi-secular democracy, or an Islamic democracy. Through this, the chances of Iran's preference for the emergence of an Islam-based Iraqi government seem to have perceptibly improved.
The shock and awe aspects of the Bush doctrine in Iraq suffered a serious setback because of the deteriorating security situation, but US aspirations to transform the shape of the political map of Iraq and the larger Middle East remain undeterred. That is one reason why Washington made a very crucial tactical shift from an overall preference for unilateralism to selective application of multilateralism in Iraq, and allowed the United Nations to play a limited role in the formation of the interim government. However, a potent competition between the US and Iran is currently taking place, not only to maintain control over the shape of events in Iraq, but also to determine whether the future elected government there will have a heavy presence and influence of the Islamic or secular elements.
The Bush administration invaded Iraq with a whole slew of shifting strategies and rationales. Ultimately, it settled on the grounds of implanting democracy in that country, and then using that as a "shining" example for the rest of the Middle East. Another explanation was that the road to settlement of the Palestine Liberation Organization-Israeli conflict passed through Baghdad. Once Saddam Hussein was toppled, argued President George W Bush and his national security officials, violence and suicide acts in the occupied Palestine were going to subside. Iran affected all these rationales one way or another, albeit in some instances, its influence was somewhat indirect.
Even the US outlook of implantation of democracy in Iraq went through several versions. First, there was the Pentagon's version of it, whereby the coronation of exile Ahmad Chalabi was to take place as president, right after the cessation of hostilities. Since Secretary of Defense Donald Rumsfeld, his deputy, Paul Wolfowitz - the official part of the Pentagon - and Richard Perle (aka "Prince of Darkness") - the unofficial player, who then served as chairman of the powerful Defense Advisory Board that counsels the Pentagon on defense matters - got most of their first-hand knowledge and a substantial part of their intelligence on Iraq from Chalabi, they bought lock-stock-and-barrel his description of the outcome of the US invasion. According to that portrayal, the invasion of Iraq would be a cakewalk, that the Iraqi troops would lay down their arms and would not fight, and that the American troops would be given a welcome reception of sweets and rosewater.
But when the US invasion was met with stiff resistance - whose intensity kept only escalating with the passage of time - other haphazard measures were introduced. The option of implanting Chalabi was quickly abandoned, and discussions of secular democracy and elections surfaced within the Coalition Provisional Authority (CPA) of Iraq. Then the Iraqi Governing Council was packed with expatriate Iraqis, with the clear intention of using them as leading proponents for secular democracy for their country. Finally, a sort of "exit strategy" was settled on in Washington, whereby a handpicked interim Iraqi government was to take charge leading up to general elections in early 2005. Throughout that course, the American purpose was implantation of a secular democracy, one of whose raison detre was to allow the presence of US forces for an unlimited period. Iraq, under this vision, was to emerge ultimately as a friendly state, even legitimizing the current regional dominance of Israel. Considering that Iraq was a major Arab state, such a cowing of post-Saddam Iraq was to be envisioned as an unstated, but a capstone, achievement of the Bush administration.
Iran, the Iraqi Shi'ite clergy and the Shi'ite populace had entirely different agendas. The Iraqi Shi'ites were in favor of having a democratic setup, since such an arrangement promised to give them an unprecedented opportunity of becoming a dominant ruling group, as they are the dominant group, ahead of Sunni Muslims. However, their own perspectives of democracy were marked by a lack of clarity from the very beginning. They did not seem to know whether they preferred a secular democracy or a government based on Islam. Second, and more important, the reason for their bewilderment on the issue is that even the Shi'ite clerics are led by proponents of two schools of thought: the Islamists and the quietists.
The Islamist groups - now led by Muqtada - want an Iran-style Islamic government in Iraq. Whether it would be another vilayat-e-faqih (rule of the learned cleric) a la Iran, or a pale resemblance of it, is not quite clear. But this perspective is very much present, and is likely to become a visible player during the elections of 2005. The chief weakness of this school in today's Iraq is that it is led by a young cleric, Muqtada, who doesn't carry impeccable religious credentials (compared to Sistani), but makes up for it many times over in charisma. Considering that charismatic leaders in the Middle East - indeed in the Muslim politics at large - usually carry a larger sway than sedate moderates, no one should rule out a major voice for the Muqtada brand of religiously alluring leaders in the post-Saddam Iraq.
The quietist school - which advocates keeping politics and religion separate - is led by Sistani, an ardent promoter of Islam-based democracy in Iraq. In his vision, Iraq is to be governed by a Shi'ite-dominated democracy, where moderate Islam will play an important role. It was Sistani's insistence on holding elections in the near future, and his deeply rooted suspicion of the former CPA, that forced the Bush administration to abandon its obsession with unilateralism in Iraq, and allow the participation of the UN. The participation of the world body also initiated a highly desirable phase of multilateralism governing the US presence in Iraq. The continued insurgency and terrorism inside that country also played a vital role in forcing the US's hand in that direction.
Sistani's prestigious and powerful presence has ensured that elections will be held in Iraq within the next six months. At the same time, he serves as an equally potent source of the participation of Islamic candidates in the Iraqi elections.
Iran's role in the Shi'ite side of the power equation in Iraq is extremely calculating and multidimensional. Iran has strong theological ties with Iraq; it served as an important source of anti-regime protest even during the heyday of Saddam's rule; and continues to play a similar role regarding the presence of US forces in its neighboring state. Iran's influence on Iraq's underground economy has remained substantial. As such, it is expected to influence the future course of that country's politics. One can be assured that Iran will - to the chagrin of the US - handpick many candidates in the forthcoming Iraqi elections.
It should be pointed out, however, that the chief obstacle that Iran faces in Iraq is the uncertainty of Iraq's Shi'ites about the future course of their democratically elected government: whether it should be modeled after the Islamic Republic of Iran or a moderate Islamic democracy, with a limited role for the clergy? The chief reason for this uncertainty is that the Iraqi Shi'ites are not at all impressed with the ostensibly sustained inertia inside Iran as a result of the enduring struggle between the hardliners (led by the Supreme Leader Ayatollah Ali Khamenei) and the pragmatists (led by President Mohammad Khatami). In all probability, the Iraqi Shi'ites don't want to implant that inertia in their own polity by adopting the Iranian model. Sistani will play a crucial role in resolving the dilemma of the Iraqi Shi'ites, by promoting a sui generis Iraqi democracy based on moderate Islam. Regardless of the outcome, Iran's influence on Iraqi politics is not likely to dissipate in its neighboring state. This reality continues to frustrate the Bush administration.
Muqtada envisions an Islamic Iraq, with no influence or presence of the US. Sistani would prefer a moderate Islamic democracy dominated by Shi'ites. He has no use for the US either, once Iraq becomes a Shi'ite-dominated Islamic democracy. Actually, these two visions may not be that much apart, if they are not to get entangled in the personality differences between these two individuals.
However, from Muqtada's side, it is well nigh impossible to minimize the element of personal aspirations. Muqtada is very much interested in seeing the creation of some sort of vilayat-e-faqih. In principle, such a concept emphasizes the exercise of power by a high-powered ayatollah, like Sistani. In reality, since Sistani belongs to the quietist school, he is not interested in such a role, as was adopted by the late Ayatollah Ruhollah Khomeini, leader of the Islamic Revolution in Iran in 1979. Muqtada, on the contrary, despite his lesser religious credentials, definitely aspires to such a role. In the past three months or so his popularity among poor Shi'ites and even among hardline anti-American Sunni Iraqis has gone way up. Whether or not he can translate that popularity into votes will be determined during the next elections.
If Iraq were to become an Islam-based democracy, Washington would envision it as a setback for its own larger vision of democracy in the Middle East. If Bush were to be reelected, the tug-and-pull between the US and Iran over the future political course of Iraq would only intensify. Iran will play its hand to the hilt; that includes exploiting its theological connections, and utilizing its economic power in order to make its presence felt in Iraq.
At least for now, Iran does not seem to be overly apprehensive about America's larger designs to democratize the Middle East, especially if there is a second Bush administration. Bush has created so much ill will through his invasion of Iraq and through his perceptibly overly one-sided policies on the PLO-Israeli conflict that his credibility in the Middle East - indeed, in the entire world of Islam - will not be reestablished any time soon. So Iran does not feel compelled about responding to America's mega-designs toward the Middle East. It knows if it can maintain its sway in the future course of power politics inside Iraq that would be a major achievement for now. Iran appears convinced of the powerful linkages between the creation of Islam-based democracy in Iraq and the failure of the US in its larger designs to implant secular democracy in the Muslim Middle East. Fortunately for Iran, a number of Middle Eastern states have a jaundiced perception of Washington's democracy-related activities and vision for their region.
Ehsan Ahrari, PhD, is an Alexandria, Virginia, US-based independent strategic analyst.
(Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact content@atimes.com for information on our sales and syndication policies.)
----------------------------------------------------------
The Trouble with Oil
The problem isn't just supply and demand: It's that the internal political concerns of

producing countries trump economics.
by Irwin M. Stelzer
08/24/2004 12:00:00 AM
SO NOW WE KNOW. If the demand for oil grows at a surprising rate, and the supply is

constrained, the price will rise. Add myriad threats of supply disruption, an infrastructure

which has been starved for capital and environmental permits for a decade, and a producer

cartel, and you get increases that are sharp and enduring. Anyone who missed that lesson in

his elementary economics course will certainly have learned it from the business press in

recent months.
Unfortunately, concentration on daily price movements diverts attention from the more

threatening changes taking place in oil markets.
Most important is the realization by consuming countries that the internal political

dynamics of their producer-suppliers trumps the needs of customers every time. Consider

three of the world's largest producers, sitting on some 40 percent of the world's reserves:

Russia, Saudi Arabia, and Venezuela.
Vladimir Putin is unconcerned about the price effects of his assault on Yukos, Russia's

largest and most efficient producer. He feels it imperative to eliminate Yukos' principal

shareholder, Mikhail Khodorkovsky, as a political rival, and to transfer Yukos' major

production properties to a company controlled by his former KGB buddies. If that means oil

prices rise and abort the U.S. recovery, too bad for President Bush. Not even calls from

national security adviser Condoleezza Rice to Dmitry Medvedev, Putin's chief of staff, could

persuade Putin to abandon his political assault on Yukos to help bring crude prices down.
Nor could pressure from his Chinese friends move the Russian president, who must enjoy being

in a position to ignore the pleas of the world's greatest superpower and its potential

challenger for that crown. Putin may no longer be able to send tanks rolling across Europe,

but he is certainly able to make it very expensive for the world's motorists to send their

vehicles rolling across their nations' highways.
The important thing to note is that the world's largest oil consumer (America) and the

world's fastest growing importer of oil (China), although competing for supplies, now also

realize that they have a shared stake in the stability of Middle East producers, and the

secure movement of oil on the world's sea lanes. Politics may make strange bedfellows, but a

thirst for black gold makes even stranger ones.
Then there is Saudi Arabia, no longer capable of controlling oil prices merely by issuing a

press release about its production intentions. One expert on that country's politics and

industry tells me that Saudi promises to step up output are worthless, since a significant

portion of that country's "reserves" are "political barrels," nonexistent or at best

undeveloped barrels reported to enhance Saudi prestige but not actually quickly extractable.
American defense and intelligence officials until recently assigned a 50:50 probability that

the Saudi regime would survive for the next ten years. They are now quietly speaking in

terms of a mere five years. Which means that there is an even chance that the kingdom's

royal family soon will be calling for help to prevent a bin Laden-like takeover. China and

America will find themselves with no choice but to join forces to protect the Saudi fields

from a takeover that could result in a halt to production. So don't look for China to oppose

steps America might feel necessary to keep Saudi oil moving onto world markets. Russia,

untroubled by the disappearance of a major competitor from the supply side of the oil

market, would be likely to oppose Sino-American intervention.
Then there is the effect tight oil supplies are having in America's backyard, South America.

In this region, Venezuela is the key player. That nation's pro-Castro, anti-American

president, Hugo Ch?vez, is now firmly in charge of the Western hemisphere's largest supply

of oil, a supply only a six day tanker-trip from the United States (Saudi oil is six weeks

away). Buoyed by his recent referendum victory, Ch?vez plans to divert supplies from the

United States to the South American countries he is wooing.
As in Russia and Saudi Arabia, the internal political goals of Venezuela's leader override

any desire to make life easier for the U.S. oil-fueled economy. Putin wants to stifle

political opposition; the Saudi royal family fears it will be overthrown if it invites

needed American capital into the country; and Ch?vez wants to foment an anti-American

movement in South America.
Meanwhile, as these ominous signs accumulate, politicians fret, strut, and do nothing.

President Bush has a multibillion dollar energy bill before Congress that at most would

squeeze a relatively few drops of oil from the Arctic, perhaps a decade from now, and gives

short shrift to any effort to increase the efficiency with which energy is used in America.

Fortunately, Congress has so far refused to pass it, not out of any sudden spurt of

parsimony, but because it wants still more goodies placed under this Christmas-tree of a

bill.
John Kerry is proposing to denude American dinner tables of corn by converting the nation's

crop to expensive methanol, along with somehow forcing consumers to pay for expensive solar

power, and effectively foreclosing the nuclear option by opposing a bill he once supported

that would create a storage site for nuclear waste in Nevada's Yucca mountain, a state with

five up-for-grabs electoral votes. How this will allow Kerry to achieve his stated goal of

"energy independence" remains a mystery to all serious observers of the energy scene.
Meanwhile, with America's refineries operating at a stretched 96 percent of capacity,

environmentalists continue to oppose any significant expansion of the nation's creaking

energy infrastructure, local groups continue to fight to prevent the construction of port

facilities that would allow the needed increases in imports of liquefied natural gas (LNG),

and voters remain unenthusiastic about a tax that might encourage them to use a bit less

gasoline.
In sum, current high prices are the least of America's energy problems.
Irwin M. Stelzer is director of economic policy studies at the Hudson Institute, a columnist

for the Sunday Times (London), a contributing editor to The Weekly Standard, and a

contributing writer to The Daily Standard.
? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.
--------------------------------------------------------------------------
Arab states still need Western money to hike oil production
SPECIAL TO WORLD TRIBUNE.COM
Thursday, August 26, 2004
ABU DHABI - Arab states require international funding to finance energy projects.
A report said Arab governments will continue to rely on Western banks to finance crude oil,

natural gas and petrochemical projects. The study, prepared by the Arab Petroleum

Investments Corp., cited the limited financial capabilities of Arab banks. Arab Petroleum

Investments was established in 1975 with the participation of 10 Arab governments.
The study, authored by the corporation's director of projects management, Abdullah Ibrahim,

estimated energy and petrochemical investments in the Arab world to reach $63.5 billion from

2002 to 2006. The report said $36.5 billion would be invested in gas projects.
The investments would take place in Algeria, Egypt, Kuwait, Libya, Oman, Qatar, Saudi Arabia

and the United Arab Emirates. The study said the Arab states would require $49 billion from

2002-2006 to increase oil output.
About $5.5 billion would be required to increase oil production in Iraq.
Copyright ? 2004 East West Services, Inc.
--------------------------------------------------------------------------------

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.
--------------------------------------------------------------------------------


The Leonard Lopate Show
http://www.wnyc.org/shows/lopate/episodes/07222004
Maoist Rebellion
Thursday, July 22, 2004
Our continuing series, "Underreported," focuses on Nepal, where a violent Maoist insurgency is growing. We'll hear from Dr. Tara Niraula, President of the America-Nepal Friendship Society, and Kunda Dixit, editor of the Nepali Times, who will be calling in with an update from Kathmandu.
Dr. Tara Niraula and Kunda Dixit
Dr. Tara Niraula, President of the America-Nepal Friendship Society, and Kunda Dixit, editor of the Nepali Times, on the violent Maoist insurgency in Nepal.
? More on the America-Nepal Friendship Society
? More on the Nepali Times

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

Nepal: An India-China crisis in slow motion
By Sol Sanders
SPECIAL TO WORLD TRIBUNE.COM
August 26, 2004
In another time and place, Nepal's leisurely implosion would be only another instance of a

failed third world ministate, unfortunately all too prevalent in the volatile early 21st

century world. In mid-August only an implied threat by the rebels - who control at least

half of the little Himalayan kingdom's countryside - blockaded and paralyzed the capital for

a week.
It wasn't clear whether the self-proclaimed Maoist leadership, who are primitive butchers

even as much as followers of Mao Tse Tung claptrap theories, were expecting a "general

uprising". That in Marxist dogma is supposed to follow their "anti-imperialist" campaign of

slaughtering police and teachers and enthralling oppressed peasants and na?ve intellectuals.
In any case, it didn't come.off. But the threat was enough to paralyze Indian-Nepalese

traffic, close down major businesses, and - of course - scare away the tourists, the

country's main income. What was demonstrated, again, was the regime's incompetence - both

the royal family [which almost disappeared in a single emulation by a crazed crown prince in

2001], the politicians, and the military. [Both India and the U.S. - $40 million this year -

have tried to help modernize the Nepalese military.]
In Katmandu, the capital's population was said to have been so inert there wasn't even a run

on supplies. But there was just enough violence and support from above-ground radicals to

terrorize and paralyze civilian life.
Perhaps more telling was the hand-wringing in New Delhi. That is, to the extent machinations

of the continuing post-election politics did not squeeze the whole issue out of official and

public consciousness. When New Delhi suggested dropping food supplies to thwart the

blockade, the Nepalese reaction was mind your own business. The Indians quickly retreated.
Apparently everyone now goes back to the Maoists' killings in areas they do not already

control [more than 10,000 dead in five years], and feeble efforts of the King to negotiate

while the politicians play musical chairs [15 governments in 10 years]. The Maoists use the

usual tactics of negotiation and reprise of violence. Their stated aims are an assembly to

end the monarchy, abolishing existing treaty arrangements with New Delhi [including the

enlistment of the famous Gurkha mercenaries], building a Communist republic. But they reject

present Chinese dogma as having abandoned true Maoist principles.
One of those accidents of colonial history, Nepal's 27 million multiethnic, multiracial

inhabitants live on a slice of the north India plain [no defensible physical border exists]

and in the high Himalayan valleys and mountains [including Mt. Everest, the world's

highest]. The size of Arkansas, it lies between India and China's so-called Autonomous

Tibetan Region. With a Hindu monarch descended from an ancestor who retreated to the

Himalayas during the Moslem conquest in the mid-18th century, it has the closest cultural

and economic ties with India. The country could be said to be ripe for revolution with

widespread poverty, a remote government perceived as corrupt, a conflict-riven royal family,

a feudal system run by rich landlords.
Since the Communist takeover in Tibet, the Nepalese have maintained a carefully correct

relationship with Beijing, accepting extensive aid [including connecting highways, making

the Indians nervous]. Beijing has officially labeled the Maoists "terrorists". Recently, the

Nepalese swapped border tightening to end what both sides officially label weapons

"smuggling" for reversing Katmandu's throwing Tibetan refugees back.
But a revolutionary regime in Nepal, or even continuing rebel growth, is a threat the

Indians cannot ignore. The Maoists have already made occasional forays into the Terrai, the

lowlands abutting India. They have close links with similar revolutionary groups in India

itself - the so-called Naxallites and People's War who carry on stop-and-go guerrilla-

criminal campaigns in half a dozen Indian states. Again, these insurgents, in turn,

originally took their cues from the Communist Party [Marxist-Leninist], the part of the

Indian movement which sided with Beijing in the 1950s Moscow-Beijing split. They have ruled

in West Bengal state [Calcutta] for more than 20 years. And their votes now give the

coalition government its majority in India's federal parliament.
Furthermore, a growing problem in Nepal fits into the general picture of troubled India-

China border relations. Outgoing Prime Minister Vajpayee, with a visit to Beijing last year,

tried to restart negotiations for a disputed border which broke into war in 1962. But

Beijing wants an overall comprehensive settlement, ostensibly, and New Delhi wants detailed

negotiations on issues at both ends of the long border - from troubled Kashmir in the west

to the Indian northeast with its half dozen local insurgencies. Already the atmospherics

have turned sour with the Indians postponing opening old trade passes to Tibet and the

Chinese refusing inspection of clandestine dams on rivers arising in Tibet and flooding

India.
If the Nepal crisis continues to grow, as now seems likely, it cannot but be a new troubling

issue between Asia's two giants.
Sol W. Sanders, (solsanders@comcast.net), is an Asian specialist with more than 25 years in

the region, and a former correspondent for Business Week, U.S. News & World Report and

United Press International. He writes weekly for World Tribune.com.

------------------------------------------------------------
Russian defense firms scramble as Europe eyes China market
SPECIAL TO WORLD TRIBUNE.COM
Monday, August 23, 2004
MOSCOW - Russia's defense industry has been clamoring for an expanded Middle East market to

compensate for an expected decline in arms sales to China.
Russian industry sources said 2004 could mark the first drop in weapons exports to China

amid plans by the European Union to lift its embargo on Beijing. The sources said President

Vladimir Putin has been urged to help Russia's defense industry find new markets,

particularly in the Middle East.
The focus of Russian efforts in the Middle East has been Algeria. Russia has been trying to

win Algerian approval for a $1.5 billion sale of nearly 50 advanced MiG-29 fighter-jets to

the North African state. In July, Russia completed an estimated $300 million sale of 12 MiG

-29s to Sudan, Middle East Newsline reported.
France and Germany have been prepared to offer China a range of defense equipment, the

sources said. They said negotiations with Beijing could begin by the end of 2004 after the

European Union lifts trade sanctions imposed in the aftermath of China's killing of hundreds

of protesters in 1989.
"France and Germany, which are ready to offer to China hi-tech electronic reconnaissance,

navigation, communications and target designation systems - the weak points of the Russian

defense industry - already have their sights set on developing this market," Dmitry

Litovkin, a defense analyst wrote in the Moscow-based Izvestia.
The sources said Russia's state arms agency, Rosoboronexport, has examined the prospect of a

reduction in defense exports to China market and the need to develop the Middle East and

other markets during 2004. They said Rosoboronexport intended to accelerate weapons

development and ensure quicker delivery of spare parts to clients in an effort to develop

new markets.
But the largest potential Russian market in the Middle East has failed to materialize. In

2002, Iran and Russia signed a defense cooperation agreement with an estimated worth of up

to $7 billion. Russian sources cited Iran's economic difficulties as well as U.S. pressure

against the sale of advanced weaponry to the Islamic republic.
In 2003, Russia's defense exports reached a record $5.4 billion. Of that, Rosoboronexport

administered export sales of $5.1 billion.
Copyright ? 2004 East West Services, Inc.

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Hu Jintao and his bitter banquet of injustice
By Xia Xiangren
Translated by Augustine T H Lo
HONG KONG - Sometimes bits of little-known personal history illuminate the character of major figures, in this case reformist Chinese President and Communist Party Chairman Hu Jintao, currently locked in a struggle for power with his predecessor Jiang Zemin. For years Hu has refused to visit his ancestral home in Jiangsu province because party officials there refused to rehabilitate his father, who was unjustly accused and imprisoned during the Cultural Revolution - and who perished.
More than 20 years ago, Hu sought redress from local party officials on behalf of his father, a tea-shop owner condemned and persecuted as a bourgeois capitalist. Hu even ordered a restaurant banquet for local Communist Party officials so they could sort out the case over delicacies and rice wine and agree to rehabilitate his father. They never showed up. Hu waited, and waited. Then he invited the kitchen staff, chef, cooks and dishwashers, to come and share the bounty. That was more than 26 years ago.
There is a story among Taizhou's citizens that when Hu departed Tai county, he swore a solemn oath that he would never return to the place where his father, Hu Ningzhi, was disgraced, and he himself was humiliated.
Hu Jintao has never returned. This spring, when local officials spruced up his birthplace and ancestral home in coastal Jiangsu province - undertakings unknown to Hu at the time - he never showed up, even when he was informed of the elaborate preparations. Here's the story, uncovered by Asia Times Online's Hong Kong staff:
The birthplace of Communist Party Chairman Hu Jintao, the moderate, reform-minded national president, Taizhou city in Jiangsu province, had taken upon itself to repair Hu's ancestral tomb without his prior knowledge. The city even undertook a series of projects in praise of Hu's achievements and in anticipation of a pilgrimage this past spring to pay respects to his ancestors. However, Hu's ancestral trip did not come to pass, and he has not inspected the projects that apparently had been forced upon Taizhou citizens, despite their protests.
Asia Times Online investigated the scene at Taizhou, and discovered that Hu has not returned there for at least 26 years. In fact, his absence is inextricably linked to the tragedy of his father, Hu Ningzhi, who perished during the Cultural Revolution.
Hu left home at 18 and ascended the political ladder
According to all official media records, Hu Jintao is a native of Jixi in Anhui province. In fact, Anhui is Hu's place of ancestral origin, and his own birthplace is in the Taizhou (formerly in Yangzhou) area of Jiangsu province. Hu attended school in Taizhou until age 18 when he left for university in Beijing and slowly ascended to the Chinese political stage.
Hu Jintao rarely resided in Tai county and his actual birthplace was 10 kilometers beyond Taizhou's municipal boundaries. Hu's mother, Li Wenrui, was originally a native of Baimizhen-Hujiadian village (now Yaozhuang village) in Tai county. Even though Hu's father, Hu Jingzhi, was born to natives of Jixi, he was actually born on the periphery of Shangba, the Tai county seat, during the republican period. Hu's father was a Tai county resident of the New China and fluent in the local dialect.
Thus, according to the former policy of residency registration, Hu Jintao is technically a native of Taizhou, Jiangsu. This situation is similar to that of long-deceased former Chinese premier Zhou Enlai, whose parents were both from Zhejiang. They gave birth to Zhou only after arriving in Wei-an in Jiangsu province.
Why is it then that Hu Jintao, born in Tai county and whose lineage is one-half from Tai county, does not acknowledge that he is a Tai county native?
Observers have long held several views on Hu Jintao's silence on his second home town of Taizhou. According to one view, when Hu joined the Standing Committee of the Politburo in 1992, in accordance with relevant rules of the Communist Party Central Committee, which seeks wide geographic representation, a single locale may not produce two Standing Committee members. At the time, the Standing Committee of the Politburo already included Jiang Zemin, who claimed to be from Yangzhou, Jiangsu province. Jiang preceded Hu as president, still holds the position of chairman of the party's Central Military Commission and is locked in a power struggle with Hu over party reforms, priorities and visions of China.
At that time, in 1992, Taizhou and Yangzhou had not yet been divided into different jurisdictions, and so China's leader Deng Xiaoping decided Hu should be considered a native of Jixi, Anhui province.
Another view holds that although Hu's dossier had always registered him as a native of Yangzhou, Jiangsu province, since his departure from home at age 18, he changed his residency registration to Anhui in order to mourn his father's death in 1978 during the Great Proletarian Cultural Revolution.
Hu's father and grandfather ran a tea shop
The story of Hu's kinsfolk began a long time ago. Hu's grandparents moved from Jixi to Shangba, Tai county, during the late Qing period to sell tea leaves. Hu Jintao's father, Hu Jingzhi (genealogical name, Hu Zengyu), continued running his own father's tea shop.
After Hu Jintao was born, his mother Li Wenrui never felt well and could not supply milk. So Hu was sent to the care of his maternal aunt, Liu Bingxia. Thus Hu's aunt became his nurse. (Liu Bingxia, a nonagenarian, continues to maintain a frugal lifestyle.) At the time, Liu Bingxia was a little over 30, older than Hu's mother by only 10 years, yet was considered her elder.
In 1949, his mother died from illness, when Hu was only seven, and his two younger sisters (elder sister Hu Jinrong and younger sister Hu Jinlai) were only three and five. Left without options, Hu Jingzhi sent his three children to the care of his younger aunt and his wife's aunt-in-law in Taizhou. He never remarried.
Hu Jintao's maternal grandfather, Lao Lijia, also had a large family at the time. Lao not only had a business in Jiangyan (originally in Tai county) but also had what was considered at the time a palatial Ming-Qing-style family compound on Benefactor's Lane within the walls of Taizhou. Hu Jintao was born in this compound, and lived there for more than 10 years.
When he was seven, he was sent to Dapu Elementary School on Xiqiang Road in Taizhou. When he was 12, he entered the Jiangsu Provincial Taizhou Middle School on Xilingyuan Road for both junior- and senior-high education. When he was 18, he left Taizhou for Tsinghua University in Beijing. His old classrooms are still standing.
When Hu Jintao was in his teens, communist authorities appropriated his father's tea shop as a public and private joint enterprise. His father, Hu Jingzhi, thus became an employee of the Tai County Distribution Center. Because Hu Jingzhi had offended some local people during the 1966-78 Cultural Revolution, the pro-Mao Zedong rebels declared that Hu Jingzhi had embezzled public funds. They dragged him on to a stage for public denunciation and struggle sessions. He was then imprisoned.
Hu's father tortured and imprisoned
Hu Jingzhi suffered cruel physical punishment during his imprisonment and his body withered away. When the Cultural Revolution ended in 1978, he died at the relatively early age of 50. Hu Jintao, then 36, was assigned to the Qinghai region in the far west, and was already a deputy-level cadre (fuchuji ganbu).
Upon hearing of his father's passing, Hu immediately rushed back to Tai county - he was in Gansu province at the time. Before laying his father to rest, Hu found the Taizhou authorities linked to his father's case, county executive Lu Mo, as well as the leaders of his father's work detail (danwei). He pleaded with them to rectify his father's case, and offered proof of his father's good character and patriotism.
At the time a number of deputies in the bureau had already agreed to support Hu's case for redress and rehabilitation of his father. Moreover, they even introduced Hu to the best restaurant in Tai county and suggested that Hu and the local leaders discuss the case over wine.
On the following day at noon, Hu spent 50 yuan (equivalent to 1,500 yuan or US$181 today) to hire two tables at the Tai county restaurant. He waited until 2pm without anyone appearing. At 3pm, a county committee chief rushed over and apologized, saying that the county executive and distribution-center officials were in conference all day, and that he had been sent to relay their greeting and apologies.
Hu, joined by his relatives, sat at the tables and sighed. Finally, he invited the restaurant chefs, cooks and dishwashers to join his group to finish the feast. Seeing those unrelated persons enjoying the feast, Hu's relatives could do little more than sit in stoic silence.
The Taizhou restaurant chef at the time still recalls his meal with Hu as vividly as if it had been yesterday. He contentedly smiled to the Asia Times Online journalist, saying: Don't think of me as a useless old man. Twenty years ago, Chairman Hu not only invited me to his table, but also toasted with me!
Today there are some who say the case of Hu's father was not rectified until the late 1980s. There are others who claim that his father has never been vindicated. Later Hu Jintao returned to Qinghai and continued working. In the 26 years since then, Hu Jintao has never visited Tai county.
(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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SPEAKING FREELY
Another (Asian) look at China-Korea ties
By Yu Shiyu
Speaking Freely is an Asia Times Online feature that allows guest writers to have their say. Please click here if you are interested in contributing.
Recent reports about Sino-Korean relations and political developments on the Korean Peninsula have often contained views that can be termed Eurocentric regarding the history of that part of Asia. For example, both the Chinese academic establishment and the South Koreans from their government on down have been criticized for having engaged in "historical revisionism", a tendency that, according to these reports, reflects some myopic visions if not something even worse on the part of the "historical revisionists". In addition, both Beijing and the entire South Korean society, including the once arch anti-communist military, have been accused of turning a blind eye to North Korea's "crimes against humanity" in their respective efforts to appease Pyongyang.
Enormous changes are indeed happening in and around the Korean Peninsula that will fundamentally alter the geopolitical balance of the region. Many of these changes are in general rather damaging to the United States' interests, hence perhaps the aforementioned alarming criticism of both China and South Korea. However, this author ventures to opine that a more Asiacentric perspective on the long history of that part of Asia, especially that of Sino-Korean relations, is called for before one addresses what are frankly mostly Eurocentric concerns quoted above.
Sino-Korea relations - the past
One of the most important current trends in Northeast Asia is the rapid Sino-South Korean rapprochement, despite several real or made-up difficulties such as the North Korean refugees and the recent controversy concerning the history of the ancient kingdom of Koguryo. This trend has led some Western observers to conclude that China has never been as important to Koreans as it is today.
Such an observation could not be more fallacious from an Asiatic perspective. The fact of the matter is that in the past China has, on occasion, been a lot more important to Koreans than it is today - and not just once, but a few times. Furthermore, these experiences still influence, much more heavily than the history of the hapless kingdom of Koguryo does, current and future events in Northeast Asia.
To start with, there was the devastating invasion of Korea (1592-98) by the Japanese warlord Toyotomi Hideyoshi. This author has had the opportunity to read in their entirety all the "veritable records" of the Yi dynasty (Yijo silrok) related to this invasion, written in elegant classical Chinese. These first-hand Korean documents, whose reading is a prerequisite in my opinion for any discussion of past Sino-Korean relations, demonstrate beyond any doubt China's then critical importance vis-a-vis the very existence of the Korean state, from which the current nuclear crisis in North Korea is a far cry.
One also begins to realize after reading these records why the Hideyoshi invasion is still central to Korean people's collective consciousness today, second only to their even more traumatic experience under the more recent Japanese colonial rule.
At least one Western author, Nicholas Kristof of the New York Times, understands the historical relevance of this experience. In a cover story published several years ago in the all-too-authoritative Foreign Affairs journal, Kristof mentioned the famous "Ear Mound" in Kyoto, in which the ears and noses of tens of thousands of the Korean victims of the Hideyoshi invasion were buried. Such a macabre monument of historical atrocity would no doubt play a much more important future role than whatever controversy surrounds the kingdom of Koguryo, Eurocentric wishes notwithstanding.
The Hideyoshi invasion was also one of the critical factors leading to the Ming Dynasty's demise just a few decades later, as China's help to the Koreans greatly exhausted the Ming regime, weakening its ability to fend off the imminent threat of the Manchus. The Yi Dynasty's staunch loyalty to the Ming during this period, often at great risk to its Korean subjects themselves, led to many interesting stories and is also an active area of historical research.
This chain of events was to repeat itself near the end of the Qing Dynasty - except a weakened China was unable to help defend and maintain the existence of Korea as a state, whose disappearance on the world map demonstrated again China's then much greater importance than that of today.
Japan colonization more interesting than Koguryo
Incidentally, this history of the brutal colonization of Korea by Japan is apparently attracting a lot more interest than that of the ancient Koguryo, as evinced by the recent South Korean legislation to investigate the history of Korean collaborators in this process. And a palpable "Anglo-Saxon" role in supporting Japan's conquest of Korea may turn out an even bigger issue, hence probably the Koguryo distraction we are witnessing today.
It is well known that the rise of Japan concurred with a growing Anglo-Japanese alliance officially sealed in 1902 after long percolation. It is reported that the late US president Theodore Roosevelt, a politician famously known "to speak softly but carry a big stick", was once a "secret member" of this alliance. At least one Korean-American historian has studied possible "Anglo-assistance" in the navy battles during the First Sino-Japanese War triggered by the Japanese encroachment of Korea.
This "Anglo-Saxon role" became all too apparent when Japan's annexation of Korea accelerated during and after the Russo-Japanese War (1904-05), culminating in Roosevelt dispatching his secretary of war (later the 27th president of the US) William Howard Taft (1857-1930) to conclude the famous (or infamous, depending on one's perspective) Taft-Katsura Agreement, with Japanese prime minister Katsura Taro (1847-1913), acknowledging the two countries' respective annexation of the Philippines and Korea. One will no doubt hear more about these Anglo-Saxon "historical sins" in Japan's colonization of Korea, as once hinted by the French daily Le Monde, and to the even greater dismay of some Eurocentric observers.
On the other hand, despite the reversed fortunes of both Koreans and Chinese, their leaders never stopped striving to restore the state of Korea. This started with Yuan Shikai (1859-1916), the commander of the Chinese forces in Korea during the First Sino-Japanese War, who had married a Korean woman. Yuan later became the first formal president of the Republic of China after the Qing Dynasty collapsed not long after losing that war, and earned the unflattering epithet "the grand thief who stole the Republic". Yuan enthusiastically supported the restoration of the Korean state nonetheless.
This was followed by all Chinese Republic leaders, Sun Yat-sen (1866-1925) and Chiang Kai-shek (1886-1975) in particular. Chiang became a staunch supporter and financier of the provisional government of the Republic of Korea, mobilizing, for instance, all Chinese resources in sheltering and protecting its leader Kim Koo (1876-1949) after the attack (or one may say "terrorist act") in 1932, by the Korean activists including the famous Korean independence martyr Yoon Bong-kil, against the top Japanese military leaders in the colonial concession in Shanghai. During the darkest days of the Second Sino-Japanese War, Chiang made sure that Kim Koo received ample funding from the Chinese government. Small wonder that the entire generation of Korean independence leaders on both the left and the right had close relations with China.
Moreover, Chiang Kai-shek vigorously and in fact single-handedly promoted the establishment of an independent and unified Korea during the Cairo Conference (November 1943) and other international preparations for the post-World War II world order, whereas all other major powers, the Soviet Union and the United States in particular, were only interested in some sort of the United Nations' trusteeship and de facto partition of the Korean Peninsula. This partition later became a sorry reality, especially after the assassination of Korea's greatest son in modern history, Kim Koo, in 1949, "by pro-American elements" as many claim.
Closer to unification, this unsavory part of history and the US role therein will undoubtedly be attracting a lot of attention, Koguryo controversy or no Koguryo controversy.
The mutual importance of China and Korea to each other continued after the partition of the Korean Peninsula. It is universally agreed that the Chinese Communist Party (CCP) lost its historical chance to "liberate Taiwan" due to Josef Stalin's order to Mao Zedong to rescue the Kim Il-sung regime during the Korean War. Otherwise, Chiang Kai-shek would have lived out his years much the same way as did Rhee Syngman (1875-1965) in a foreign country.
Sino-Korean relations - the future
Nobody in his or her right mind today still questions the gradual implosion of the Kim dynasty in North Korea. Not even the CCP has any illusions on the long-term survival of its erstwhile "lips and teeth" little-brother regime. Everybody is juggling and maneuvering for the eventual and inevitable unification or rather absorption of North Korea by South Korea. The only question is when - and how.
Meanwhile, a much bigger geopolitical game is being staged in the broader Asian theater. In the words of David Shambaugh, noted China expert at George Washington University, "China [is] rapidly returning to its traditional role as the central actor in Asia." The International Herald Tribune this year described this as "two fundamental trends - a new security environment that resembles the ancient Chinese tributary system, and the rise of China's soft power". In other words, back to the "bad old days" when the Son of Heaven in Beijing called the shots in Asia.
However, this time "China's soft power" is no longer Confucianism, but the even more influential economic and trading power in this rapidly globalizing world economy. And Koreans, befitting their ancient proud self-appellation of being a "mini-China", have certainly caught the tide early on. The world has just witnessed the epochal event in 2003 when two-way Sino-South Korea trade exceeded that between South Korea and the No 1 economy on earth, the US, barely 10 years after the establishment of diplomatic relations between the two Cold War ideological and battlefield enemies. According to Chosen Ilbo, more and more unemployed young South Koreans are swarming to China, regrettably not to help their famished Northern brethren, but to seek their personal fortunes in the booming Chinese economy and the ever-expanding Sino-Korean trade.
It is of course not only the South Koreans who have jumped on this "back to traditional Asia" bandwagon, the Korean diaspora in the rest of world has sensed it too. One of its members, Soon Bum-ahn, a lieutenant-colonel in the US Army and a research fellow at US RAND, the mother of all think-tanks, published an insightful article in Current History magazine in 2001, properly titled "China as number one", prophesying "the return to Sinocentrism" in East Asia, a future that will leave the US armed forces few prospects for remaining in the Korean Peninsula.
It is therefore quite understandable that some outside observers start to worry about "South Korea's perilous historical revisionism" in its many efforts to reconcile with North Korea. Worse still, the so-called historical revisionism now pervades the entire political spectrum from left to right in South Korea, including even the military, all allegedly turning a blind eye to the North's "crimes against humanity".
N Korea is odious, but Koreans should decide future
This author has no intention whatsoever to defend the North Korean regime. I agree that it is one of the most odious regimes on Earth, and wish for its quick and peaceful demise. But I also have high confidence that the Korean people themselves in both South and North have the best knowledge and ability in navigating through this difficult time.
While acknowledging the current dreadful living conditions of most North Koreans in their communist utopia, let us not forget that, according to the US Central Intelligence Agency (CIA) country books, as late as 1976, the year of Mao's death, North Koreans still enjoyed a higher per capita income than that of the South Koreans. On the other hand, even the current "trickle" of North Korean political and economic refugees reaching South Korea has already created major financial and societal burdens in the form of settlement costs and the reported high crime rate among the refugees, according to the rather conservative Chosen Ilbo.
And talking about "crimes against humanity", in addition to what was committed in Kwangju in 1980 under the watch of the US, should one conveniently forget the massacre of the unarmed and innocent villagers at No Gun Ri, or the US Air Force's saturation bombing of North Korean cities, the use of napalm, the attacks on irrigation dams to cause flooding, to list just a few, during the Korean War, as bravely raised in the New York Times by an American professor working in South Korea. This list will surely get longer as the "historical revisionism" progresses in Korea.
War, preemptive or otherwise, is always hell. It is thus interesting to see the reference to the 1961 Treaty of Mutual Assistance between China and North Korea as a basis for China's possible military intervention in the Korean Peninsula. Not by coincidence, it is widely reported in Chinese media that North Korean leader Kim Jong-il constantly reminds China of the treaty obligations when Beijing is trying very hard not to "remember" them, so to shirk all the obligations therein. The current Chinese government may still be authoritarian and politically strong-armed, but it is not brainless. With China's exponentially growing trading power and its huge geopolitical returns in East and Southeast Asia, much less a pending military crisis in the Taiwan Strait, who in Beijing would be stupid enough to open an Iraq-type quagmire in the Korean Peninsula?
Finally let us turn to the current nuclear crisis in the Korean Peninsula. If we follow Samuel Huntington of Harvard University, then this is no more than a crisis for the US and Japan only, as Huntington described in Chapter 8 of his famous book, The Clash of Civilizations: many in South Korea would only love to inherit the "Korean bomb" after the inevitable unification of the two Koreas.
Therefore, why should the South Koreans, from ordinary folks to the military, not engage in "historical revisionism" to reduce the enmity and to build up reconciliation between the two Koreas? Or as summarized alarmingly by a recent report, "Most South Koreans no longer view the North as the primary threat to their security. That designation is increasingly reserved for the United States." This is because Koreans know full well that, once a "preemptive" war starts to relieve the US (and to a lesser extent Japan) of this nuclear threat, the blood spilled would be mostly that of the Koreans.
This author for one would never call such "historical revisionism" South Koreans' myopia.
Yu Shiyu has been appointed visiting scholar in East Asian Studies by a major university in North America. He is writing a book on Asian history to be published by a US Ivy League university. He is a regular columnist for Singapore's United Morning News (Lianhe Zaobao).
Speaking Freely is an Asia Times Online feature that allows guest writers to have their say. Please click here if you are interested in contributing.

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U.S. cites corruption in Iraqi government
SPECIAL TO WORLD TRIBUNE.COM
Monday, August 23, 2004
BAGHDAD - The United States is monitoring high-level corruption in Iraqi new government.
U.S. officials said an unspecified number of senior Iraqi government representatives and

security commanders, outside of Baghdad, were believed to have exploited their offices for

criminal activities. The U.S. officials said the Iraqis were suspected of taking bribes and

allowing smuggling and insurgency operations in their districts.
So far, officials said, no Iraqi minister has been suspected or charged with corruption. But

they said that over the next few weeks, the interim government of Prime Minister Imad Alawi

could detain a range of senior officials outside Baghdad on suspicion of criminal offenses.
On Aug. 21, U.S. forces captured Maj. Gen. Jaadan Mohammed Alwan, the police chief of the

Anbar province along the Iraqi border with Syria, Middle East Newsline reported.
The United States was authorized by the Alawi government to begin detaining the suspected

Iraqi officials and commanders. Officials said Iraqi security forces were often controlled

by the suspects and thus were not deemed reliable.
Officials said Alwan was accused of corruption and other criminal activity.
A U.S. military statement said Alwan's suspected activities included extortion, embezzlement

and accepting bribes. The statement said Alwan was also connected to abduction and murder.
Alwan was regarded as one of the most senior Iraqi officials charged with corruption. He was

meant to be replaced by an interim chief appointed by the governor of Anbar.
Anbar has been cited as a major smuggling route of weapons and insurgents from Syria into

Iraq. The U.S. military has sought to block the route but has been hampered by what

officials termed widespread Iraqi cooperation with the Syrians as well as Arab volunteers.
The U.S. military has also reported the arrest of Brig. Gen. Jaadan Kbeisi, police director

in Ramadi, west of Baghdad. Kbeisi was the target of protests by police commanders, who

threatened to resign if Kbeisi continued in his post. The military did not cite the reason

for Kbeisi's arrest.
Copyright ? 2004 East West Services, Inc.

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Syria, U.S set meeting in Rome
SPECIAL TO WORLD TRIBUNE.COM
Monday, August 23, 2004
Syria and the United States plan to discuss bilateral relations in the wake of American

sanctions on the regime of President Bashar Assad.
The United States plans to press Syria to sever its ties to groups deemed terrorist,

withdraw from Lebanon, halt its missile and weapons of mass destruction programs and end the

flow of insurgents to Iraq. The Bush administration has not ruled out additional sanctions

against Damascus should Assad fail to respond to these demands.
Western diplomatic sources said representatives from the two countries plan to meet in Rome

on Aug. 27, Middle East Newsline reported. The sources said Syria and the United States are

expected to discuss regional issues, cooperation against Al Qaida as well as Iraq.
"Both parties will see whether there has been any change in the positions of the other

side," a diplomat said.
"Syria was a major disappointment," U.S. Rep. Tom Lantos, the ranking Democrat on the House

International Relations Committee, said after meeting Syrian leaders in Damascus last week.
The diplomatic sources said the United States was also expected to demand that Syria allow

the selection of a replacement for President Emile Lahoud, whose term expires on Nov. 24.

Syria has been considering allowing Lebanon to revise the constitution so that the pro-

Syrian Lahoud could remain in his post.
Copyright ? 2004 East West Services, Inc.
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More economic worries for Bush looming
By SHIHOKO GOTO, UPI Senior Business Correspondent
WASHINGTON, Aug. 27 (UPI) -- As election day draws ever closer, the pressure is on the Bush

administration to prove that the U.S. economy has indeed improved under its watch over the

past three years.
But recent data suggest that President Bush and his team have not been as successful about

bring a turnaround as it had once thought.
For one, the Department of Commerce reported earlier Friday that the second-quarter gross

domestic product growth rate was slower than it had initially stated. GDP for the April to

June period was revised down to 2.8 percent, compared to the 3 percent growth Commerce had

reported a month ago, and significantly lower than the 4.5 percent growth rate posted for

the first three months of the year.
The 2.8 percent reading makes the second-quarter growth rate the slowest since the first

quarter of 2003, and analysts said the downward revision for the latest quarter was due in

part to the ballooning U.S. trade deficit, as well as a slowdown in consumer spending.
The government reported that consumer spending, which makes up two-thirds of GDP, increased

by only 1.6 percent in the second quarter, the slowest pace since 2001 and a sharp fall from

the 4.1 percent increase seen in the first quarter of this year. Meanwhile, there was

considerable downward pressure on economic expansion as the United States posted yet another

record-breaking trade deficit, reaching $588.7 billion by July.
But while the latest GDP figures may be worrisome for some investors, others took it in

stride.
"Despite slower second-quarter growth, we expect an acceleration in the second half of 2004

activity boosting GDP to 5 percent or above," said Brian Wesbury, chief economist at

Chicago-based investment bank Griffin, Kubik, Stephens, & Thompson. "In addition, nominal

growth in GDP has climbed 7 percent in the past year, signaling that Fed policy remains

excessively accommodative," which in turn allows both consumers and businesses to borrow

money cheaply and thus put more money back into the economy, Wesbury said.
On the other hand, some economists such as the University of Maryland's economics professor

Peter Morici said the GDP numbers reflected "the fading effects of President Bush's tax cuts

(to bolster the economy)," while higher petroleum prices as well as rising imports were

keeping the economy from expanding.
"This bad economic news will negatively affect the job market and voter sentiment in

battleground states in the Midwest and South," Morici said. "The combined consequences of

rising gasoline prices and the trade deficit, and cooling consumer and housing purchases,

indicate the Fed's announced policy of raising interest rates in steady increments risks

pushing the economy into recession and unemployment to levels above 6 percent," he added.
That may or may not be, but one thing is for certain: GDP is hardly the only data that the

White House needs to be worried about.
Another particularly worrisome indicator this week came from the U.S. Bureau of the Census,

which reported Thursday that the number of U.S. citizens living in poverty or lacking health

insurance rose for the third consecutive year in 2003, as job growth failed to keep up with

a macroeconomic rebound.
The national poverty rate rose to 12.5 percent, or 35.9 million people, up from 12.1 percent

of the population in 2002. Meanwhile, the number of people without health insurance rose to

45 million, or 15.6 percent of the population, compared to 15.2 percent the previous year.
But the bureau also reported that inflation-adjusted income of the nation's median household

was little changed at $43,318.
In response to the Census Bureau's data, Democratic presidential contender John Kerry said

"while George Bush tries to convince America's families that we're turning the corner,

slogans and empty rhetoric can't hide the real story ... under George Bush's watch,

America's families are falling further behind."
The Economic Policy Institute, a Washington-based think-tank, said that "in general, the

report confirms that the weak labor market that prevailed throughout last year continued to

take its toll on family incomes, as it did in both the recessionary year of 2001 and the

jobless recovery year in 2002."
"Clearly, the benefits of this growth (in broader U.S. economic recovery) have failed to

reach middle- and lower-income families," the EPI said.
Another major headache for Bush remains, as it has for all presidents before him since they

were first founded, social security and public healthcare. Federal Reserve Chairman Alan

Greenspan didn't help matters much when he told financiers gathered at the Kansas City

Federal Reserve's annual meeting in Jackson Hole, Wyoming that "the aging of the population

in the United States will significantly affect our fiscal situation."
Greenspan, who is a Republican but served under presidents of both political parties,

pointed out that social security and Medicare will prove to be considerable burdens on the

nation's coffers.
"Our politicians have to start facing the future with honesty and start making the necessary

adjustments. That means making hard choices now, not making more promises," said Joel

Naroff, chief economist at Naroff Economic Advisors. "As the chairman said, 'if we delay,

the adjustments could be abrupt and painful.' It should be interesting to see the political

reaction to this speech," Naroff added.
Copyright 2004 by United Press International.
All rights reserved.
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The Clinton-Hastert Wedge
Bush should exploit it.
Senator Hillary Clinton and House Speaker Dennis Hastert surely make strange political

bedfellows. A recent New York Post story, bouncing off Hastert's new book "Speaker,"

recounted Hastert's mini-gripe that Clinton and her colleague Sen. Chuck Schumer were

obsessed with bringing home the bacon for New York right after the 9/11 terrorist attack.

Hastert, however, never opposed the $20 billion aid package. What he reconfirmed for the

Post was that "All the tragedy was converted into dollars and cents. People kind of lost the

sense of the depth of the tragedy itself."
He could have added that some have lost the true meaning of 9/11, which formerly launched

the U.S. war against radical Islamism. As Norman Podhoretz recently wrote in Commentary

magazine, we are now in World War IV. Do the Kerry Democrats completely grasp this essential

point? Vietnam is over.
But there's a more compelling disagreement between Hastert and Clinton.
Back in 1994, when Clinton was pushing her grandiose plan to nationalize health care,

Hastert suggested that medical savings accounts were a much better approach to reform. Sen.

Clinton disagreed, arguing instead for a "Europeanized" America where people are inherently

greedy and can't be trusted to make decisions for themselves. In Hastert's words, "She went

on to say that she felt if money goes to individuals and they have control over it, then

that is money government doesn't have. People wouldn't spend their money as wisely as the

federal government would."
Well now. The difference between liberal and conservative couldn't be clearer. Liberals

believe that tax dollars are the property of the federal government, and that the nanny

state will spend more wisely than ordinary folks who are uninformed, stupid, or

irresponsible. Conservatives, on the other hand, believing in economic liberty, think that

tax dollars are the people's money. Government works for them; they don't work for the

government.
What we have here is a wedge issue in domestic policy -- one that President Bush will

hopefully exploit in his Republican convention speech next week. The president believes that

people should take personal responsibility and ownership for retirement, health care, and

education -- reinforcing the point that he's a believer in individual choice, free-market

competition, and economic freedom. The Democrats, however, believe in government planning

monopolies; a dependency society that celebrates economic "equality" rather than economic

growth, to paraphrase former House Majority Leader Dick Armey.
Like Hillary Clinton, John Kerry opposes health savings accounts that would give consumers

their own pre-tax cash to buy health care. These HSAs would create an incentive for

Americans to be parsimonious health-care shoppers, and would cause a transfer of power from

the federal government to individuals and families. Money not used in an HSA in a given year

can be channeled into a market-investment nest egg that will create wealth over time. Kerry

and Clinton call this elitist, thinking that only rich people invest in the market. Of

course, the 95 million strong investor class, where the majority of shareholders make less

than $75,000 a year, would strongly disagree. HSAs are similar to 401(k)s, which over a

period of 30 years exploded from zero to 42 million funds.
Kerry is also opposed to personal savings accounts as an alternative to the moribund Social

Security system. He prefers that Social Security tax dollars still be used to finance

federal spending, while Social Security beneficiaries make do with a sub-market investment

return of less than 1 percent yearly. He's saying, Let them eat cake, while we smart Ivy

Leaguers run the country. Bush, however, knows that investment markets, not government,

create retirement wealth.
The Democratic vision of Kerry and Clinton is one of state-coerced equality of results, a

short stone's throw away from Karl Marx's original vision of 150 years ago. The Republican

vision of Bush and Hastert is that equality of opportunity allows free people to make their

own decisions and exercise their God-given talents in a competitive free-market economy.

History suggests that this is the best way to make the economic pie grow larger. Some will

inevitably do better than others, but the level of prosperity and wealth will steadily rise

for everyone.
Bush's ownership society includes personal savings accounts for Social Security, health

savings accounts for medical care, new savings opportunities through the creation of

retirement savings accounts (RSAs) and lifetime savings accounts (LSAs), and education

savings accounts to propel school choice and vouchers. This moves us down the road toward

real tax reform. These tax-free savings accounts will lead to a consumed-income-tax system

that ends the multiple taxation of saving and investment -- the seed corn of economic growth.

This is a Republican agenda that bespeaks of economic liberty and rejects the Democrats'

heavy boot print of government control.
It's a battle of clashing ideas that should be front and center in this year's election

debate.
-- Larry Kudlow, NRO's Economics Editor, is CEO of Kudlow & Co. and host with Jim Cramer of

CNBC's Kudlow & Cramer.
http://www.nationalreview.com/kudlow/kudlow200408270909.asp

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Plot thickens after checking records
August 27, 2004
BY THOMAS LIPSCOMB
In the midst of the controversy between the Swift Boat Veterans for Truth and Kerry campaign

representatives about Kerry's service in Vietnam, new questions have arisen.
The Kerry campaign has repeatedly stated that the official naval records prove the truth of

Kerry's assertions about his service.
But the official records on Kerry's Web site only add to the confusion. The DD214 form, an

official Defense Department document summarizing Kerry's military career posted on

johnkerry.com, includes a "Silver Star with combat V."
But according to a U.S. Navy spokesman, "Kerry's record is incorrect. The Navy has never

issued a 'combat V' to anyone for a Silver Star."
Naval regulations do not allow for the use of a "combat V" for the Silver Star, the third-

highest decoration the Navy awards. None of the other services has ever granted a Silver

Star "combat V," either.
Fake claims not uncommon
B.G. Burkett, a Vietnam veteran himself, received the highest award the Army gives to a

civilian, the Distinguished Civilian Service Award, for his book Stolen Valor. Burkett pored

through thousands of military service records, uncovering phony claims of awards and fake

claims of military service. "I've run across several claims for Silver Stars with combat

V's, but they were all in fake records," he said.
Burkett recently filed a complaint that led last month to the sentencing of Navy Capt. Roger

D. Edwards to 115 days in the brig for falsification of his records.
Kerry's Web site also lists two different citations for the Silver Star. One was issued by

the commander in chief of the Pacific Command (CINCPAC), Adm. John Hyland. The other, issued

by Secretary of the Navy John Lehman during the Reagan administration, contained some

revisions and additional language. "By his brave actions, bold initiative, and unwavering

devotion to duty, Lieutenant (j.g.) Kerry reflected great credit upon himself... ."
One award, three citations
But a third citation exists that appears to be the earliest. And it is not on the Kerry

campaign Web site. It was issued by Vice Adm. Elmo Zumwalt, commander of U.S. naval forces

in Vietnam. This citation lacks the language in the Hyland citation or that added by the

Lehman version, but includes another 170 words in a detailed description of Kerry's attack

on a Viet Cong ambush, his killing of an enemy soldier carrying a loaded rocket launcher, as

well as military equipment captured and a body count of dead enemy.
Maj. Anthony Milavic, a retired Marine Vietnam veteran, calls the issuance of three

citations for the same medal "bizarre." Milavic hosts Milinet, an Internet forum popular

with the military community that is intended "to provide a forum in military/political

affairs."
Normally in the case of a lost citation, Milavec points out, the awardee simply asked for a

copy to be sent to him from his service personnel records office where it remains on file.

"I have never heard of multi-citations from three different people for the same medal

award," he said. Nor has Burkett: "It is even stranger to have three different descriptions

of the awardee's conduct in the citations for the same award."
So far, there are also two varying citations for Kerry's Bronze Star, one by Zumwalt and the

other by Lehman as secretary of the Navy, both posted on johnkerry.com.
Kerry's Web site also carries a DD215 form revising his DD214, issued March 12, 2001, which

adds four bronze campaign stars to his Vietnam service medal. The campaign stars are issued

for participation in any of the 17 Department of Defense named campaigns that extended from

1962 to the cease-fire in 1973.
However, according to the Navy spokesman, Kerry should only have two campaign stars: one for

"Counteroffensive, Phase VI," and one for "Tet69, Counteroffensive."
94 pages of records unreleased?
Reporting by the Washington Post's Michael Dobbs points out that although the Kerry campaign

insists that it has released Kerry's full military records, the Post was only able to get

six pages of records under its Freedom of Information Act request out of the "at least a

hundred pages" a Naval Personnel Office spokesman called the "full file."
What could that more than 100 pages contain? Questions have been raised about President

Bush's drill attendance in the reserves, but Bush received his honorable discharge on

schedule. Kerry, who should have been discharged from the Navy about the same time -- July

1, 1972 -- wasn't given the discharge he has on his campaign Web site until July 13, 1978.

What delayed the discharge for six years? This raises serious questions about Kerry's

performance while in the reserves that are far more potentially damaging than those raised

against Bush.
Experts point out that even the official military records get screwed up. Milavic is trying

to get mistakes in his own DD214 file corrected. In his opinion, "these entries are not

prima facie evidence of lying or unethical behavior on the part of Kerry or anyone else with

screwed-up DD214s."
Burkett, who has spent years working with the FBI, Department of Justice and all of the

military services uncovering fraudulent files in the official records, is less charitable:

"The multiple citations and variations in the official record are reason for suspicion in

itself, even disregarding the current swift boat veterans' controversy."
Thomas Lipscomb is chairman of the Center for the Digital Future in New York.
--------------------------------------------------------------------------------

Al-Qaeda undimmed by sanctions
By Gordon Corera
BBC security correspondent
Attacks can be cheap, says the UN
A UN report on sanctions against the Taleban and al-Qaeda - due out formally on Monday but

seen by the BBC - claims that sanctions and other measures taken by the UN have so far

"achieved less than was hoped" and have had only "limited impact".
Immediately after the 11 September attacks, the money trail attracted a lot of attention as

the US tried to gain global co-operation to choke supplies of cash that were thought to be

going to al-Qaeda.
The UN report confirms what many involved in counter-terrorism have increasingly come to

believe - that, whilst they have their uses, sanctions and other attempts to stem the flow

of money into al-Qaeda are not necessarily the most effective way of preventing future

attacks.
For instance, no nation has reported blocking an arms sale or preventing travel to anyone on

the UN list.
'Low-tech' attacks
Recent reports - both from the UN, and the US independent commission into the 9/11 attacks -

have emphasised a number of key facts about al-Qaeda's operations and its evolution which

have altered our perspective on the role of money within al-Qaeda.
COST OF ATTACKS
Madrid bombings - less than $10,000
Bali nightclub bombings - less than $50,000
US embassy bombings in Kenya and Tanzania - less than $50,000
Attacks in Istanbul, Turkey - less than $40,000
9/11 attacks - $400-500,000
Firstly, Al Qaeda's terrorism is relatively cheap. The UN report estimates the Madrid

attacks - which killed 191 people in March 2004- only cost about $10,000 (?5,600).
The Bali nightclub bombings in October 2002 killed 202 people and cost less than $50,000

(?28,000), as did the 1998 embassy bombings in Kenya and Tanzania.
Only the 11 September 2001 attacks cost more - the 9/11 commission estimated that the

plotters eventually spent between $400-500,000 (?223-280,000) to plan and conduct their

attack.
The relatively low cost of most attacks is partly because al-Qaeda and its affiliates have

used relatively low-tech means to carry out their attacks. In Madrid, perpetrators used

stolen mining explosives and mobile phones rigged to act as detonators.
'Loose network'
Secondly, al-Qaeda has proved highly flexible and adaptable.
Bin Laden has not been sighted since 2001
This has partly been forced onto the organisation because of the huge disruption generated

by the US and broader international community, ranging from the invasion of Afghanistan

through to pressure on countries in the Gulf to prevent money flows.
The UN report makes clear that the transformation of al-Qaeda into a "loose network of

affiliated underground groups" which can operate largely independently against local targets

of their own choosing, using limited resources, actually makes central flows of money less

relevant.
So the failure of sanctions is partly because "they address a set of circumstances that no

longer apply" and therefore need to be adapted and updated.
One step ahead
UN sanctions require a travel ban and arms embargo against individuals and groups linked to

the Taleban or al-Qaeda- currently 317 individuals and 112 groups. Sanctions were first

imposed in 1999.
The problem is that al-Qaeda has responded by adapting to find ways to move money.
UN sanctions have been largely reactive whilst al-Qaeda has a proven ability to adapt, be

flexible and stay one step ahead of the authorities.
Large flows are also less important because al-Qaeda cells and affiliates are often self-

financing.
The 11 September hijackers - who ran the most complex al-Qaeda operation - did receive cash

from abroad.
But in other cases - like Madrid and even the African embassy bombings - cells were forced

or encouraged to rely on crime to finance themselves, sometimes petty crime like credit card

fraud.
That has become ever more the case since the new restrictions put in place post 9/11. In

some recent cases, terrorists in Europe are reported to have operated immigrant smuggling

and passport forging rings.
'Fertile fund-raising ground'
The 9/11 commission also made clear that vast sums of money were less important to al-Qaeda

than had sometimes been assumed.
It undermined the notion that Osama Bin Laden himself had a $300m (?167) fund which he used

to bankroll the organisation.
In fact, he received about $1m (?560,000) a year until 1994 and in the mid-1990s there are

actually accounts of disputes between Bin Laden's affiliates about why some people were

getting paid less than others.
Pre-9/11, it is estimated by the CIA that it cost about $30m (?17m) a year to sustain al-

Qaeda's activities and most of this came from donations from wealthy individuals and through

charities, especially Saudi Arabia which the 9/11 report describes as "fertile fund-raising

ground".
But much of the money was spent on keeping facilities going in Afghanistan and also in

paying about $10m-20m (?6-11m) a year to the Taleban for safe haven. Now of course, all

those costs are gone and the core of al-Qaeda needs far less to operate.
Because of all these changes, the US is increasingly using the money trail as a way of

tracking al-Qaeda and trying to uncover the complicated links that make up the network,

rather than moving straight to freezing assets and trying to disrupt the flow.
In many cases, the US is now saying that it is easier to watch, observe and investigate

rather than simply cut off the flow of money. This is because only through the process of

investigation that officials can uncover new cells and understand the operations of al-Qaeda

as it disperses into an increasingly decentralised network.

--------------------------------------------------------------------------------
Montreal man downed U.S. Plane, CSIS told
'Farouk the Tunisian' involved, al-Qaeda say, but officials insist crash was accidental
Stewart Bell
National Post
Friday, August 27, 2004
A captured al-Qaeda operative has told Canadian intelligence investigators that a Montreal man who trained in Afghanistan alongside the 9/11 hijackers was responsible for the crash of an American Airlines flight in New York three years ago.
Canadian Security Intelligence Service agents were told during five days of interviews with the source that Abderraouf Jdey, a Canadian citizen also known as Farouk the Tunisian, had downed the plane with explosives on Nov. 12, 2001.
The source claimed Jdey had used his Canadian passport to board Flight 587 and "conducted a suicide mission" with a small bomb similar to the one used by convicted shoe bomber Richard Reid, a "Top Secret" Canadian government report says.
But officials said it was unlikely Jdey was actually involved in the crash, which killed 265 people and is considered accidental. The fact that al-Qaeda attributed the crash to Jdey, however, suggests they were expecting him to attack a plane.
"We have seen no evidence of anything other than an accident here," said Ted Lopatkiewicz, spokesman for the U.S. National Transportation Safety Board. "There has been no evidence found, from what I can tell -- at least that's been relayed to us -- that there was any criminality involved here. 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."
Jdey, 39, came to Canada from Tunisia in 1991 and became a citizen in 1995. Shortly after getting his Canadian passport, he left for Afghanistan and trained with some of the Sept. 11 hijackers, according to the 9/11 commission in the United States.
He recorded a "martyrdom" video, but was dropped from the 9/11 mission after returning to Canada in the summer of 2001. The planner of the World Trade Center attack, Khalid Sheikh Mohammed, claims Jdey was recruited for a "second wave" of suicide attacks.
The FBI issued an alert seeking Jdey's whereabouts in 2002. John Ashcroft, the U.S. Attorney-General, told a news conference in May that Jdey was one of seven al-Qaeda associates "sought in connection with the possible terrorist threats in the United States."
The information on Jdey's alleged role in the plane crash is contained in a memo on captured Canadian al-Qaeda operative Mohammed Mansour Jabarah. The Canadian government memo was written in May, 2002, and was based on information provided by a "source of unknown reliability."
Jabarah is a 22-year-old from St. Catharines who allegedly joined al-Qaeda and convinced Osama bin Laden to give him a terror assignment. He was tasked with overseeing a suicide-bombing operation in Southeast Asia, but was caught and has since pleaded guilty in the United States.
The report, which was sent to the Philippine National Police intelligence directorate, recounts what Jabarah said he was told about the U.S. plane crash by Abu Abdelrahman, a Saudi al-Qaeda member who was working for Khalid Sheikh Mohammed.
"In discussions, Abu Abdelrahman mentioned AL QAIDA was responsible for the assassination of Massoud, the Northern Alliance leader," the report says. "According to the source, Abu Abdelrahman added that the 12 November 2001 plane crash (btb American Airlines flight 587) in Queens, New York was not an accident as reported in the press but was actually an AL QAIDA operation.
"Abu Abdelrahman informed Jabarah that Farouk the Tunisian conducted a suicide mission on the aeroplane using a shoe bomb of the type used by Richard Reid .... 'Farouk the Tunisian' was identified from newspaper photographs as being identical to Abderraouf Jdey, a Canadian citizen who had resided in Montreal."
Jabarah was initially suspect of the claim about Jdey, but he later believed it after he saw the same information on a "mujahedin Web site," the report says.
? National Post 2004
---------------------------------------------------------------------------------
North Korea's environment crisis
By Alex Kirby
BBC News Online environment correspondent
Deforestation is the top priority
The UN and officials in Pyongyang have agreed the first-ever assessment of the state of the

North Korean environment.
The report was written by North Korea's national co-ordinating council for the environment,

together with the UN's Development and Environment Programmes.
The head of Unep said Pyongyang had shown its readiness to work with the world community to

safeguard nature.
The report lists a catalogue of neglect and over-exploitation of resources, and says time is

short to put things right.
The report, DPR Korea: State Of The Environment 2003, was produced by officials from 20

government and academic agencies, with training and guidance from the two UN programmes.
Future collaboration
It was compiled as a result of a visit to Pyongyang in 2000 by Unep's executive director, Dr

Klaus Toepfer.
He and Dr Ri Jung Sik, secretary-general of the national co-ordinating council, have now

signed a framework agreement on joint activities to improve environmental protection.
The report covers five areas: forests, water, air, land and biodiversity. It says the most

urgent priority is the degradation of forest resources.
Soils are failing and crops dwindling
Forests cover 74% of North Korea, but almost all are on steep slopes. In the last decade the

forests have declined in extent and quality.
The report says this is because of timber production, a doubling of firewood consumption,

wild fires, insect attacks associated with drought, and conversion of forest to farmland.
On water it says demand is rising "with economic development and the improvement in

standards of living", and calls for urgent investment in domestic sewage and industrial

water treatment.
It notes that large quantities of untreated wastewater and sewage are discharged into

rivers, and says some diseases related to water use "are surging".
Air quality, the report says, "is deteriorating, especially in urban and industrial areas".

Energy consumption is expected to double over 30 years, from almost 48m tonnes of oil

equivalent in 1990 to 96 million tonnes in 2020.
North Korea's use of coal is projected to increase five times from 2005 to 2020,

underlining, the report says, "the urgent need for clean coal combustion and exhaust gas

purification technologies, energy efficiency, and renewable energy alternatives."
On land use, the report says self-sufficiency in food production has been a national policy

aim in North Korea.
Changed priorities
But it continues: "Major crop yields fell by almost two thirds during the 1990s due to land

degradation caused by loss of forest, droughts, floods and tidal waves, acidification due to

over-use of chemicals, as well as shortages of fertiliser, farm machinery and oil.
Fishing off the Korean coast
"Vulnerable soils require an expansion of restorative policies and practices such as flood

protection works, tree planting, terracing and use of organic fertilisers.
"Recognising such issues, [the country] adjusted its legal and administrative framework,

designating environmental protection as a priority over all productive practices and

identifying it as a prerequisite for sustainable development."
North Korea is home to several critically endangered species, among them the Amur leopard,

the Asiatic black bear and the Siberian tiger.
Squaring the circle
It has signed up to international environmental agreements such as the Convention on

Biological Diversity, though the report notes a continuing "contradiction between protection

and development", which it says is being overcome.
In a wider context, the report says: "The conflict between socio-economic progress and a

path of truly sustainable development is likely to be further aggravated unless emerging

issues can be settled in time."
It says environmental laws and regulations need to be formulated or upgraded, management

mechanisms improved, financial investment encouraged, and research focused on priorities.
Dr Toepfer said North Korea "has shown its willingness to engage with the global community

to safeguard its environmental resources, and we must respond so it can meet development

goals in a sustainable manner."
All images courtesy of UN Environment Programme.
--------------------------------------------------------------------------------
'Revered' Wife of North Korean Leader Reported Dead
By Anthony Faiola and Joohee Cho
Washington Post Foreign Service
Friday, August 27, 2004; Page A18
TOKYO -- South Korean officials said Thursday they were investigating reports that the woman considered to be North Korean leader Kim Jong Il's most influential wife has died after a long battle with breast cancer.
News that Ko Young Hee -- idolized in North Korea as the nation's "revered mother" -- apparently succumbed to her illness was first reported Wednesday on the Web site of an investigative journalist for Chosun, a monthly South Korean magazine based in Seoul. South Korea's government-owned KBS Television followed up Thursday with a similar report, citing unnamed diplomatic sources in Beijing. Officials in Seoul said they were still trying to confirm the death.
Ko, 52, has been viewed as the foremost of at least three women considered to be among Kim's wives or consorts, though it remains unclear whether he officially married any of them. Little is known about Ko, but details about her life were provided by U.S. and South Korean intelligence analysts who specialize in North Korea.
She was believed to have been suffering from breast cancer for several years, and her death was widely expected in intelligence circles following her return to North Korea after a reported hospitalization in Paris in April. Unconfirmed reports in the South Korean media indicated that the North Koreans have ordered an expensive coffin custom-made in France.
Information on Kim and his family is closely guarded in North Korea, and the official press in Pyongyang, the capital, did not mention the reports.
Analysts said Ko's death, if confirmed, could affect the selection of a successor to Kim, 62, who inherited his post from his father, Kim Il Sung, in the first succession by bloodline in a Communist nation. Kim Il Sung, North Korea's founder, died in 1994.
Intelligence officials said they believed Kim Jong Il's three sons -- two of them mothered by Ko -- are in the running to succeed him.
In a country where Kim rules in part through claims of divinity, Ko became the subject of a glorification campaign beginning in the summer of 2002 and had been using her status and influence with Kim and the military to ensure that one of her sons -- Kim Jong Chul, 23, and Kim Jong Woong, 19 -- was picked as their father's successor.
During the campaign to elevate Ko's stature, the North Korean military has been celebrating the former professional dancer with lofty slogans and songs. Any slight to her name is considered a high crime in North Korea.
Kim's third son is Kim Jong Nam, 33, whose mother, Sung Hae Rim, died in a Moscow hospital in 2002. Kim Jong Nam, who as Kim's eldest son would traditionally be first in line of succession, is said to have had a stormy relationship with Ko.
A year earlier, Kim Jong Nam was arrested in Japan for using a Dominican passport in an attempt to visit Tokyo Disneyland -- a disgrace that analysts said forced him into a period of exile in China, Southeast Asia and Europe and may have cost him the top job in Pyongyang.
However, U.S. and South Korean intelligence officials said they believed Kim Jong Nam had returned to Pyongyang and was apparently taking a lead role in running North Korea's secret police.
Some experts said the campaign to deify Ko while she was ill may signal that Kim has decided to name one of her sons as the next leader. But others argued that her death may help Kim Jong Nam persuade his father to anoint him.
Ko, the daughter of a Korean immigrant in Japan, moved to North Korea in the 1960s. She has been considered one of her husband's closest confidants, and analysts voiced concern that her death would upset the North Korean leader at a critical time.
Kim is in the midst of a high-stakes standoff with Washington and neighboring nations over his highly developed nuclear weapons programs.
On Thursday, South Korean Deputy Foreign Minister Lee Soo Hyuck said in a speech in Seoul that serious progress in the six-party nuclear talks was unlikely until after the U.S. presidential election.
"Ko was an important person, and if it's true that she has died, then there will be some degree of impact," said Osamu Eya, a Tokyo-based North Korea specialist. "But there won't be major changes. Kim Jong Il will continue to rule with an iron fist."
Cho reported from Seoul.



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

Israel's Arrow missile fails test
JERUSALEM, Aug. 27 (UPI) -- Israel said Friday its Arrow anti-ballistic missile can

intercept an Iranian Shihab-3 missile, despite its failure to do so in a test off

California's coast.
Aryeh Herzog, the defense ministry official in charge of the Arrow, said it failed to

destroy a target missile simulating an Iranian Shihab-3 and a Scud-D like Syria has,

Ha'aretz reported Friday.
Even though the intercept failed, the Arrow did succeed in identifying the warhead in time,

the ministry said.
Thursday's test came about a month after a successful test in which a Scud missile was

destroyed in a direct hit.
Amos Yaron, the ministry's director-general, said the test was "substantive."
"Most of the systems tested worked. There was a malfunction that needs to be sorted out, and

we will continue to prepare to meet development of any future threats," Yaron said.
The Arrow is being developed jointly by Israel and the United States.
Copyright 2004 by United Press International.
All rights reserved.

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

Judge Closes Hamas Suspect's Hearing
By Brett Zongker
Associated Press
Friday, August 27, 2004; 5:47 PM
BALTIMORE -- A federal magistrate judge Friday granted a request to close a detention

hearing for a man described as a high-ranking Hamas operative after prosecutors argued it

should be secret because it was part of a grand jury proceeding.
U.S. Magistrate Judge Paul W. Grimm said the critical need to protect the secrecy of grand

jury proceedings was the "overriding" interest in the case of Ismael Selim Elbarasse.
He said it would be too difficult to make sure that information that could go before a grand

jury in Chicago that's probing the financing of the Palestinian extremist group Hamas stayed

secret during a hearing on whether authorities could continue to detain Elbarasse.
"We have the difficult overlap of hearings that traditionally have been open with

proceedings that historically have never been open," Grimm said. "Trying to make the two fit

is trying to put a square peg in a round hole."
It was not immediately clear when the hearing would take place, but Fran Kessler, chief

deputy clerk for U.S. District Court in Baltimore, said the hearing would not be Friday.
Elbarasse, an accountant from Annandale, Va., was arrested a week ago after officers pulled

over his sport utility vehicle near the Chesapeake Bay Bridge. Police said his wife was

using a video camera to tape the bridge's structure.
Neither Elbarasse nor his wife were charged with any wrongdoing on the bridge, but Maryland

authorities arrested Ismael Elbarasse after discovering a federal material witness warrant

had been issued for him the same day in Chicago.
Court documents allege Elbarasse and defendant Mousa Mohammed Abu Marzook -- considered one

of the highest-ranking Hamas leaders internationally -- shared a Virginia bank account that

was used to launder hundreds of thousands of dollars for the Palestinian extremist group.

Hamas has carried out suicide bombings and other attacks in Israel.
The U.S. attorney's office in Chicago wants to question Elbarasse, who was described in

Marzook's indictment as an unindicted coconspirator.
Attorneys for The Baltimore Sun and The Washington Post opposed the motion to close the

detention hearing.
"If government is going to deprive someone, who hasn't even been indicted, of their liberty

... it seems like it should be done in a way the public can monitor how that's being

exercised," said Mary Craig, a lawyer representing The Sun.
Neither The Sun nor the Post had decided whether to appeal the decision to close the

hearing.
Elbarasse, who had been held for the past week at a maximum-security prison in Baltimore,

attended the motions hearing but did not speak. His federal public defender, Franklin W.

Draper, took no position on whether the detention hearing should be open.
Elbarasse's attorney, Stanley L. Cohen of New York, said before the motions hearing that he

would not seek to block federal authorities' plans to move his client to Chicago, but

planned to challenge the material witness warrant in U.S. District Court for the northern

district of Illinois.
"All I'm trying to do is get my client to Chicago as quickly as possible. Maryland has

nothing to do with this case," Cohen said.
He said he did not expect that Elbarasse or his wife would face charges in the bridge

taping.
"There will be zero criminal charges -- state or federal -- with anything to do with that

bridge," Cohen said.
? 2004 The Associated Press
--------------------------------------------------------------------------------
U.S. Finances Vineyard on National Parkland
Group Questions Ohio Venture
By Juliet Eilperin
Washington Post Staff Writer
Friday, August 27, 2004; Page A19
Northeast Ohio is not famous for its viticulture, but now a public watchdog group has turned its spotlight on a winery on the grounds of Cuyahoga Valley National Park.
That's because the National Park Service has, since 1999, spent more than $475,000 to fund the winery, along with two organic vegetable and free-range chicken farms and other activities on park grounds, according to documents released Wednesday by Public Employees for Environmental Responsibility (PEER).
Tramping through Sarah's Vineyard in the Cuyahoga Valley National Park is winery architect Kristopher D. Sperry, an owner. (Courtesy Of Evelyn Sperry)
The winery has yet to produce wine, and internal documents from Sarah's Vineyard raise questions about the operation's financial viability. But park officials said the broad farming project, known as the Countryside Initiative, is a way to preserve the region's agricultural character, saying it could serve as a model for the country.
PEER Executive Director Jeff Ruch, whose group obtained the park documents through a Freedom of Information Act request, questioned why taxpayers should fund a $55,000 line to bring municipal water to the vineyard, as well as $99,000 to rehabilitate its farmstead.
"This project is both an absurd and improper use of taxpayers' money," Ruch said. "It is not the business of the Park Service to help the great state of Ohio acquire a reputation for winemaking."
But Cuyahoga Valley National Park's superintendent, John Debo, said the initiative was an innovative way to recapture the region's agricultural history while attracting visitors to the 30-year-old park.
"It's our way of responding to the need to preserve the cultural landscape of the Cuyahoga Valley National Park," Debo said. "It clearly is part of our mandate to preserve agriculture heritage."
The park has leased out three farm properties on park grounds, including the vineyard, at market rates. Debo said he hopes to lease out up to 30 farm properties over the next decade. In the case of the winery, the park receives $466 a month rent for the residence and a percentage of the gross farm product, which will increase from 5 to 10 percent over the next 10 years.
Darwin Kelsey, executive director for the nonprofit organization that advises the park on the Countryside Initiative, said the three farms now generate about $25,000 in annual revenue but the figures should rise rapidly in future years.
"These dudes are just getting off the ground," Kelsey said, adding that his group, the Cuyahoga Valley Countryside Conservancy, has raised close to $500,000 from area private foundations to finance the initiative. "We're off and running."
The project has the backing of a senior appropriator, Rep. Ralph Regula (R-Ohio), as well as the Interior Department. The Park Service also spent three years preparing an environmental impact statement on the leasing project and has concluded that farming will not hurt the parkland.
The winery has a residence as well as vineyards. Its 2.25 acres of grapes include varieties such as Cabernet Franc, Chambourcin and Traminette. The couple running the winery, Mike and Margaret Lytz, plan to produce 625 cases of wine from their current property by 2008, according to park officials.
According to Sarah's Vineyard's 2003 annual operating plan, the winery operators have some doubt about its future. They wrote in one passage: "How do we justify more expenditures given this current situation of no return on investment? Are we expected to keep throwing time and money into our enterprise with the hope that some day our partners . . . will be able to devote the necessary resources to produce the required Environmental Assessment?"
Debo said the Park Service is hoping to wrap up the assessment, which differs from the impact statement, to determine how constructing the barn and a small parking lot for the winery will affect parkland. Park officials must approve the construction before it can take place.
"They have been frustrated, I will admit, with the slow pace of the Park Service," he said. "The good news is, we're getting close to wrapping it up."
Lytz, a schoolteacher who learned winemaking from his Italian grandfather, said he was optimistic that he and his wife would eventually produce 10,000 cases of wine a year. He said they had already invested $100,000 in the project and hoped to produce 200 cases next fall. An Ohioan, he noted that the state was the leading grape producer in the mid-1800s.
"It will be very viable if we can get it off the ground," Lytz said. "It's a place for people to come in and sit down and enjoy the scenery."
Debo, who has devoted 16 years to promoting the initiative, said PEER has made "a sordid misrepresentation of these small, sustainable farmsteads" because the group wants the park to return to "wilderness condition."
"We're not going to let that happen," he said.
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The Bush presidency
Je ne regrette rien
Aug 26th 2004
From The Economist print edition
After a tumultuous first term, George Bush has much to be proud of--and much to reconsider
AP
FOUR years ago, George Bush presented himself at the Republican convention in Philadelphia as a "compassionate conservative". After the dramas and division of the Clinton years, the Texan dynast, backed by reliable old hands such as his running-mate, Dick Cheney, would provide a more modest, grown-up approach. Abroad, Mr Bush promised a humble but strong foreign policy. At home, there would be a big tax cut, affordable thanks to the large budget surplus--and, unusually for a Republican, Mr Bush talked a lot about social issues such as education. After two Republican conventions with the Christian right in full cry, he softened the party's stance on social issues at Philadelphia, and gave a hearing to homosexuals and minorities. This prospect of a moderate presidency was further advanced, or so it seemed, by the narrowness of his election victory: having won fewer votes overall than Al Gore, Mr Bush promised to be a president for all Americans.
Now Mr Bush approaches next week's convention in New York a very different figure. The "accidental presidency" has become a transformative one (see article). The divisions within America are much greater than they were under Bill Clinton. Our YouGov poll this week shows that, although 86% of Republicans approve of what their president is doing, a mere 8% of Democrats do. Abroad, the "polarisation" is less evident only because so few Europeans are prepared to take the side of the smirking "Toxic Texan". Those "safe hands" advertised at Philadelphia four years ago--men such as Mr Cheney and Donald Rumsfeld--are now more often cast as ideological revolutionaries, often fiendish ones.
There is exaggeration in this, and often crass anti-Americanism (more on that later). But the vitriol and adoration that Mr Bush inspires both stem in part from the policies he has chosen. It is not just a matter of waging the most controversial war since Vietnam and dramatically increasing the size of government. Name your subject, from education and health care to missile defence, AIDS policy, gay marriage, stem cells and civil rights, and this presidency has sought radical change.
Promises, promises
Radicalism can be good--but Mr Bush's brand has turned a compassionate conservative into a contradictory one. What is conservative about allowing government to grow faster than under Mr Clinton? What is humble about announcing that you are trying to introduce democracy to the Middle East? Where is the compassion in his support for a federal ban on gay marriage, the limitations on stem-cell research or his other moves to accommodate the zealots of the Christian right?
In a race where Mr Kerry now seems to be the narrow favourite, the president is going to Madison Square Garden promising, in large part, more of the same. Yes, there will be an attempt to reach out to independent voters: moderates such as Arnold Schwarzenegger and Rudy Giuliani have been given prominent speaking slots. But Mr Bush is undaunted. His message is that America should stick with a man who faced hard choices and took the right decisions. Il ne regrette rien.
For this newspaper, that verdict looks mostly right for Mr Bush's foreign policy. The charge that he set off in a needlessly unilateralist direction on taking office is vastly overdone; he sought allies throughout; and in many ways his forthright style was a breath of fresh air after the muddle and evasions of the Clinton era. Yes, he dropped out of the Kyoto Protocol in a tactless way; but that was a bad treaty which America was never going to accept in any case (the Senate voted against it by a margin of 95-0). Mr Bush upset many people by ripping apart the outdated anti-ballistic-missile defence treaty with Russia--then baffled his critics by getting both Russia and (more hesitantly) China to go along with him.
But it was the thunderbolt of September 11th that counted most. Those atrocities set the course for the remainder of his presidency. Since then, we continue to think that Mr Bush has got the big foreign-policy decisions right. He understood the nature of the war that had been declared against America and the western world. He made it clear that it is not a war between civilisations, let alone religions; but he has also served notice to Arab regimes of the need to change. He rightly decided to destroy al-Qaeda's home in Afghanistan--and, yes, on the evidence that presented itself at the time, he rightly decided to invade Iraq.
Could France be mistaken?
Many of these decisions were bound to be unpopular with his allies. That does not make them wrong. Nor does it justify the anti-Americanism that many politicians have recklessly tried to stir up, particularly over Iraq. Some Bush-bashing foreign governments seem to hope that Mr Kerry will adopt a different set of priorities. Tellingly, he has stuck pretty close to Mr Bush.
To be sure, the president has got some things wrong in foreign policy. He did not outright lie about Iraq's supposed weapons of mass destruction, but he misled the country about what was known and not known. His administration exaggerated the case for invading Iraq in another way too, by falsely linking Saddam Hussein to al-Qaeda. Elsewhere, his failures have mainly been errors of execution.
He called for the establishment of a Palestinian state, but did little to support it. In Iraq, he destroyed a dangerous and odious tyrant, but lamentably failed to prepare for rebuilding the country after fighting what was, whatever Mr Bush says, a war of choice. And, in a conflict where hearts and minds count for so much and where America's reputation has been so badly wounded, the president was unwilling to acknowledge the gravity of the abuses at Abu Ghraib. That calamity warranted the resignation of Mr Rumsfeld. (The fact that a commission this week cleared him of direct responsibility for the torture is beside the point. He was the man in charge.)
The "accidental presidency" has become a transformative one
Effective execution is partly a matter of experience. There are signs, including in Iraq, that the Bush administration has learned from its mistakes. The Economist's bigger disagreements with Mr Bush lie beyond the war on terror, in areas where Mr Bush's very aims are questionable or worse.
This president, despite impassioned avowals to the contrary, has been no champion of open international markets. He caved in to protectionist pressures and imposed tariffs on steel; he also signed an absurdly bad farm bill. His fiscal policy is nothing to boast about either. Here Mr Bush can plead with some justification that, as with foreign policy, he was ambushed by events: yes, he inherited a Clintonian budget surplus, but he also had to deal with the burst Clintonian bubble. A big swing into deficit was needed, he would argue, to avoid a much worse recession. Up to a point, Mr President. Unfortunately, the Bush deficits are not temporary. They stretch into the distance: the ten-year deficit is projected at $2.7 trillion, even after a lot of dodgy accounting. He cut taxes in the best conservative tradition, but spent vastly more as well. Mr Bush is a conservative who believes in big government.
This failure to curb public spending is all the more alarming because the next president will have to prepare America for the retirement of the huge baby-boomer generation. Four years ago, Mr Bush talked, albeit tentatively, about partly privatising the pensions system; almost nothing has been done. And he has made the fiscal burden of entitlement worse by increasing the prescription-drug benefit in the Medicare system--again without undertaking meaningful reform.
The other problem is social policy. The American conservative movement has always been a marriage between "western" anti-governmentalism and "southern" moralism. Four years ago, Mr Bush made no secret of his own religious beliefs, but he gave the impression he would hold the often intolerant religious right in check. Instead, he has given it a big role in his administration on a host of issues. No doubt Mr Bush's convictions are sincere; but they were not to the fore in 2000 and they are not shared by many of those who supported him then, nor by this newspaper.
Tumultuous though it has been, and despite the passions it arouses, Mr Bush's first term should in the end be judged in the same measured way as most previous ones. It is a mixed bag: successes and failures must be set beside each other. And deciding whether Mr Bush deserves a second term calls for more than an appraisal of his own record: the American people will have to judge whether Mr Kerry, another mixture of good and bad, represents a better choice. At his convention in Boston, Mr Kerry made an effort to cast the Democratic Party in a new light. Mr Bush needs to attempt something similar in New York. More of the same just will not do.

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Regaining energy

Aug 26th 2004
From The Economist print edition
Mayo Shattuck is leading the revival of America's energy trading business
HAVING spent the 1990s reinventing themselves as whizzy energy traders, America's power utilities have been just as busy recently convincing the world they want nothing to do with the suddenly-sinful business. Yet even as former trading giants such as Dynegy, American Electric Power and Reliant make humble journeys back to their basics as slow-growing, regulated utilities, a few courageous souls have dared to persevere with trading. One is Constellation Energy, the modern incarnation of Baltimore Gas & Electric, the descendant of America's first gas utility. Led by Mayo Shattuck, Constellation has, almost unnoticed, grown to become the biggest power trader in America.
At the height of new-economy lunacy, shareholders were bestowing on America's youthful energy-trading industry the sort of gravity-defying valuations typical for stars of the bubble. Fast money rushed into the industry, fuelling unbridled expansion, a power-plant building boom and all sorts of behaviour that Americans now understand to be "excessive".
Going for gold
It was Mr Shattuck's luck to join the industry just as its fortunes went into a shuddering reverse. Following a high-flying career as an investment banker, which he crowned with the lucrative sale of his own firm, Alex Brown, to Deutsche Bank, Mr Shattuck almost took up an offer to head the US Olympic Committee. But a hankering for more work in the private sector and the prospect of dealing with the Olympic Committee's 120-strong board of squabbling directors persuaded Mr Shattuck to join Constellation instead, in October 2001. In the end, dealing with the Olympic Committee's tortuous politics might have been the more comfortable job. Within weeks of starting his new career, Enron's sudden collapse rocked the entire industry.
As a banker, Mr Shattuck had suspected before he joined Constellation that the energy-trading industry was in for a tougher time. Constellation's own energy-trading business had its roots in a 1997 joint-venture between Baltimore Gas & Electric and Goldman Sachs, an investment bank. Mr Shattuck planned to buy Goldman out, restructure the business, improve its risk management, trim the risks that its traders had been taking with shareholders' money, and hunker down.
But by the summer of 2002, the industry had gone from bad to awful. Some energy traders were mired in allegations that they had caused California's energy crisis in the winter of 2000 by rigging the markets. Congressional investigations abounded. "We didn't know how bad it was going to get," says Mr Shattuck. "We had to test our resolve." Along with Enron, all the big energy traders had "capitulated", says Mr Shattuck. As regulators, bad publicity and fleeing investors overwhelmed the industry, Wall Street firms such as UBS (which bought Enron's trading operations) and Morgan Stanley quietly cleaned up.
As Mr Shattuck scrambled to refinance and reduce the firm's billions of dollars in debt and sell $1 billion-worth of assets, he resolved to stick doggedly to Constellation's trading strategy: there would be "no retreat". With the firm's erstwhile bigger rivals fleeing the industry, Mr Shattuck figured there might be more business for him. In the 20-odd states which had deregulated their wholesale energy markets, freeing big customers to buy power from whomever they liked, Constellation's business customers would still need the risk-management services that its trading arm could sell them: a guarantee to procure energy at a long-term fixed price from a market in which price swings in the hundreds of per cent are not uncommon. The main challenge was to persuade bondholders and banks not to pull the plug on him. A gamble? "Absolutely," laughs Mr Shattuck.
Despite his efforts to shrink Constellation's debts, reduce its trading risks and embrace conservative accounting policies ahead of rule changes mandated by America's accounting regulators at the beginning of 2003, not everyone is yet convinced by his strategy. To Constellation's disgust, the latest comment on the firm's efforts by Standard & Poor's, an influential ratings agency, was to downgrade Constellation's credit rating in March, from A- to BBB+.
Mr Shattuck is unruffled. The rating agencies will come around in the end, he says. In the meantime, some of those Wall Street hopefuls that were poaching business in 2002 have since run into trouble. Fewer than 100 of the 630 traders that UBS bought from Enron remain with the firm. Morgan Stanley has had mixed results as well. Constellation's trading business, meanwhile, has flourished, and now accounts for about two-thirds of the firm's $9.7 billion of annual sales, a similar slice of its $470m annual profits, and almost all of its growth. Mr Shattuck predicts that his trading business will grow by 10-20% a year for several years to come.
Meanwhile, the stockmarket has begun to reward Mr Shattuck's dogged pursuit of trading, and Constellation is beginning to build a small and enthusiastic following: the firm's share price has almost doubled recently. As Mr Shattuck points out, despite the scandals, civil litigation and criminal prosecutions that continue to hang over energy trading, the thrust of state energy policies is still for the most part towards greater deregulation. As more big customers are freed to buy their power from merchant-energy firms, more of them will demand the sort of risk management that Constellation sells. In the long run, Wall Street's traders may find they lack the physical assets that make energy trading work. Only energy firms, he argues, can put together both the physical markets for production and transportation and financial markets for energy derivatives--and so arbitrage both efficiently. Whatever their other failings, Enron and the rest may have been on to something after all--though please don't call Constellation the new Enron.
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.

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Greenspan Sees Risk of `Painful' Changes for Retirees (Update4)
Aug. 27 (Bloomberg) -- Federal Reserve Chairman Alan Greenspan said time is running out for the U.S. to make the ``increasingly stark choices'' needed to pay Social Security and Medicare benefits as the baby boom generation retires.
``If we have promised more than our economy has the ability to deliver to retirees without unduly diminishing real income gains of workers, as I fear we may have, we must recalibrate our public programs so that pending retirees have time to adjust through other channels,'' Greenspan told a central bank conference in Jackson Hole, Wyoming. ``If we delay, the adjustments could be abrupt and painful.''
The U.S. budget deficit, which the Congressional Budget Office already projects to reach a record $420 billion this fiscal year, will widen ``substantially'' as the percentage of the population over 65 nearly doubles by 2035, he said.
``The most famous economist in the country has just put up a red flag,'' said Christopher Rupkey, senior financial economist at Bank of Tokyo-Mitsubishi in New York. ``The federal budget deficit will explode in the years to come.''
The 78-year-old Fed chairman, who was president of National Commission on Social Security Reform from 1981 to 1983, has made the retirement of the baby boom generation, those born between 1946 and 1964, a cornerstone of his persistent calls for Congress to improve budget planning.
Social Security tax receipts, equal to 12.4 percent of a worker's salary, won't cover the entire cost of outlays starting in 2018, according to the Social Security Trustees' 2004 report. That will ``significantly affect our fiscal situation.'' Greenspan said.
`Red Flag'
Social Security and the deficit are issues in the U.S. during this presidential election year. In his acceptance speech at the Democratic National Convention in Boston July 29, nominee John Kerry suggested he would consider tax increases to close the funding gap. ``As president, I will not privatize Social Security. I will not cut benefits,'' he said.
President George W. Bush, in Las Cruces, New Mexico, yesterday, said that younger workers should be ``concerned'' about the fiscal stability of Social Security, and again pitched private retirement savings. ``I believe younger workers ought to be able to own a personal retirement account they call their own, so they can pass it on from one generation to the next,'' he said.
Snow
``I'm in broad agreement with the underlying sentiments of chairman Greenspan,'' Treasury Secretary John Snow said in Grand Rapids, Michigan, repeating Bush's call for personal savings accounts where part of the withholding is diverted to a private account.
Greenspan has avoided specific endorsements of either party's proposals, and some analysts said today's speech is unlikely to produce a greater sense of urgency in Congress.
``Politicians are shy to embrace these realities because they're not very politically popular,'' said Joseph Chamie, director of the United Nations' Population Division in New York. ``No one's going to get elected on telling people they have to work longer, or pay more in taxes or see their benefits reduced.''
Birth rates have fallen around the world, leaving fewer workers to tax to finance retirement programs. And while the U.S. faces ``increasingly stark choices,'' adjustments will be even more wrenching in Europe and Japan, Greenspan said.
Europe and Japan
``Responding to the pending dramatic rise in dependency ratios will be exceptionally challenging for policy makers in developed countries,'' he told the gathering of central bankers from Europe, Latin America and Asia during the Kansas City Fed's 28th annual symposium titled ``Global Demographic Change: Economic Impacts and Policy Challenges.''
The issue may become even more pressing in middle income, or emerging-market, countries such as India, South Korea and Turkey, said Anne Krueger, first deputy managing director at the International Monetary Fund. Such nations must wrestle with financing public works, schools and social services as well as pensions.
``The challenges facing industrial countries pale besides those that emerging-market economies will encounter,'' she said.
Greenspan said the U.S. is better prepared to deal with the challenges of an aging society than Europe or Japan. Its funding shortfall is smaller, its labor markets are more flexible and better able to adapt to changing demographics, and the country is more receptive to immigrants.
Education, Productivity
Most important, companies are quicker to take advantage of productivity-enhancing technology, he said, and that will help most to close the funding gaps. Programs to encourage more output per worker are important as the labor force shrinks in coming decades.
``One policy that could enhance the odds of sustaining high levels of productivity growth is to engage in a long overdue upgrading of primary and secondary school education in the United States,'' he said.
Annual productivity gains averaged 2.5 percent from 1996 to 2001, an acceleration from the 1.6 percent average in the previous two decades. Last year and in 2002, productivity rose 4.4 percent. It was the first time since record-keeping began in 1947 that productivity exceeded 4 percent in consecutive years, according to Labor Department statistics.
Foreign investment has helped pay for much of that, Greenspan said, with the U.S. current account deficit reaching a record $144.9 billion in the first quarter.
Given that, Congress must encourage national saving, ``because it is difficult to imagine that we can continue indefinitely to borrow saving from abroad at a rate equivalent to 5 percent of U.S. gross domestic product,'' Greenspan said.
Medicare
Data show retirees save at a higher rate than had been thought, and if the baby boom generation continues that pattern, achieving a higher rate of national saving ``is not out of reach,'' Greenspan said.
``Even so, critical to national saving will be the level of government, specifically federal government, saving,'' he said.
Increased saving and higher immigration won't be enough to maintain the outsized productivity gains of recent years, he said, and that will necessitate ``difficult policy choices.''
That's particularly true of Medicare costs that will ``almost surely be much larger and much more difficult to address, he said. Medicare spending is surging with an aging population that wants the latest technologies and medicines.
Outlays are expected to more than double to $570 billion in 2010 from $280 billion last year, according to 2004 Trustees report, with expenditures beginning to exceed income in 2011.
Retirement Age
Raising Social Security and Medicare payroll taxes would suppress economic growth and tax receipts, and likely create incentives for workers to retire early ``by diminishing the returns to work,'' he said. Better would be policies ``promoting longer working life.''
In testimony last February the Fed chairman suggested Congress should consider indexing the retirement age to longevity. As an overall budgetary cure, he recommended that Congress return to a system whereby new spending programs are paid for by spending cuts or revenue increases. Today, the Fed chairman didn't endorse any specific proposals, saying only Congress must be careful in making decisions.
``How these deficit trends are addressed can have profound economic effects,'' he said. ``Changes to the age for receiving full retirement benefits or initiatives to slow the growth of Medicare spending could affect retirement decisions, the size of the labor force, and saving behavior.''
Stakeholders
Critics, including Kentucky Republican Senator Jim Bunning, say the chairman, now in his fifth term, should steer away from fiscal policy questions and keep his comments focused on monetary policy. Bunning opposed Greenspan's nomination to a fifth term objecting to Greenspan voicing opinions on subjects such as tax and budget issues that Bunning said are outside of the Fed's jurisdiction.
That is not how Fed officials see it and is why demographic change is the theme of this year's meeting in Jackson Hole.
Central bankers from around the world view themselves as stakeholders in the issue because governments are more likely to boost deficits than raise taxes to pay for retiree benefit programs.
Rising deficits might destabilize an economy by boosting the cost of capital for businesses and the cost of loans for consumers. Legislatures may also exert pressure on central banks to ease up on inflation so the real cost of the debt declines.
``Every central banker around the world will tell you we should not let that happen,'' Federal Reserve Governor Edward Gramlich said in an interview with Bloomberg News last week. ``I think we should speak out on this but I don't think we should get involved in the politics of it.''
Peril
The bond market's reaction to the looming fiscal challenge is something both traders and economists find difficult to explain. Ten-year note yields of 4.21 percent do not as yet reflect the possibility of higher deficits.
``The Fed chairman has put out a warning that the markets ignore at their peril,'' Rupkey said. ``The graying of America could force interest rates up substantially with the Fed powerless to respond.''
For Greenspan's audience in Jackson Hole, the challenge could arrive even sooner. An aging workforce is already placing demands on government resources in countries such as Italy, which spends about 14 percent of gross domestic product on pensions.
``I wish he could give that speech to both the Democratic and Republican conventions -- that's really the defining economic issue of this century,'' Robert Bixby, director of the Concord Coalition, a non-partisan budget-monitoring group based in Arlington, Virginia, said in an interview. ``This election is going to determine the first president of the senior boom, and Greenspan's remarks articulate the main challenge that the winner will face.''
To contact the reporters on this story:
Craig Torres in Jackson Hole; ctorres3@Bloomberg.net
To contact the editor responsible for this story:
Kevin Miller in Washington at kmiller@bloomberg.net
Last Updated: August 27, 2004 18:03 EDT

N. Korea suspends market reforms in full return to juche
North Korea has halted market-style economic reforms and reimposed socialistic controls, according to a former U.S. diplomat just returned from Pyongyang...

N. Korea's new take on defectors: 'Human scums' are now 'brothers and sisters who were dragged' South ...
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The North Korean Nightmare
It's Later Than You Think

By Nicholas Eberstadt, Joseph P. Ferguson
Posted: Monday, August 23, 2004
ARTICLES
The Weekly Standard
Publication Date: August 30, 2004
E. H. Carr's powerful little book The Twenty Years' Crisis presciently argued in 1939 that the events leading Europe to war were not sudden and new, but rather two decades in the making; that interwar Europe's crisis was rooted in power politics, framed by the insatiable ambitions of revisionist states, and intensified by the stubborn unwillingness of some European (and American) leaders to recognize these unpleasant but unyielding realities. Though written in another time and of another place, The Twenty Years' Crisis could be offered as briefing material today for policymakers struggling to make sense of the international drama revolving around the nuclear weapons program of North Korea.
North Korea's nuclear crisis, of course, is not exactly breaking news. If, like Professor Carr, we wish to date the duration of the crisis, we would be obliged to look back many years: perhaps to Pyongyang's November 1992 refusal to cooperate with the inspectors from the United Nations International Atomic Energy Agency (IAEA) who were attempting to reconstruct the full history of two suspect sites in North Korea's nuclear program; or to North Korea's March 1993 announcement of its intention to withdraw from the Nuclear Nonproliferation Treaty (NPT) that gave IAEA inspectors authority to pursue their inquiry; or even to the attendant March 1993 declaration by North Korea's Kim Jong Il of a "semi-state of war" and warning that "a touch-and-go grave situation has been created in which war may break out at any moment."
Indeed, the following depiction of the crisis on the Korean peninsula, written by Paul Bracken in the fall of 1993, might just as well have been published yesterday:
North Korea is in a crisis that threatens its existence. . . . The situation is extraordinarily dangerous because these are the highest stakes possible. The Korean Peninsula, moreover, is heavily militarized and lacking in crisis management capacities. Dealing with nuclear proliferation in this high-stakes setting will be much more difficult than solving proliferation problems in other countries. . . . The absolutist regime in the North has limited maneuvering room and must operate within very shaky military and economic structures. Although there are risks of pressing it too hard, a nuclear-armed North Korea would constitute the long-feared nightmare of the international community: an over-armed state in a desperate position; with unstable decision-makers and poor command and control.
To be sure, the current particulars of the North Korean nuclear crisis differ in some respects from those a decade earlier. But it is nevertheless the same crisis, shaped by the same fundamentals. And like Carr's Twenty Years' Crisis, this Korean crisis may fester for years to come. But just as in interwar Europe, the balance is inherently unstable. Some decisive event or events will finally spark dramatic--perhaps explosive--changes that profoundly reconfigure the region's security equation.
For most of the actors embroiled in the drama--the United States, South Korea, Japan, China, and Russia--the preferred outcome to the crisis would be a comprehensive and peaceful resolution through diplomatic negotiations. But in this drama, as in Europe's interwar drama, the most desirable outcome may well be the least likely. Given the character and objectives of the drama's central actor--the regime in Pyongyang--it is difficult to see how the contending interests of the principal parties could be harmonized. This is not to suggest that we shall not see international talks convened or "breakthroughs" claimed. (We have, after all, already seen plenty of that over the past decade; more of the same likely lies ahead.) It is instead to suggest that such talks and "breakthroughs" are exceedingly unlikely to defuse the ongoing crisis itself.
The North Korean nuclear crisis of 2002-2004 has been treated as a terrible surprise by practically all of the governments that have become embroiled in it. Before that eruption, it is well to remember, cautious optimism about a newly constructive attitude in Pyongyang had been spreading in international diplomatic circles for several years. And the optimists seemed to have facts on their side, for in the period between late 1999 and October 2002--that is to say, until the month Washington confronted North Korea with evidence that it was running a secret nuclear program in contravention of many pledges and treaty obligations--relations between Pyongyang and its neighbors (indeed, with the entire international community) were arguably better than at any previous point since the end of the Korean War.
Recall: South Korean president Kim Dae Jung's "sunshine policy" had resulted in the first-ever summit meeting between the Korean heads of state in the summer of 2000. Later that year, Secretary of State Madeleine Albright visited Pyongyang, the highest-level visit by any U.S. official ever to North Korea. North Korea's international attitude was judged sufficiently propitious that eight European states (including Britain, Germany, and Italy) and the E.U. chose to normalize relations with Pyongyang. In September 2002, the Japanese prime minister also visited Pyongyang. That was the first visit to North Korea by a Japanese head of state. Kim Jong Il conducted two official visits to Russia in 2001 and 2002; these had been preceded by a historic visit to Pyongyang by Russian president Vladimir Putin in the summer of 2000. Chinese President Jiang Zemin also visited Pyongyang in September 2001. North Korea even seemed to be attempting to emulate China in a brief, failed experiment to open a special economic zone on the Yalu River in September 2002.
Against such a seemingly promising backdrop, the sudden radical downward spiral in North Korea's external relations since October 2002 looks all the more dismaying--and to many, puzzling. Central to any appraisal of the unfolding crisis must be an attempt to understand the motivations behind Pyongyang's covert project to produce the highly enriched uranium (HEU) used in nuclear warheads. Some analysts regard the attempt to acquire nuclear weapons as a classic strategy to further North Korea's goal of reunifying the peninsula militarily. Others emphasize survival--a last-gasp effort to save the dying regime of Kim Jong Il. Still others see in it a combination of motives: multiple attempts to assist regime survival, to assure "existential" deterrence against the United States, to prop up regime morale, and to intimidate South Korea and Japan.
Let us first examine, however, some of the hypotheses that cannot explain Pyongyang's behavior. After the October 2002 revelation of North Korea's covert nuclear program, much sotto voce criticism in diplomatic circles implied or stated that the current crisis was caused by the United States--specifically, by the hostile posture of the Bush administration. In this telling, the White House's flirtation with a doctrine of preemption, its designation of North Korea as a member of an "axis of evil," and the president's own trenchantly expressed "personal loathing" for Kim Jong Il pressed the North Korean government to abandon a policy of conciliation and grasp for nuclear options.
Yet a quick look at the chronology of the current crisis shows that the Bush administration cannot be the proximate agent of the current impasse. To put the matter bluntly, the latest turn of the North Korean nuclear crisis did not begin with a change of attitude in Washington. Rather, it commenced when Pyongyang was caught cheating--and admitted to it!
Moreover, as Western intelligence sources now seem to agree, the secret HEU program had begun by 1997--that is to say, years before the current administration came to office. That covert program, it is worth noting, barreled forward during the halcyon days of Kim Dae Jung's sunshine policy. It was going forward as North Korea normalized diplomatic relations with the E.U. and as Secretary Albright danced in Pyongyang. And it was proceeding even as the Japanese prime minister and Kim Jong Il signed a joint declaration pledging to "observe all the international agreements for a comprehensive solution to the nuclear issue on the Korean Peninsula." The tenor of international relations, in other words, seems to have had no bearing on Pyongyang's inclination to pursue a secret nuclear weapons program.
Another unsatisfactory hypothesis--one canvassed mainly in progressive circles in South Korea--holds that the North's HEU program was actually devised as an inducement to break out of the existing diplomatic impasse with the United States, and to reach a more comprehensive settlement of the outstanding disagreements separating Washington and Pyongyang. Noting that North Korea's HEU project looks to be a slow program requiring years to complete, this argument suggests that the North's leadership chose this type of program precisely so that they could go about their game slowly and would have time to negotiate and bargain before they actually had a weapon.
Like the previous theory, this one too is empirically challenged. It neglects the hardly trivial fact that North Korea was caught out in a flagrant nuclear violation. Nuclear deceptions and nuclear violations, furthermore, are not ideal lubricants for a diplomatic breakthrough between two mistrustful governments. While it is true that slow progress in accumulating highly enriched uranium was foreordained by the decision to use many small centrifuges for the job, that choice seems to have been made to avoid detection. There is no evidence that Pyongyang would have informed its putative American negotiating partner of the HEU project if it had not been detected by U.S. intelligence.
At the end of the day, there remain a welter of alternative and in some measure conflicting theories about the intentions underlying North Korea's decision to pursue a secret nuclear weapons program. Faced with contending possible explanations for less-than-perfectly-understood events, logicians and epistemologists have long favored the most parsimonious explanation, aka Ockham's razor. To go by that approach, we might simply surmise that the drive to develop nuclear weapons reflects Pyongyang's deep desire to possess them.
It may want them for deterrence, as a national symbol, for economic benefits. It may want them as an insurance policy for state survival; as a tool in the quest for unconditional reunification with South Korea; as a means of equalizing its highly unequal contest with the United States. We may never have enough information to permit us to calibrate the relative importance of the many different possible factors that could stimulate the North Korean leadership's desire for nuclear weapons. We do know, however, that North Korean leadership plainly seems to want nuclear weapons and to want them badly. We know, for example, that North Korea has been pursuing its nuclear program for decades--and that it has built, at great expense to a very poor society, a complex and diversified nuclear infrastructure. As Joseph S. Bermudez Jr. noted shortly after the HEU effort was publicly revealed,
Given what the West knows about North Korea's nuclear programme, it is evident that it has been, and is being, pursued in a manner similar to that of China. That is, in a parallel manner, exploring multiple paths concurrently rather than in serial form with each development building on the last.
The comparison with China seems particularly instructive. Like Beijing in an earlier era, North Korea has pressed forward with its nuclear project despite desperate privation and even famine, and regardless of its impact on relations with other countries. Nor have North Korea's nuclear actions in the months since October 2002 betrayed much ambivalence about the prospect of attaining nuclear-power status: Over this period, Pyongyang has declared the U.S.-North Korean "Agreed Framework" for freezing its nuclear facilities to be null and void; has formally withdrawn from the Nuclear Nonproliferation Treaty; has expelled all IAEA monitors from its Yongbyon nuclear facility, removed all "safeguards" from the Yongbyon equipment, and opened the facility's 8,000 formerly sealed plutonium reactor rods; has announced it is reprocessing that plutonium; and has declared that its precarious military standoff with the United States is impelling it to develop a nuclear "peace deterrent."
All evidence at our disposal, in short, suggests that the North Korean leadership has treated the acquisition of a nuclear capability as an enduring and unshakable commitment, a top state priority. The troubling corollary to this analysis, of course, is that governments are not easily dissuaded from pursuing their own top priorities. The notion that the Pyongyang regime could be talked out of completing its longstanding nuclear weapons project would seem to require from students of international security something like a suspension of belief in the realities of power politics. Simply put, North Korea's arduous march toward becoming a nuclear power does not look like the sort of "international dispute" that is headed off by conventional negotiations.
Over the past two years, North Korea's neighbors have responded to the unfolding nuclear drama in varying ways. Distance from Pyongyang seems to govern these responses. The states furthest away have expressed the strongest responses, while the contiguous states have reacted rather calmly.
Considering that Russia (or rather the Soviet Union) probably had more to do with North Korea's nuclear weapons program than any other government, Moscow has seemed unperturbed by the entire situation. Rather than regarding an unstable neighbor's acquisition of nuclear weapons as a ticking time-bomb (so to speak), it has acted as if the latest crisis were an opportunity. Russian president Vladimir Putin and his foreign policy apparatus have to date treated Pyongyang's attempt to develop nuclear weapons not as a threat to international security--or to Russia's own interests--but instead as a device whereby Russia might regain its lost diplomatic foothold in North Korea, and reattain a measure of its former influence in Northeast Asia.
China remained surprisingly quiet about the North Korean nuclear issue in the months after the HEU revelations. The top Chinese leadership was already dealing with a vital domestic political issue--namely, the matter of leadership succession--and was thus more than usually loath to take an active role in a dispute involving North Korea, as Washington had been pleading for it to do. (President Bush phoned Chinese President Jiang Zemin three times in early 2003 to try to get a Chinese commitment to cooperate.) Chinese leaders are no doubt disturbed by the idea of a nuclear crisis leading to a war or the collapse of the North Korean regime. Yet until the U.S. invasion of Iraq, Beijing seemingly wished to limit its involvement in the deliberations with North Korea, and called for the United States to engage the North Korean leadership directly. Even so, China may have become impatient with the North's brinkmanship. David M. Lampton, a noted China-watcher in Washington, argued that China's leadership went from "complacent" to "apoplectic" over the North Koreans in the space of six months following the HEU revelations.
There were some fairly strong signals of Beijing's increasing displeasure with North Korea even before March 2003. The week after Pyongyang announced its impending withdrawal from the nuclear nonproliferation treaty, for example, China staged a seven-day military exercise near the North Korean border. And although the reductions were not publicly announced, Chinese trade data suggest that economic subsidies to North Korea were significantly cut between 2001 and 2002--a drop that continued into early 2003, when, in the wake of Operation Iraqi Freedom, China took the diplomatic initiative to broker multilateral talks with North Korea. (Since March 2003, China has hosted four such sessions: one round of three-way talks between Pyongyang, Washington, and Beijing, and three rounds of Six Party talks that also included Moscow, Tokyo, and Seoul.) Interestingly enough, though China has apparently used its economic leverage with North Korea now and again, it has to date consistently leaned against the threat of international economic sanctions: perhaps because Beijing fears such measures might actually undermine the North Korean regime, with untold consequences for China, or perhaps because such sanctions would be an application of pressure on the North beyond Beijing's own immediate control.
Despite Japan's reputation as an inveterate "hedger" in international crises, Japanese leaders, dealing with the aftermath of their own North Korean crisis involving Japanese abductees, moved unmistakably behind the United States on the latest nuclear crisis. When news of the North Korean announcement during Kelly's October 2002 trip became public, Tokyo immediately issued a denunciation; Prime Minister Koizumi added that the issue of normalizing relations with Pyongyang could go no further until both the issues of Japanese abductees and the North Korean nuclear program were resolved to Japan's satisfaction.
In the wake of the nuclear revelations, Japan adopted a number of uncharacteristically bold responses; surprisingly, these were met with little domestic opposition. First, in a departure from half a century of Japanese security policy, Defense Agency chief Shigeru Ishiba declared that Tokyo would advocate, and participate in, a preemptive strike against North Korea if Japan were in imminent danger of North Korean missile attack. Foreign Minister Yoriko Kawaguchi publicly supported Ishiba's position, explaining that such a move would be "within the legal framework" of the Japanese constitution, which limits military actions to self-defense. Second, after decades of tolerating such commerce, Japan moved to cut off sources of cash remittances that have been making their way into North Korea from the community of Japanese of Korean descent with ties to Pyongyang. In the Diet session that ended in June, Tokyo further stiffened its legal strictures, enabling the government to impose economic sanctions on North Korea unilaterally, and likewise summarily to ban specific ships from docking at Japanese ports.
Third, in June 2003 the Japanese Diet passed a series of war contingency bills that allow the government to assume increased powers in times of national emergency. That these bills passed with little controversy attests to the Japanese public's newly heightened concerns about security threats to their country--especially from North Korea. It should also be noted that Japan's moves were taken with little regard for public opinion across Asia, a consideration that weighed heavily on Japanese foreign and security policy in the past.
The latest round of the North Korean nuclear drama demonstrated that Tokyo has not yet mastered its habitual impulse to "hedge" in times of trouble. This past May, Prime Minister Koizumi felt compelled to make another visit to North Korea for another summit with Kim Jong Il--and to report after this s?ance that the Dear Leader "clearly" wanted to denuclearize his country. (This improbable declaration was followed a few months later by a renewed commitment of Japanese food aid for the also-unending North Korean food crisis.)
Even so: Japan's stance on the latest North Korean nuclear crisis has been practically the polar opposite of its position on the previous one. In the 1993-94 nuclear crisis, when U.S. forces were contemplating strikes against North Korea's nuclear facilities, Washington was unsure whether American planes would be welcome to land at Japanese civilian airports in case of emergency. Yet this shift in posture only signified that Japan was ready to follow on the North Korean nuclear problem. Tokyo was still unwilling and incapable of leading in a regional crisis.
The country most directly affected by the North Korean nuclear crisis, of course, is South Korea. Yet initially South Korean leaders seemed to be the least concerned with events just north of Seoul. As the crisis broke in the fall of 2002, Kim Dae Jung was already under siege for irregularities surrounding his sunshine policy: Evidence had surfaced that his government had made secret and illegal payments to the North, perhaps amounting to hundreds of millions of dollars, to secure the historic Pyongyang summit of June 2000. But President Kim was not prepared to admit that the new North Korean nuclear revelations threatened the very rationale of his beloved policy; indeed, his administration attempted to conduct business more or less as if the discovery of the HEU program had not occurred. In late 2002, South Korea was in the midst of a close, heated, and ideologically charged presidential election. A wave of anti-U.S. sentiment was sweeping the younger generation of South Koreans in the wake of the acquittal of two U.S. soldiers who had accidentally run over two young Korean schoolgirls in their military vehicle. It was obviously a less than auspicious time for U.S.-South Korean cooperation on the North Korean crisis.
The election of Roh Moo Hyun in December 2002 did nothing to dispel U.S. concerns about the reliability of its South Korean partner and ally. In the two months between election and inauguration, the Roh team did almost nothing to suggest to officials in Washington that the new administration would join the United States in confronting the North Korean nuclear problem. Doubt was expressed across South Korea that a nuclear weapons program even existed in the North, and at one point Roh himself was quoted as implying that if a war began he would keep South Korea out of the hostilities and act as a mediator between Washington and Pyongyang.
But if Roh was inclined to equanimity about the mounting North Korean threat, others whose opinion he could not ignore were not. In a blow to the confidence of the young Roh administration, Moody's Investors Service downgraded South Korea's credit rating outlook by two notches, from positive to negative, specifically citing the North Korean nuclear crisis; the ratings cut was accompanied by a significant dip in the South Korean stock market, a drop in foreign direct investment, a spike in borrowing costs, and an economic slowdown, all attributed in part to business jitters about the North Korean situation. At roughly the same time, Secretary of Defense Donald Rumsfeld broached the idea of drawing back a significant portion of U.S. troops stationed in South Korea, especially those along the demilitarized zone (DMZ). It soon became clear that this was not a trial balloon, but instead a decision already determined. The prospect of a repositioning of American forces sent a shock through the South Korean body politic--and the possibility that the Pentagon's "rationalization" plan might actually prefigure a U.S. withdrawal was greeted with almost universal dismay, even in circles that had been extremely critical of U.S. policy just weeks before.
Under these unexpected pressures, the Roh government changed course, disavowing their most memorable comments from the prior months. Prime Minister Goh Kun called for U.S. forces to remain in Korea for deterrent purposes. Army Chief of Staff Nam Jae Joon "clarified" the government's military position by specifically identifying North Korea as the main threat to the security of the South. Although this designation might seem utterly unsurprising, the fact of the matter is that the Kim Dae Jung administration could not bring itself to describe the North in such a manner for most of its time in office.
By the time Roh visited Washington in May 2003, it was clear that the new president wanted to be seen as a partner with Washington. A healthy and credible U.S.-South Korea alliance, Roh had quickly learned, was imperative not only to restore public confidence in his rule in South Korea, but also to reassure the industrial and financial communities at home and abroad that South Korea was still a safe place to do business. Thus the Roh administration found itself in the delicate position of attempting a policy of "dual appeasement": of simultaneously placating Pyongyang and Washington. It was a tricky business, depending more than a little on vagueness and official indecision. In a June 2003 summit meeting with Japanese Prime Minister Koizumi, for example, Roh concurred in the formulation that a nuclear-armed North Korea would be "intolerable": but he carefully avoided spelling out exactly what measures would be "tolerable" to prevent this eventuality.
In subsequent months the "dual appeasement" approach not only persisted, but became routinized. Thus, on the one hand, Roh would press the National Assembly to approve the dispatch of South Korean troops in support of the U.S.-led coalition in Iraq, while on the other, Roh's newly minted unification minister would urge humanitarian relief workers and NGOs not to help North Korean refugees to flee their wretched homeland, counseling instead "restraint." The dynamic of dual appeasement took a potentially momentous turn in the spring of 2004, in the wake of a clownish presidential impeachment ploy engineered by South Korea's opposition party. North Korea's media howled for punishment of the lawmakers who had favored the appeasement-prone president; at the April 2004 polls, South Korean voters duly obliged. For the very first time in the history of divided Korea, the electorate in the South had concurred with advice from the regime in the North about the conduct of their own country's domestic affairs.
The United States has remained the most outspoken advocate of a tough line with Pyongyang--no great surprise, considering President Bush's unconcealed contempt for Kim Jong Il and his administration's doctrinal support for "regime change" as an instrument of international security policy. But a harsh attitude toward North Korea and its nuclear violations should not necessarily be mistaken for a coherent and effective policy. At various points during the escalating North Korean crisis, the Bush administration's position has seemed confused, reactive, or vacillating. Indeed, three and a half years into its tenure, the administration still seems to be searching for internal consensus, with the major differences of opinion within the government, particularly between the State Department and the Pentagon, by no means completely resolved.
The end of the military campaign in Iraq was expected by some to free up policy planning time for the North Korean problem, but this does not seem to have happened. Ironically, America's most substantive initiative in Korean affairs has involved South Korea--this being the envisioned realignment of U.S. forces, with a one-third reduction of U.S. forces in Korea now slated to take place by the end of 2005. While some would argue that the impending realignment was sensible and even long overdue, no one could seriously argue that it was the most pressing problem facing the United States in the Korean peninsula at the time.
By adopting the defiant but nonetheless largely passive posture of refusing to give in to North Korean blackmail, the Bush administration seems to be looking for other nations to take the lead on Korea. Of course, this stance may pay off sooner or later. The question is: How long can the world wait? Perhaps the White House is privy to reliable intelligence that the North's nuclear weapons program is still far from its objective. One can only hope this is the case, for problems in other regions, including the Middle East, promise to occupy still more of Washington's attention in the none-too-distant future. Already another nuclear crisis, this one in Iran, threatens to overshadow the dangerous sequence of events playing out on the Korean peninsula.
The Bush administration looks to be playing a waiting game with North Korea--while North Korea seems to be busily rushing toward its goal of declared nuclear power status. The yawning gap between the problem at hand and the American response to it is palpable: Almost two years into the latest flare-up in the North Korean nuclear crisis, Washington not only lacks a solution for this acute problem, but has apparently not yet begun to fashion a feasible approach to such a solution.
Although the Bush administration has made clear its disdain for the conciliatory approach toward Pyongyang taken by President Bill Clinton, it has offered very little indication of just what should replace it. To date, the administration's most proactive response to the North Korean nuclear crisis has been the creation of a multinational Proliferation Security Initiative (PSI) for interdicting North Korean contraband abroad (an effort, it should be noted, that South Korea has declined to join).
Otherwise, the administration's record on North Korean affairs consists mainly of loudly proclaimed complaints about the pressure for bilateral negotiations with Pyongyang; of the affectation of an attitude of unconcern about North Korean threats to proceed with plutonium processing; and of taxonomic reclassification of Pyongyang to a member of the "axis of evil" from the Clinton administration's "state of concern."
Three alternative outcomes from the current impasse suggest themselves. The first would be to achieve a peaceful negotiated settlement--a diplomatic agreement whereby the North gave up its nuclear weapons program. (This is precisely what many argued Washington had arranged in the 1994 Agreed Framework, with the exchange of the Yongbyon facility for security pledges and economic incentives.) The second would be to ignore the North's extortion diplomacy and simply accept the advent of a nuclear-armed North Korea, coping with all the attendant dangers as they arise. A third outcome would be to implement and see through a strategy of regime change in Pyongyang.
The peaceful negotiated settlement is clearly the preferable outcome for most of the governments caught up in the North Korean nuclear crisis. It would be the least troubling and most immediately advantageous scenario for all of Pyongyang's potential negotiating partners. Unfortunately, the prospect of a negotiated agreement to dismantle Pyongyang's nuclear weapons program is extraordinarily remote. One may appreciate the odds against such an outcome when one considers the many obstacles against it.
One must begin with the problem of North Korean intentions. Over the past dozen years Western diplomacy has devoted no small effort to probing these. In the early 1990s, the South's Roh Tae Woo administration probed them for two years, eventually securing a Joint North-South Declaration on the Denuclearization of the Korean Peninsula in 1992. When that agreement collapsed, the Clinton administration and the U.S. government probed Pyongyang's nuclear intentions with the year and a half of diplomacy that culminated in the 1994 Agreed Framework. After 1998, in the wake of the first episode that threatened to topple the Agreed Framework, the Clinton administration probed North Korean intentions still further through what became known as the "Perry Process." And of course President Kim Dae Jung probed North Korean nuclear intentions from 1998 to early 2003 with his now-discredited sunshine policy. Reviewing this record, one might suggest we have a fairly clear idea of North Korea's nuclear intentions--like them or not. Those intentions do not exactly look conducive to a voluntary deal to denuclearize North Korea.
A second problem concerns the international precedent that would be established by a negotiated solution to the North Korean nuclear crisis. Thus far, North Korea has violated nonproliferation strictures more explicitly and provocatively than any other state--yet it has suffered no penalties for its behavior (apart from the cutoff of free oil supplies when the Agreed Framework foundered). The international community has already purchased an end to the North Korean nuclear program, through the now-moribund Agreed Framework. If it were to provide resources to shut down the North Korean nuclear project once again in a new negotiated settlement, the signal to would-be proliferators in other locales could only be destabilizing. The lesson of such a deal would not be lost on the government of Iran, or on the people of a reconstructed Iraq (whose former government was punished much more severely for much less threatening nuclear transgressions--perhaps precisely because they were not yet threatening). A negotiated settlement with rewards for Pyongyang would send a very dangerous message: Namely, swift development of a credible nuclear capability can be a savvy and profitable strategy--especially if a state finds itself in financial trouble.
Apart from all the other obstacles to a diplomatic settlement of the current nuclear crisis, there are forbidding particulars that should not be forgotten. Apart from the July 1953 armistice ending the Korean conflict--which has been upheld only through continuing force of American arms--it is hard to point to an agreement Pyongyang has abided by over its 55 years of state power. For nearly three decades, Pyongyang has been in effective default on hundreds of millions of dollars in loans it contracted in the West, and Soviet Bloc archives now reveal that North Korea routinely ignored the terms of its borrowings from Socialist creditors. North Korea has regularly and repeatedly flouted the protocols surrounding the use of diplomatic pouches, using these to transport narcotics and other illegal material to countries in which North Korean officials enjoy diplomatic immunity. The North Korean government has sponsored state terrorism in countries with which it enjoyed diplomatic relations. It has violated the territorial waters of governments who have granted it diplomatic recognition through state-sponsored shipments of drugs and military contraband. Given this history, why should anyone believe that North Korea would adhere to any new agreement--much less an agreement on nuclear arms?
The second possible outcome of the current crisis involves living with a nuclear North Korea. The United States has lived with, and outlasted, dangerous nuclear states in the past, as the history of the Cold War attests. But the costs and risks posed by a nuclear North Korea would be fearsome. The example of a North Korean nuclear breakout would encourage proliferation in other regions--and a nuclear North Korea could abet that proliferation through export of armaments, technology, and know-how. Within the Northeast Asian region, the impact of North Korea's entry into the nuclear club would also be far-reaching. More than any other modern state, Pyongyang makes its living off international military extortion; nuclear weaponry would dramatically improve the expected returns of that policy. With a hostile nuclear North Korea at its geographic center, the economies of the Northeast Asian region could not help but suffer: The business downturn that Seoul suffered as a consequence of North Korean saber-rattling in early 2003 presumably represents only a foretaste of what might lie in store for South Korea, Japan, and even China. And a nuclear-armed North Korea would necessarily and inescapably undermine the credibility of the U.S.-South Korea alliance, and the U.S.-Japan alliance--the very security architecture upon which postwar Northeast Asia's economic and political successes have been built. The erosion of deterrence in Northeast Asia could have further unpredictable, possibly cascading, consequences. None of them is likely to be pleasant.
The third possible outcome would be for the international community (or the United States) to aim for, and to achieve, regime change in the North. It is more difficult to generalize about this outcome. One can be assured that the path to regime change would be fraught with danger, and that the result, under even the most optimistic variants, would involve tremendous disruption and uncertainty. It does not require much imagination, for example, to see how a successful push for regime change could precipitate a mass exodus of starving North Koreans, whether overland into China and Russia, or by boat to Japan and South Korea. There is also a real possibility that the push for regime change in North Korea could result in war, in which case the likelihood of Seoul's escaping unscathed would seem quite small. In any event, however, a push for regime change in Pyongyang does not look to be in the cards. Whatever their other differences, the governments of China, Russia, South Korea, and Japan are today united in their aversion to a policy of promoting regime change in Pyongyang. Within the senior reaches of the Bush administration, the notion of regime change in North Korea has been discussed--but apparently, only toyed with. Occasional flirtations notwithstanding, American policy has never actually embraced the argument that regime change is either desirable or necessary in North Korea.
With no coalescence around a strategy for the North Korea problem, either in Washington or among America's partners in Northeast Asia, the situation is tilting in an incalculable direction. As during the interwar years of 1919-1939, there is an unstable equilibrium, and we are faced with an inherently dangerous situation. One additional factor makes the situation today even more dangerous than is widely appreciated: the North Korean leadership's poor decision-making record. Consider: Pyongyang's attempt to revitalize its economy in September 2002 through a vaunted "special autonomous region" for Sinuiju deteriorated into a fiasco when the project's newly chosen boss, the controversial Chinese businessman Yang Bin, was detained, tried, and convicted by Chinese authorities. In September 2002, Kim Jong Il's attempted "confession diplomacy" with Japan badly backfired, setting back prospects for North Korean-Japanese diplomatic normalization even further than they had been before the summit with Prime Minister Koizumi. This series of faux pas was followed by the nuclear tirades of October 2002 at meetings with Assistant Secretary of State Kelly that set the current phase of the North Korean nuclear drama in motion.
The most recent nuclear crisis raises further questions about the ability of the North Korean leadership to manage crises. In past disputes, the North Korean leadership consistently, and often skillfully, attempted to play off one nation against another. Today, by contrast, Kim Jong Il has managed to alienate and alarm most of his neighbors simultaneously--even though they have not yet responded to his mounting threats. To the extent one can today detect in Northeast Asia the nascent components of a coalition to punish North Korea for its nuclear transgressions, it is a prospective coalition being assembled more through the inadvertent actions of Pyongyang than through the conscious design of Washington. To quote once again Paul Bracken's 1993 study:
This [situation] is dangerous because it indicates that little learning is taking place and that North Korea is a country in which the ruler is all-powerful, but ill-informed and unrestrained by competent advice. The danger, of course, is heightened by the fact that this decision-making system has control of an enormous military force and potential nuclear force, however small. . . . What this means is that North Korea is likely to be dangerously bad at crisis management. North Korea's policy is a loose collection of eccentric ideas emanating from the top through an incoherent--yet large and deadly--security structure that is short on caution and coordination.
Bracken's admonition should be kept very much in mind by anyone attempting to envision the eventual outcome of our yet-unfinished Ten Years' Crisis with nuclear North Korea. We may hope that the world community weathers this crisis in better and wiser fashion than it did the Twenty Years' Crisis some three generations ago; the record of events to date, however, provides but fragile grounds for such a hope.
Nicholas Eberstadt holds the Henry Wendt chair in political economy at AEI. Joseph P. Ferguson is director of Northeast Asian studies at the National Bureau of Asian Research (NBR) in Seattle. This essay draws upon a longer study in NBR's Strategic Asia.
Related Links
Eberstadt's Book, "Korea's Future and the Great Powers"
More on Carr's Book
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>> KCNA

U.S. Arms Buildup under Fire
Pyongyang, August 20 (KCNA) -- The Secretariat of the Committee for the Peaceful Reunification of the Fatherland on August 19 issued information bulletin No. 882 in connection with the recent announcement made by the south Korea-U.S. "Combined Forces Command" that it would transfer a squadron of F-15E fighter bombers of the U.S. air force from Alaska to south Korea within September for the purpose of "improving the deployment capacity in case of emergency on the Korean peninsula." Such arms buildup is another dangerous move for a war of aggression against the DPRK as it escalates the tensions on the Korean peninsula and pushes the situation to the brink of war, the information bulletin said, and went on:
The U.S. is going to deploy three squadrons of F-117 Stealth fighter bombers in the Kunsan air force base of south Korea within September. It announced that it would keep two Aegis destroyers equipped with ultra-modern missile systems in the East Sea of Korea on a permanent basis and deploy two battalions of "PAC-3" in south Korea.
It also plans to supply newly developed missiles capable of underground penetration to the U.S. forces in south Korea soon before anyone else.
Such massive arms buildup which can be seen only on the eve of war clearly indicates that the U.S. preparations for a preemptive nuclear attack on the DPRK are being pushed forward at a final phase.
The U.S. is in the process of ordering its forces to take their positions for launching an attack while openly revealing their adventurous attempt for a war against the DPRK, going against the aspiration and desire of all the Koreans and the world people for peace and stability on the Korean peninsula. This compels the army and people of the DPRK to take self-defensive measures to counter them.
The U.S. warhawks are well advised to properly understand the will of the army and people of the DPRK to wipe out the enemy, stop acting rashly and discontinue at once their reckless arms buildup and war exercises against it.



. FM Spokesman Assails North-Targeted Military Exercise
Pyongyang, August 20 (KCNA) -- A spokesman for the Foreign Ministry of the DPRK issued a statement Friday in connection with the "south Korea-U.S. Combined Forces Command's" announcement that Ulji-Focus Lens-04 joint military exercise would be staged from August 23 to September 3. The projected exercise is another grave challenge to peace and security on the Korean peninsula as it is a replica of the Team Spirit joint military exercises aimed to examine and improve all aspects of the preparations for a war of aggression against the north, the statement noted, and continued:
The U.S. has so far pretended to have any intention to seek a peaceful negotiated settlement of the nuclear issue with the DPRK, asserting whenever an opportunity presented itself that it has no will to invade or attack north Korea and that it pursues no hostile policy toward it. The projected saber-rattling once again proves that all what the U.S. has publicized is nothing but hypocrisy and the Bush administration's reckless strategy of preemptive attack has been put into the phase of implementation after going beyond the phase of discussion.
The U.S. evermore undisguised moves for war are little short of destroying the basic foundation for the six-party talks to seek a negotiated solution to the nuclear issue on the Korean peninsula.
The DPRK will never react to such enemy saber-rattling with such foolish option for disarmament.
Its army and people will never be browbeaten by the U.S. threat and blackmail but react to its hard-line with a tougher stand.
Now that the U.S. scenario for a war of aggression against the DPRK has entered the phase of its implementation, the DPRK is left with no option but to increase its war deterrent force both in quality and quantity.
If the Bush group launches a war, underestimating the will of the DPRK, it will not have even a chance to regret for its rash act.
The south Korean authorities should bear in mind that they would have to pay dearly for such treacherous acts as joining the U.S. in its north-targeted exercises.


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DPRK: talks "impossible" due to US hostile policy
www.chinaview.cn 2004-08-23 11:28:54
PYONGYANG, Aug. 23 (Xinhuanet) -- The Democratic People's Republicof Korea (DPRK) said Monday that the meeting of the working group for six-party talks is "impossible" due to the US' hostile policy toward Pyongyang.
"The US has become more undisguised in pursuing its hostile policy toward the DPRK, backtracking on all agreements and common understandings reached at the third round of the six-party talks,"a DPRK Foreign Ministry spokesman said in a statement carried by the Korean Central News Agency (KCNA).
KCNA said that during his recent election campaign in Wisconsin State, US President George W. Bush "asserted that it is necessary for the US, China, Japan, South Korea and Russia to unite and they are urging 'the tyrant' to disarm himself."
The DPRK spokesman described Bush as a "political imbecile," accusing him of hurling "malignant slanders and calumnies" against the DPRK leadership.
"This made it quite impossible for the DPRK to go to the talks and deprived it of any elementary justification to sit at the negotiating table with the US," he added.
Representatives from China, the DPRK, the United States, South Korea, Russia and Japan held their third round of talks in Beijing last June on the issue of the Korean Peninsula. Enditem

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>> ANOTHER EBERSTADT PIECE


Four Surprises in Global Demography
By Nicholas Eberstadt
Posted: Friday, August 20, 2004
ON THE ISSUES
AEI Online
Publication Date: August 20, 2004
Sub-replacement fertility rates are becoming the norm throughout much of the world. Specific nations--some poor, some wealthier--are experiencing unusually high mortality rates and unnatural gender imbalances. Almost alone among developed nations, the United States continues to grow.
Contemporary world population patterns are shaped by the "demographic transition" concept introduced to the field by the great demographer Frank Notestein several generations ago. That schema offers a stylized description of the great shifts in modern population patterns. Death and birth rates start out high, but more or less in equilibrium. Then, advances in knowledge and improvements in income result in broad declines in mortality, precipitating rapid population increase. Finally, socioeconomic development brings about sustained fertility reductions via voluntary, deliberate changes in childbearing patterns, at which point births and deaths once more come into balance.
While Notestein's schematic may still describe the human condition in broad stroke, today we can observe some important and surprising exceptions to these generalizations. Four of these unanticipated trends are (1) the rapid spread of sub-replacement fertility, (2) the emergence of unnatural gender imbalances among the very young, (3) sustained increases in death rates, and (4) American "demographic exceptionalism."
Sub-Replacement Fertility
Sustained reductions in family size in the context of peace and social progress were first witnessed in late eighteenth-century Europe. In the first half of the twentieth century, European countries unveiled another demographic first: non-catastrophic sub-replacement fertility. During the interwar period, a number of European states reported fertility patterns that, if continued, would lead to an eventual stabilization and indefinite population decline thereafter, absent offsetting immigration. These low fertility regimens were entirely voluntary: heretofore, such low birth rates had virtually always been attended by war, pestilence, famine, or disaster. Europe experienced a baby boom after World War II, but sub-replacement fertility has now returned with a vengeance.
To maintain long-term population stability, a society's women must bear an average of about 2.1 children per lifetime. According to projections of the U.S. Census Bureau, Europe's total fertility rate (or TFR-births per woman per lifetime) is about 1.4. Indeed, nearly all the world's developed regions--Australia and New Zealand, North America, Japan, and the highly industrialized East Asian outposts of Singapore, Hong Kong, Taiwan, and South Korea--are reporting sub-replacement fertility. (Israel remains an exception.) But sub-replacement fertility is clearly no longer mainly a developed-nation phenomenon. If the Census Bureau's projections are roughly accurate, just about half the world's population lives in sub-replacement countries or territories.
Apart from Mongolia, according to the Census Bureau, all of East Asia is sub-replacement, as are Thailand and Burma in Southeast Asia, Kazakstan and Sri Lanka in South Central Asia, many Caribbean societies, and most South American countries.
Perhaps the biggest surprise, given received notions about the Arab-Muslim expanse, is the recent spread of sub-replacement fertility to parts of the Arab and the Muslim world. Algeria, Tunisia, and Lebanon are now sub-replacement countries, as is Turkey. And there is the remarkable case of Iran, with a current TFR of under 1.9, which is lower than that of the United States. Between 1986 and 2000, the country's TFR plummeted from well over 6 to just over 2. If modernization and Westernization are the handmaidens of sustained fertility decline, as is often supposed by students of demography, both terms are apparently being given a rather new meaning.
There are no reliable methods for anticipating just how low fertility levels may sink, or how long sub-replacement fertility may persist in various locales. One consequence, however, is already clear: it will force a great aging of the populations affected.
All of the developed countries are already "graying." This is most pronounced in Japan, where, by the year 2025, it is expected that one out of nine people will be eighty or older. Japan's prospective aging is unprecedented, and the scale of the transformation suggests the enormousness of the challenges that will accompany it. Japan, Europe, and North America are places where people traditionally got rich before they got old. In the decades ahead, many national populations are going to get old before they get rich.
China promises to be the most important case in point. Thanks to low levels of mortality, its population control program, and its now-low fertility, China is aging at a breathtaking velocity. Between 1975 and 2000, China's median age jumped from just over twenty to about thirty; by 2025, it is projected to rise by nearly another decade. By then, it is quite possible that China's median age will be higher than America's. But China is much poorer than Japan or the United States were at every comparable stage of their aging processes.
China's rapidly aging population faces a looming triple bind. Apart from the family, China lacks any functional nationwide arrangements for pensioning its elders. Thus, a great many Chinese will have to continue to work into old age. But working life in China typically entails more physical labor, which does not favor the frail, than work in Japan or the United States. China's aging problem has the makings of a slow-motion humanitarian tragedy.
Unnatural Gender Imbalances
China is also witnessing a strange, unnatural, and growing disproportion between its numbers of baby boys and baby girls, and it is not the only country in which this is happening. In ordinary human populations, around 104-105 boys are typically born for every 100 girls. However, since the advent of its coercive one-child policy, China has broken this natural biological rhythm. Its 1982 census counted almost 109 baby boys for every 100 baby girls; by 1995, the reported ratio was up to almost 116 boys for every 100 girls, and by 2000, it was approaching 120 boys for every 100 girls.
This astonishing ratio could be a consequence of massive statistical falsification as parents bend the rules of the population program by concealing baby girls. If so, one would expect to see more normal sex ratios at slightly older ages: say, the years one through four. But even here, China's registered ratio of boys to girls was about 121:100, and the ratio exceeded 130:100 in several provinces.
And China's mounting gender imbalance cannot be explained by poverty or lack of education. It has emerged in a period of extremely rapid development and pronounced economic progress. Moreover, higher female illiteracy rates correspond with lower imbalances: better education for women is a predictor for greater gender imbalances.
China's population control program stands as an obvious suspect since the imbalances did not emerge until after the plan was promulgated in the late 1970s, and the imbalances have grown progressively worse during the years of its implementation. Yet this policy cannot be the sole culprit.
In other parts of East Asia, including South Korea, Taiwan, Hong Kong, and Singapore--none of which forcibly control population growth--unnatural gender imbalances at birth have also been recorded in recent years. It may be that throughout East Asia we are witnessing a collision between an immensely strong cultural preference for sons, new regimens of sub-replacement fertility, and a diffusion of ultrasound and other technologies that permit prenatal gender determination. Skewed sex ratios at birth would be the inexorable consequence of this collision.
And the collision is not only happening in East Asia. Gender determination technology is now nearly universally available; sub-replacement fertility is fast becoming the planetary norm; and a strong son-preference has been expressed in a number of cultures worldwide. One of these is Punjab, India. In a major survey undertaken there a decade ago, when fertility levels were still well above replacement, ten times as many women expressed a preference for a boy as for a girl. And according to India's latest census, in that state's youngest age groups, there were 126 young boys for every 100 young girls. That figure cannot be taken as an exact indication of gender imbalance at birth: differential mortality and/or migration, for instance, may have affected this reported outcome. Yet the true sex ratio at birth in Punjab may not be far different from the extraordinary disparities reported for the very young. Contrary to expectation, with increased affluence, education, and contact with the outside world in China, the gender imbalance has increased, and it is starting to do the same in the Caucasus, parts of Latin America and Eastern Europe, and even subpopulations within the United States.
The consequences of this growing gender imbalance will be felt when these children grow to be prospective husbands and wives. The "marriage market" will be unable to clear in locales where matrimony is the expectation, sub-replacement fertility the reality, and extreme gender imbalances the norm.
Sustained Increases in Mortality
It has generally been assumed that with improved income, increased globalization, and the attendant spread of ideas, knowledge, and technology, mortality would gradually decline worldwide, and countries' mortality levels would gradually converge. Most of the twentieth century seemed to confirm such expectations. Between 1900 and 2000, global life expectancy at birth probably doubled, soaring from about thirty to well over sixty years. And from
1950 to 1980, there was a marked convergence of life expectancy between the more- and less-developed nations.
In the twenty-first century, it appears that major and pervasive health setbacks will be a characteristic feature of the global population profile. These steep increases in mortality do not seem to be transitory, but will probably continue for decades. By U.S. Census Bureau projections, over forty countries are anticipated to have a lower life expectancy in 2010 than they did in 1990. The Bureau envisions a twenty-year-long decline in life expectancy for those countries. Clearly these are no trivial interruptions.
Most of the health setbacks relate to HIV/AIDS, which is the proximate factor in virtually all of these reversals in sub-Saharan Africa. But it is not the only, or even the major, factor elsewhere. Most of the former Soviet countries, for example, are projected to suffer long-term declines in life expectancy.
The Russian Federation is perhaps the most striking and anomalous of the states suffering from long-term health retrogression. Russia's life expectancy at birth today is about four years lower than it was forty years ago. Its health reversal is concentrated in the working age groups. This peacetime death explosion has been triggered not by tuberculosis or HIV/AIDS, but by cardiovascular disease and injuries. Alcohol, of course, has played its part; indeed, one Russian study determined that almost half of the young and middle-aged men who died of injury or cardiovascular disease were drunk at the time of death. Russians now in their thirties, forties, or fifties have already accumulated a lifetime of insults to their health.
In Japan, each new generation enjoys better survival chances at any given age. The situation is totally different in Russia, where the worst death rates at any given age are found among the youngest men. To judge by mortality, Russians are now less healthy than their parents were at the same age. Under such circumstances, it will be extraordinarily difficult to improve the health of the society as a whole.
American "Demographic Exceptionalism"
A final surprise involves what we might call America's "demographic exceptionalism." The United States is the singular and major exception to the demographic rhythms characterizing virtually all other affluent Western states.
In Western Europe, total populations are anticipated to decline between 2000 and 2025, with a substantial shrinkage in the under-fifty-five population and pronounced population aging. In the United States, overall population aging is much more moderate; the overall population is projected to increase, and a higher number of young people are expected in 2025 than today.
Part of this difference is attributable to a significant divergence in fertility patterns. As already noted, Europe's overall TFR stands in the 1.4 to 1.5 range, with Italy and Spain on the low end, at about 1.2, and France and Ireland on the high end, at about 1.8. The U.S. fertility rate has been over 2.0 since 1990 and is just under replacement today--somewhere between 2.0 and the 2.1 replacement level, making it about 40 percent higher than Europe's.
America's fertility levels have diverged not just from Europe's but from those of the rest of the developed world. The U.S. TFR is much higher than Japan's 1.3-1.4, and the gap is even greater with some of the other high-income East Asian countries. Even much of North America does not look so "American" these days: whereas the United States and Canada had nearly identical fertility levels back in the mid-1970s, Canada looks pretty European today, and the United States looks--well, pretty American. While the States is reporting a TFR of over 2, Canada's is around 1.5.
Much of the developed world is caught up in what Ron Lesthaege and Dirk van de Kaa have dubbed "the second demographic transition"--a shift to smaller desired family sizes and less stable family unions. If this is the new demographic revolution, Americans look to be the developed world's most prominent counterrevolutionaries.
America's relatively high TFR does not seem to be explained by any particular region or ethnicity. There are big fertility differences between some states, but forty-two states reported TFRs above 1.9 that year, and thirty-three reported TFRs of 2.0 or higher. In all of Europe, by contrast, the only country with an estimated TFR above 2.0 is Albania.
America's ethnic fertility differentials do not account for its demographic divergence from Europe. Hispanic Americans maintain relatively large family sizes in the United States, with a TFR of around 2.7, but excluding them by no means eliminates the gap between the United States and the rest of the developed world. Nor can the differential be explained by factoring out African-American fertility (which is higher than the "Anglo" rate, but much closer to the Anglo rate than to the Latinos'). In 2000, America's Anglo TFR was 1.84--about 10 percent less than the U.S. national average, but still more than 30 percent above Europe's.
So how can we explain this fertility discrepancy? Possibly it is a matter of attitudes and outlook. There are big revealed differences between Americans and Europeans regarding a number of important life values. Survey results highlighted in The Economist (November 2003) point to some of these. Americans tend to identify the role of government as "providing freedom," while Europeans are inclined to think of government in terms of "guaranteeing one's needs." Attitudes about individualism, patriotism, and religiosity seem to separate Americans from much of the rest of the developed world. Is it entirely coincidental that these divergences seem to track with the big cleavages between fertility levels in the United States and so much of the rest of the developed world?
The difference between a TFR of 2.0 and one of 1.5 or 1.4, other things being equal, is the difference between virtual long-term population stability and a population that shrinks by almost a third with each passing generation. A UN Population Division study estimates what levels of net immigration flows would be necessary for developed countries to maintain both their overall population and their working-age population (15-64 years of age) over a fifty-five-year horizon.
For the pre-enlargement European Union, a net inflow of about 2.5 million people a year would be needed to stabilize the population, and about 4.3 million to stabilize the workforce. But net immigration into the European Union in the late 1990s averaged just 700,000 a year. For Japan, 300,000 net newcomers a year would be needed for population stability, and 600,000 for workforce stability. But Japan's net immigration rate today is approximately zero. The United States could maintain its population with just 116,000 net immigrants a year, but net annual immigration has averaged nearly 1 million. If these exceptionalist trends continue, America will age much more slowly than Europe or Japan. And the U.S. share of world population will not diminish steadily and dramatically in the decades ahead, as Europe's and Japan's seem set to do.
Western European countries accounted for about 12 percent of global population in 1950; this was down to about 6 percent by 2000, and in the admittedly tentative Census Bureau projections for 2050, it is placed at barely 4 percent. Over this same span, Russia's projected share of world population falls from over 4 percent to barely 1 percent; Japan's from 3 percent to 1 percent. The United States, on the other hand, only drops from about 6 percent in 1950 to about 4.5 percent in 2000 and then is projected at an almost constant 4.5 percent for the following half century.
While the rest of the developed areas gradually drop off the roster of the world's major population centers, the United States actually rises, from fourth largest in 1950 to third largest in 2000, which it is projected to remain in 2050 as well. Drawing international implications from such crude comparisons is hazardous. But from a purely demographic standpoint, the United States, virtually alone among developed nations, does not look set to be going off gently into the night.

Nicholas Eberstadt is the Henry Wendt Scholar in Political Economy at AEI.

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>> CHINA



Use the Free Market to Solve China's Water Shortage
By Roger Bate
Posted: Friday, August 20, 2004
ARTICLES
Wall Street Journal Asia
Publication Date: August 20, 2004
Financial and labor constraints may be the current focus of concern, but a far greater threat to China's long-term economic growth lies in its lack of attention to ecosystems. China's surface water is rapidly depleting, and Charles Wolf of the Rand Corporation estimates such water shortages could indefinitely lower annual growth by as much as 2%.
China could solve this problem by adopting a system of environmental property rights. Having successfully incorporated market forces into other areas of its booming economy, it's time to extend the same approach to the environment. China's leadership needs to understand that market mechanisms can protect the environment every bit as effectively as they boost the production of CDs and cars.
That's a task made more difficult by the human-rights and green groups who undermine their own credibility by opposing dam development as a matter of principle. From the Three Gorges in China to the Narmada Dam in India, these groups ignore the benefits such projects can bring, such as generating electricity, reducing the risk of flooding and providing better irrigation for food production. Their exaggerated approach obscures the valid concerns about the dangers of ecological catastrophe, and the rights abuses caused by the often forcible removal of tens of thousands of inhabitants.
China's development patterns resemble those in the U.S. and Britain in the early 20th century, when pollution was viewed as the inevitable price of growth. That's a common attitude in China today. For example, one Chinese businessman told me that pollution is a "price worth paying"--an opinion shared by many local officials. So why is China now facing a far greater ecological danger than those Western countries experienced when they went through similar phases of rapid development earlier this century? The reason is that in the U.K. and the U.S., individuals had ownership rights over their local environment, even if they weren't always enforced. Ordinary Chinese, on the other hand, have never had those rights.
In building the Three Gorges, China has embarked on the largest dam development program the world has ever seen. Yet although 70% of China's water supply is used for agricultural purposes, China's food production is not benefiting as much as it should. The efficiency level for crop production (the amount of water absorbed by plants and not lost to evaporation) is less than 50%, compared with 65% in the U.S. Part of the reason is that many of China's irrigation schemes were hastily designed, poorly constructed and built with inferior materials. Another reason is that China's massive size and population exacerbate the degree of damage done by any policy failure.
Efficient water use is also closely linked to a system of property rights. English common law, for example, gives all landowners the right to demand that water flowing past their land remains in decent, natural condition. By the 1960s, lawsuits brought by individuals against polluters in the U.K. had led to the cleaning up of many rivers, long before government agencies added a layer of bureaucracy to such efforts.
In the U.S., river water is effectively owned by local landowners and fishermen in places like Montana and Utah. Although excessive federal government regulations often makes it difficult to trade, or even exercise, such rights, their very existence can empower individuals and act as a constraint on still greater government interference. And in many other countries, from Chile, to South Africa, Mexico, India and especially Australia, allowing individuals to own water rights has benefited the poor and helped to improve the environment.
In the absence of such free-market solutions, China's rapid development has brought it to the brink of ecological disaster. Pan Yue, vice minister of the environment, addressed the problem at a recent news conference: "China's population resources and environment have reached the limits of their capacity to cope. If we continue on this path of traditional industrial civilization, there is no chance that we will have sustainable development."
This problem cannot be solved until China allows local people, especially farmers, to own their water and trade usage rights. Allowing them to do so would ensure more efficient farm production, and lead to less water waste. Over the long-term, ownership rights can empower people and lead to political pressure for change.
As Russia is discovering, it's not possible to throw off the shackles of communism and then confine yourself to the bits of capitalism that appeal to the current oligarchs. Success will require the discipline of the market as much as the opportunity and growth it brings, and growth without responsibility is not sustainable.
Roger Bate is a visiting fellow at AEI.
----------------------------------------------------

Nine laws to be amended to limit govt power
www.chinaview.cn 2004-08-24 00:45:27
BEIJING, Aug. 23 (Xinhuanet) -- China's legislature is considering amendments to nine laws, including the highway law, the corporate law and the auction law, to limit and further legalize government's involvement in social and economic affairs.
"Some of the clauses in the existing laws do not conform with the Administrative Licensing Law and the requirements of shifting government function and reforming the administrative system. They should be canceled or revised," said An Jian, deputy director of the Commission of Legislative Affairs of the Standing Committee ofthe National People's Congress (NPC).
The drafts of the amendments, which will be discussed at the ongoing 11th meeting of the Standing Committee of the 10th NPC starting Monday, include the following adjustments:
-- To establish an auction enterprise, the applicant no longer needs approval of the public security department as previously required.
-- To establish a hunting ground open to foreigners, the applicant no longer needs approval of the wildlife administration department. However, the applicant is still obligated to register the project in the wildlife administrative department.
-- After gaining the approval of an authoritative expert panel,sales of new breeds of aquatic products no longer needs the approval of the fishing administration.
"All the draft amendments are aimed at restricting the government's scope of power and simplifying the procedure," said Wu Jiang, professor of the National School of Administration.
The Chinese government attaches great importance to the reform of the administrative licensing and has been vigorously pushing the reform.
Since October 2002, the State Council has abolished or adjusted 1,795 items formerly subject to administrative approval, nearly a half of the total handled by departments of the State Council. Enditem
---------------------------------------------------------------

>> IRAN

Iran boasts Dimona now 'within range'
By Abraham Rabinovich
THE WASHINGTON TIMES
JERUSALEM -- The distribution of anti-radiation pills to residents near Israel's nuclear reactor at Dimona last month caused more puzzlement than panic. There had never been a known radiation leak from the facility and there were no signs of war that might pose a near-term risk to the reactor.
Pronouncements from military chiefs in Tehran and Tel Aviv, however, have cast the pill distribution in a new light.
"The entire Zionist territory, including its nuclear facilities and atomic arsenal, are currently within range of Iran's advanced missiles," Yadollah Javani, the head of the Iranian Revolutionary Guard's political bureau, declared last week.
He was speaking after a test-firing of the ballistic Shihab-3 missile. With a range of 800 miles, it can reach any target in Israel, most particularly Dimona.
Mr. Javani said threats had been made by U.S. and Israeli officials to disrupt Iran's nuclear program. But with Israel now covered by the Shihab missile, he said, "neither the Zionist regime nor America will carry out its threats."
Gen. Moshe Ya'alon, the Israeli chief of staff, sounded no less pugnacious in an interview in the newspaper Yediot Ahronot. Iran's nuclear development, said the general, must be halted, one way or another, before it proceeds much further.
"Iran is striving for nuclear capability," he said, "and I suggest that in this matter [Israel] not rely on others," a clear reference to diplomatic efforts by the United States and European powers to get Iran to give up its ambitions.
Gen. Ya'alon noted that Israel had eliminated Iraq's nuclear reactor in 1981, destroying the facility in a long-range air attack just before it was to come on line. Imagine what it would be like, said Gen. Ya'alon, if Saddam Hussein had been permitted to achieve a nuclear capability.
Israeli officials say the diplomatic efforts have succeeded in slowing down Iran's nuclear development by about two years. An intelligence assessment made to the Israeli Cabinet last month said Tehran will be able to produce enriched uranium on its own for nuclear weapons in 2007, not in 2005 as previously thought.
However, an unusual sense of urgency was attached to the distribution of Lugol anti-radiation pills by the Defense Ministry and the Israeli Atomic Energy Commission. The agencies sent soldiers from house to house in two towns near the Dimona reactor and from tent to tent in adjacent Bedouin areas instead of keeping them stored in a regional facility until needed.
An air strike against Iran's nuclear facilities is well within Israel's operational capacity. A major reason its air force purchased F-15Is from the United States in the 1990s was to have a warplane capable of operating over Iran. Israel's Ofek satellite presumably is able to provide updated intelligence information on Iran's nuclear sites.
If Israel carried out an attack, it almost certainly would be done before Iran activated the reactor so as to avoid radioactive fallout that would endanger civilian areas. It is the political and strategic fallout that Israel would have to consider before undertaking such an attack.
Israel fears that some moderate and even friendly countries in the region might change their policies if they thought they could hide under an Iranian nuclear umbrella. "If Iran has nuclear capability," said Gen. Ya'alon, "it would be a different Middle East. Moderate states would become more extreme."

----------------------------------
Iran Plans to Build 2nd Nuclear Reactor
NewsMax Wires
Monday, Aug. 23, 2004
TEHRAN, Iran -- Iran said Sunday that it plans to build a second nuclear reactor with Russia's help and that at least two other European states have expressed interest in such a project, brushing aside U.S. accusations that the Islamic state wants to build atomic weapons.
Russia is building Iran's first nuclear reactor, which was begun by West Germany but interrupted during the 1979 Islamic revolution. Damage caused to the nearly completed facility in Bushehr during Iran's 1980-88 war with Iraq also led to the postponement of its planned inauguration from 2003 to August 2006.
Despite the delays and the project's $800 million cost, Iranian nuclear officials say they want Russia to build more nuclear reactors to help generate greater amounts of electricity.
The comments Sunday reflect Iran's determination to push ahead with its nuclear program despite U.S. and international concerns that it seeks to develop nuclear weapons.
The United States has been lobbying for the International Atomic Energy Agency to refer Iran's nuclear dossier to the Security Council, which could impose sanctions. Tehran denies seeking to develop weapons.
Asadollah Sabouri, deputy head of the Atomic Energy Organization of Iran, did not say when construction might begin but insisted Russia was obligated to build more than one nuclear reactor under a 1992 agreement between the two countries.
"We have contracts with Russia to build more nuclear reactors. No number has been specified but definitely our contract with Russia is to build more than one nuclear power plant," Sabouri said, adding that Tehran has carried out several studies and technical reports for the construction of new facilities.
Despite U.S. pressure, Russia has been reluctant to abandon the nuclear reactor refit project at Bushehr, a coastal town in southern Iran.
Unaware of Contracts
The spokesman for Russia's Federal Atomic Energy Agency, Nikolai Shingaryov, told The Associated Press by telephone that he was unaware of contracts for Russia to help build any more reactors. He said the two countries have held discussions on building a second one, as called for in the 1992 agreement, but an actual contract would be needed to begin construction.
Sabouri said later that Russia will build a second reactor in Bushehr and that Iran is studying other sites here for more possible reactors. Most areas in Iran are prone to earthquakes, restricting choices for setting up nuclear facilities.
He also said at least two European countries had expressed interest in the projects, but refused to name them.
"They have given us documents expressing their readiness to join the projects. We welcome them. My message to the Europeans is that we have to pass the paperwork stage and go for binding contracts as soon as possible," he said.
Iran insists it is only pursuing nuclear technology to produce electricity.
"By 2021, Iran's electricity consumption will reach 56,000 megawatts and we need to have capability to produce 70,000 megawatts of electricity. Some 7,000 megawatts, about 10 percent, will be met through nuclear power plants," Sabouri said.
Sabouri said the first Bushehr plant is expected to be operational by August 2006. It had initially been scheduled to open in 2003, but Sabouri said repairing damage from the eight-year war with neighboring Iraq, meeting safety regulations and redesigning the reactor has taken longer than expected.
Sabouri said the Bushehr complex has the capacity to house at least four nuclear reactors.
During the Iran-Iraq war, work on a second nuclear reactor in Bushehr was partly completed before it sustained heavy damage during fighting. Sabouri said it was unfeasible to repair and rebuild that facility and Iran planned to construct a new reactor next to it.
Another possible site for building new nuclear reactors would be Darkhovein, a city close to the Arvand River in Khuzestan Province, southwestern Iran, Sabouri added.
He also said Russia must provide Iran with nuclear fuel by the end of 2005 at the latest, or the Bushehr plant's inauguration will be delayed.
Tehran and Moscow have agreed to return the spent nuclear fuel to Russia.
"There is no ambiguity on returning the spent fuel. The Iranian government has already made the decision to return the spent fuel back to Russia. What we haven't agreed on with Russia is the expenses," Sabouri said.
? 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.


-----------------------------------
Iranian hand in Najaf game
By Claude Salhani
Since the battle of Najaf suddenly erupted about two weeks ago, with fierce fighting raging between followers of Shi'ite maverick cleric Moqtada al-Sadr and the U.S. military, the question often arose as to why this battle was taking place.
Just what is the firebrand Sheik al-Sadr trying to prove? It must seem genuinely insane to try to take on the full brunt of American military with its advanced technology, unlimited hardware and far superior firepower. Not to mention the recreated Iraqi army units fighting beside American forces.
So what exactly does Sheik al-Sadr expect to achieve other than the senseless killing, mostly of his young fanatical fighters, who are no match for the better-trained and -led American forces, and who are dying by the score?
To establish the "why" of the fighting in Najaf, one must first try first to ascertain the "who." Who stands to profit from the turmoil? Who could be pulling Sheik al-Sadr's strings and, of course, to what end?
The answer, no matter how you turn this thing around, dissect and analyze it, seems to point in one direction: Iran.
Sheik al-Sadr has traveled twice to Iran in recent months. He maintains close links with Ayatollah Kazem al-Haeri, a cleric in the city of Qom and a close confident of Iran's supreme leader Ali Khamenei. Analysts believe he receives support and most probably financing from Iran.
And just why would the Islamic republic want to direct Sheik al-Sadr and his Mahdi Army to foment strife in Iraq, stirring up trouble for U.S. forces? Sure, they are killing American soldiers, but for every American casualty, there are close to 50 Iraqis.
Also, as one analyst noted, you never want to ignite a fire in your neighbor's house for fear it might spread to yours -- unless there is a compelling reason.
The reason is the Iran's ayatollahs are sending Washington a message. The message is "make sure that you, Washington, will convince Israel to stay away from our nuclear sites and desires." Otherwise, the fighting currently under way in Najaf can easily expand to other localities and grow in intensity. Lives are, unfortunately, expendable in this part of the world.
Remember Iran's children brigade sent out in front of regular troops to clear minefields during the 8-year Iran-Iraq war. The children were armed with Islamic fervor and promises of a place in paradise. Close to a million people died in that conflict.
This is the kind of adversary the United States military is likely to face in an open confrontation with Iran, if it ever comes to that. And now, with 148,000 American troops serving in Iraq, the U.S. finds itself sharing a 1,215-mile border with the Islamic Republic of Iran --a porous border across which thousands of Revolutionary Guards can easily infiltrate and instigate trouble.
There has been much talk lately over the probability of a replay of Israel's 1981 raid on Iraq's Osirak nuclear facility. This time the target would, of course, be Iran's facility, probably the Bushehr plant. Ergo the not-so-veiled threats to the United States carried out by Sheik al-Sadr's boys in Iraq. "We can make trouble for you," the Iranians seem to say. And they can.
In 1979, shortly after the Islamic revolution overthrew the shah and installed a theocracy in place of the Peacock Throne, Iranian students stormed the "nest of spies," the U.S. Embassy in Tehran, and held its diplomats and Marine guards hostage for 444 days. There was little, if anything, the U.S. was able to do.
One military rescue was attempted. It ended in disaster with the crash of two U.S. helicopters and the death of the rescuers.
Iranians are well aware of the dangers ahead as they cruise toward the the point where they will have acquired weapons-grade plutonium, enough to fabricate a nuclear bomb.
Iranian Revolutionary Guards Commander Maj. Gen. Yehya Rahim Safawi warned Iran would strike at Israel, making it "painful" if Israel attempted to hit Iran's interests.
"The Islamic Republic will strike with force at the Zionist entity [Israel] if it commits the stupidity of hitting the interests of the Iranian people," Gen. Safawi said, according to the Iranian News Agency, IRNA.
Gen. Safawi accused Israel and the United States of turning the Middle East into a "hot spot for disseminating and spreading evil, and strife and for oppressing Muslims."
"Israel and America are trying to implement their malignant plans under the pretext of curbing weapons of mass destruction and combating terrorism with the fake aim of spreading democracy in the Middle East," he said.
On his part, the deputy commander of the Republican Guard echoed similar warnings. "We will respond firmly and by all means to anyone who dares to attack any region of our country," Brig. Mohammed Zou al-Kader said.
"The psychological war waged against us is aimed at intimidating the officials and stopping Iran from keeping up efforts to acquire nuclear technology for use in peaceful purposes," Brig. Zou al-Kader said.
That is the explanation for the otherwise senseless battle of Najaf. It also explains why Sheik al-Sadr keeps rejecting peace overtures from interim Prime Minister Iyad Allawi to forsake violence and join in the political debate. And finally, if you think the price of oil is high --now skirting $49 a barrel -- wait until it reaches $100, if the U.S and Iran engage militarily.

Claude Salhani is international editor for United Press International.

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>> TERROR

Hamas Suspect Videotapes Bridge in Maryland
NewsMax.com Wires
Tuesday, Aug. 24, 2004
BALTIMORE - A man described as a high-ranking Hamas operative was arrested last week as he videotaped the Chesapeake Bay Bridge, and he was held as a material witness in an unrelated case, authorities said.
Ismael Selim Elbarasse of Annandale, Va., long suspected by authorities of having financial ties to the Palestinian extremist group, was taken into custody Friday, the U.S. attorney's office in Maryland said Monday. He was held as a material witness in a Chicago terrorism case.
Elbarasse made an initial appearance in Baltimore's federal courthouse Monday before U.S. District Magistrate Judge Paul W. Grimm.
A federal grand jury in Chicago, in an indictment unsealed Friday, described Elbarasse as an unindicted co-conspirator in a 15-year racketeering conspiracy in the United States and abroad to illegally finance terrorist activities in Israel.
Court documents allege that he and defendant Mousa Mohammed Abu Marzook, considered one of the highest-ranking Hamas leaders internationally, shared a Virginia bank account that was used to launder hundreds of thousands of dollars for Hamas.
"He is being held only on the material witness charge," said Marcia Murphy, a spokeswoman for the Maryland U.S. attorney's office.
Elbarasse was spotted Friday, the same day the Chicago indictment was made public, by two police officers on the Bay Bridge, authorities said. The officers noticed a man in an SUV who appeared to be of Middle Eastern descent videotaping the bridge, authorities said.
Authorities said the man, who was with a woman and two children, said they had gone to the beach but could not specify what beach they had visited. They also said the camera had recorded close-up images that seemed atypical for a tourist.
Police learned that Elbarasse was wanted as a material witness in connection with the Chicago case, and was on an FBI terrorist watch list, authorities said. But he was not charged with any wrongdoing in connection with the videotaping.
Since Elbarasse's arrest Friday, authorities have searched his house in Virginia, federal officials said. Murphy said she did not know what was found.
Also Monday, a Pakistani man who was spotted a month ago videotaping the skyline of Charlotte, N.C., was indicted on charges of lying to the police and an immigration violation. Kamran Akhtar, 35, of New York City, was charged with six counts in the indictment, but none of them involved terrorism.
? 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.


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Minimizing Mischief in Venezuela, Stabilizing the U.S. Oil Supply
by Stephen Johnson and Ariel Cohen, Ph.D.
Backgrounder #1787

August 12, 2004
Venezuelan President Hugo Ch?vez is systematically leading his country into dictatorship by provoking internal conflict and characterizing his internal opponents as traitors. Beyond Venezuela, he sees himself replacing Fidel Castro as the leader of Latin America's radical left--uniting the region against U.S.-style democracy, free markets, and American influence.
Ch?vez derives popular support from fellow ideologues and a small but committed segment of Venezuela's largely poor population, and he is beginning to use the hemisphere's dependence on Venezuelan oil to encourage leftist movements elsewhere and to pressure other countries into acquiescing to his activities. By politicizing and mismanaging the state petroleum industry, Ch?vez is jeopardizing vital U.S. interests in the Western Hemisphere.
The good news is that the majority of Venezuelans do not support Ch?vez's evolving dictatorship. Opponents have succeeded in petitioning for a referendum to recall him from office on August 15. Democratic governance and free markets are making slow strides in Latin American countries formerly ruled by dictators. While oil resources give him power, countries can buy oil from other vendors.
The bad news is that Ch?vez has consolidated his hold over Venezuela's public institutions and is manipulating the electoral system in his favor. Increasing global demand for petroleum has given him an international power base, and his anti-American political agenda--fueled by petrodollars--could threaten nearby fledgling democracies and flourishing markets.
To strengthen Venezuela's thread-like hold on democracy, cut the potential for regional destabilization, and deter manipulation of energy markets, the United States should help to keep Venezuela in the hemisphere's democratic fold; promote private property rights and the rule of law, including in the natural resources sector; develop alternate sources of petroleum; and engage Latin America more effectively to help allies strengthen democratic institutions and market economies.
Reform, Then Reversal
Venezuelan leaders have never permitted either true representative democracy or really free markets. Until 1958, Venezuela was ruled by generals who first taxed coffee exports and then--after its discovery in 1917--petroleum. They created a welfare state and led citizens to believe that all could benefit from this underground treasure. In 1958, the country rejected military dictatorship in favor of civilian-elected rule. The first president, Romulo Betancourt, tried to institute free-market policies, but an economy and political system run by insiders and ratified by elections proved resistant to change.
During the 1970s, Venezuela nationalized its oil industry and gradually incurred increasing debt through runaway government spending on social programs designed to placate the middle class and the poor. The roller coaster of rising and falling market prices failed to sustain subsidies and programs to provide menial jobs to otherwise unemployed citizens. As a result, the average Venezuelan actually became poorer.
In 1992, a band of army officers led by Lt. Col. Hugo Ch?vez Fr?as attempted to overthrow President Carlos Andr?s P?rez. Although court-martialed and jailed, Ch?vez emerged a hero. In 1998, he was elected president on promises to clean out corruption and reduce poverty. Once in office, Ch?vez promoted a new consitution to consolidate his powers and began to constrain the business community, civil society, and rival politicians.
By 2001, Venezuelans had begun to protest his attempts to nationalize the Venezuelan Workers Union and turn schools into political indoctrination centers with Cuban curricula and teachers. Massive demonstrations followed in 2002. When 150,000 protesters marched on the presidential palace on April 11, Ch?vez reportedly ordered snipers to fire on them. Top generals convinced him to resign and replaced him with a hastily assembled junta headed by protest organizer and Chamber of Commerce and Industry President Pedro Carmona. The Rio Group of 19 Latin American presidents1 denounced the event as a coup, while the United States guardedly urged Venezuelans to restore democratic order.
Accounts of what happened next vary, but the junta attempted to dissolve the National Assembly and dismiss other elected officials. The military withdrew its support for the insurrection and brought Ch?vez back two days after his departure. The president later denied his resignation, and no investigation occurred to reveal what transpired.2 Later, opponents tried to force another resignation by staging a massive national strike (December 2002-January 2003) that spread to the state oil company, causing a temporary shutdown in January 2003. When that failed, more democratically minded detractors prevailed to seek a referendum on his presidency.
From Friend to Foe
Until the Ch?vez presidency, oil-rich Venezuela had been at peace with its neighbors and a firm American ally. Shortly after coming to power in Cuba in 1959, Fidel Castro visited President Betancourt in Caracas and asked him to join an alliance against the United States. Betancourt refused, and an angry Castro began sending insurgents to overthrow Venezuela's democracy in 1961. In the 1970s, President Carlos Andr?s P?rez discouraged further external aggression by improving relations with Cuba, as well as the Soviet Union and China, while remaining a friend to the United States.3
But the situation changed in 1998. As a presidential candidate, Hugo Ch?vez campaigned against the "savage capitalism" of the United States. On August 10, 2000, he became the first foreign leader to visit Saddam Hussein since the Gulf War, and he allegedly aided Afghanistan's Taliban government following the September 11, 2001, attack on the United States.4 At the same time, Ch?vez said that Cuba and Venezuela were "called upon to be a spearhead and summon other nations and governments" to fight free market capitalism.5
He cut back U.S.-Venezuelan military cooperation on counternarcotics by refusing overflights of U.S. aircraft tracking drug smugglers. In May 2004, Defense Minister Jorge Garc?a ordered the U.S. military mission to leave the Fuerte Tiuna offices that it had occupied for the past 50 years.6
Since his brief departure from power in April 2002, Ch?vez has charged the United States with complicity in what he now calls an attempted coup against him. After a June 24, 2004, U.S. Senate hearing on the situation in Venezuela, Ch?vez characterized U.S. Congressmen as "dogs of war, those that intend to dominate the world, those imperialists."7
Within Venezuela's immediate neighborhood, reports suggest that Ch?vez has aided the narcoterrorist Revolutionary Armed Forces of Colombia (FARC). Videos and documents revealed by dissident Venezuelan military officers portray official promises of supplies and refuge as well as the existence of several FARC fronts on the Venezuelan side of the Colombia-Venezuela border.8 In Bolivia, Ch?vez reportedly has close ties to indigenous activists Felipe Quispe and Evo Morales, who helped lead an uprising that forced elected President Gonzalo S?nchez de Lozada from office in October 2003. And in El Salvador, Venezuelan troops sent to help victims rebuild after a devastating earthquake in 2001 were nearly declared persona non grata for allegedly urging villagers to support the leftist Farabundo Mart? National Liberation Front. 9
President Ch?vez's Fifth Republic Movement (MVR) party is allied with the Brazil-based Foro de S?o Paulo--an organization of some 39 leftist parties and guerrilla organizations from 16 countries in the hemisphere. It shares Ch?vez's anti-American agenda, opposing U.S. counternarcotics collaboration with Latin America and the Free Trade Area of the Americas, which it characterizes as an annexation of the region to the United States.10
Opening a rival front, Ch?vez inaugurated the first Peoples Bolivarian Congress on November 25, 2003, in Caracas. It reportedly brought together 400 representatives from 20 Latin American countries expressly to condemn the policies of the United States, U.S. Southern Command, the International Monetary Fund, and the World Bank. 11
Oil Politics and Mismanagement
When the United States became a net oil importer in the 1970s, friendly Venezuela was a founding member of the Organization of Petroleum Exporting Countries (OPEC) and a top supplier to the American market. Even though it nationalized its oil industry in 1975, creating the state oil company Petr?leos de Venezuela, S.A. (PDVSA), reform-minded politicians proposed giving back shares to every Venezuelan family while exploration and production was reopened to foreign participation in 1996.
Ch?vez put further reforms on hold and set a precedent by expropriating foreign assets. His 1999 constitution prohibited future PDVSA privatization, while his 2001 Hydrocarbon Law doubled royalties on foreign operators from 16.67 percent to 30 percent and required a majority government stake in future joint ventures.12 During the December 2002 national strike, the Venezuelan military seized an information technology company jointly owned by PDVSA and the U.S.-based Science Applications International Corporation (SAIC).13 Such expropriations could jeopardize the investments of international major oil companies--such as Mobil, ChevronTexaco, and ConocoPhillips--in oilfield development projects like those in Venezuela's Orinoco basin. According to its 2004-2009 development plan, PDVSA projects $37 billion in new investment, including $10 billion from international companies.14
For the moment, PDVSA is dependent on U.S. refineries, which partially supply its CITGO gas station chain. PDVSA owns refining facilities located in Louisiana, Illinois, Texas, New Jersey, and Georgia as well as several installations in Europe.15 Irresponsible tampering with U.S. and international company activities by the Ch?vez government could prompt legal proceedings against Venezuelan holdings in the West.
Using Oil as a Political Tool
Ch?vez uses oil as a political tool to advance his hemispheric and global ambitions. He played a key role in the 1999 and 2003 OPEC decisions to cut production and coordinate policy aimed at driving oil prices higher. In 2000, Ch?vez visited Iran, Iraq, Libya, and Saudi Arabia, further agitating for production cuts and quota enforcement. The same year, he promised Fidel Castro 53,000 barrels of oil a day on concessionary terms in exchange for the services of Cuban doctors, teachers, and intelligence experts.
Besides supplying the United States with 1.5 million barrels of oil a day (mbd), Venezuela provides most of the petroleum consumed by U.S. allies in the Caribbean and Central America. Their leaders know that opposing Ch?vez in any significant fashion could result in less favorable sales terms or cuts in deliveries. In September 2003, President Ch?vez accused the Dominican Republic of harboring Venezuelans--like former President Carlos Andr?s P?rez--who allegedly might conspire against his government. He then stopped oil deliveries, prompting a temporary energy crisis while Dominican officials scrambled for new suppliers.
Beyond the hemisphere, Ch?vez is preparing to shift PDVSA's customer base toward Asia and an increasingly oil-thirsty China, making Venezuela less dependent on petroleum sales to immediate neighbors. A deal signed on July 14, 2004, to build oil and gas pipelines between the Maracaibo Basin in Venezuela and the Caribbean and Pacific coasts in Colombia may seem innocuous, but it would enable Venezuela to ship petroleum to China without using the Panama Canal. This would make it more critical than ever for Ch?vez to secure a pliant government in Colombia to keep this facility operating in Venezuela's interest.16 Ch?vez would thus have the luxury of cutting deliveries to those who opposed him, forcing them to seek other sources at greater cost. By destabilizing and replacing democratic governments in hydrocarbon-rich Bolivia, Colombia, and Ecuador, he also could achieve a regional energy monopoly that could support rogue regimes and frustrate U.S. interests in the hemisphere.
Mismanagement Threatens the Future
During its 20-year history before Ch?vez, PDVSA built a reputation for smooth operation and competence, but the 2002-2003 national strike devastated the oil giant. Some 35,000-40,000 skilled workers, including fire fighters, walked out while spillage and fires ensued. Production capacity dropped from three mbd to 600,000 barrels. Ch?vez fired 18,000 skilled managers and workers, further undermining PDVSA's precarious situation.17 To regain and maintain pumping capacity at an estimated 2.5 mbd, PDVSA engineers reportedly "goose" wells by pumping air and water into them to coax Venezuela's viscous petroleum to the surface, endangering the long-term viability of existing fields.
Despite recent high oil prices that have provided a fresh infusion of cash, PDVSA remains in disarray. Venezuelan economist Gustavo Garc?a calculates that this year's internal investment fell from $5 billion to $4.3 billion while salaries went up 60 percent despite no apparent increase in productivity or number of employees.18 Without reinvestment in equipment and maintenance, PDVSA will not be able to maintain current production levels. Moreover, Ch?vez has reportedly channeled between $1.6 billion and $3.7 billion from PDVSA into a special account that he is using to finance social programs to influence voters in the upcoming referendum on his presidency.19
Recall and Prospects
President Ch?vez's Bolivarian Constitution contemplates a referendum process for recalling public officials. Fortunately, opponents of various political stripes--including some former Ch?vez allies--have agreed to settle differences with the president at the ballot box. The bad news is that Ch?vez has tried to intimidate and divide opponents or otherwise block a vote.
Two months after President Ch?vez's brief departure from office in 2002, the government invited former U.S. President Jimmy Carter and later the Organization of American States (OAS) to broker talks between the administration and the opposition, leading to a binding referendum as an alternative to civil conflict. Shortly thereafter, the National Electoral Council (CNE) was packed with Ch?vez allies who blocked several efforts for a recall.
Finally, the CNE allowed an official period for gathering signatures--known as the firmazo--in late 2003. Once organizers collected names on government forms, it changed the rules on how the forms should have been filled out and then dragged out a review process to "repair" or rehabilitate some of the disqualified signatures.
In May 2004, under pressure from the OAS and the Carter Center, Ch?vez grudgingly allowed a re-examination, known as the reafirmazo, of nearly a million signatures thrown out by the partisan CNE. It turned out that petition organizers had 2.56 million names--130,000 more than were needed to trigger a recall. As a result, the CNE scheduled a referendum for August 15, 2004.
For its part, Venezuela's opposition umbrella group--the Democratic Coordinator--has united to support a 10-point platform to create jobs, attract investment, fight poverty, strengthen local government, institute checks and balances, rebuild public institutions, and open the government to citizen participation. Moreover, if Ch?vez loses the referendum, opponents promise to hold a primary to select their candidate. Ch?vez has declared that he will run again for his Fifth Republic Movement party even though the constitution is unclear on whether he can do so.
Despite the opposition's willingness to play by the rules, many signs point to possible fraud by the government, even though some polls show the president with a 50-50 chance of winning the referendum. Specifically:
The CNE will use new touch-screen voting machines from a company of which it is part owner. Technical glitches and power outages could disenfranchise thousands, thus producing fewer votes than needed to recall the president.20 Rigged software could alter vote totals. Similar touch-screen systems without paper trails are under fire in the United States.21
Government teams in military trucks have circulated in pro-Ch?vez neighborhoods, credentialing new voters. No such efforts have been made in opposition barrios. The regime also has been naturalizing foreign residents at a frantic pace--some 236,000 from May through June in a program called "Misi?n Identidad."22
Ch?vez continues to intimidate opponents. On numerous occasions, he has accused them of trying to assassinate him. National police claim they found fake ID cards, computers, and printers in raids on offices of an opposition party in June 2004, but witnesses say they saw agents carry in suspicious bundles. The government even charged the directors of Sumate, a non-governmental organization (NGO) that helped organize the referendum, with conspiracy to commit treason for accepting a $53,000 grant for electoral observation from the U.S.-funded National Endowment for Democracy even though the Ch?vez administration has accepted thousands of doctors, teachers, and intelligence agents from Cuban dictator Fidel Castro.
Ch?vez has earmarked from $1.6 billion to $3.7 billion worth of state oil income to spend on poor voters during the campaign. He commands radio and TV stations to broadcast his speeches without equal time for opponents. In June, he revealed plans to enlist millions of "patriotic" electoral patrols to surveil neighborhoods under the authority of a campaign committee of high government officials known as the Comando Maisanta.
Curbing Mischief
Hugo Ch?vez is no democrat. At home, he has concentrated the powers of the state in his presidency, expropriating budgets from municipal governments, strengthening the national police, and packing the Supreme Court with cronies.23 Abroad, he appears to be in the initial stages of creating a confederation of nations opposed to the United States that is sustained by oil and united by an improvised nationalist ideology. History suggests a future of conflict and poverty, both for those under his rule and for all those who are allied with him.
Other countries in Latin America share some of Venezuela's economic characteristics--abundant resources and high rates of poverty that make them easy prey for populist demagogues. A bloc of states united in leftist authoritarianism and oil extortion could ignite the flames of armed confrontation again in the Western Hemisphere. To avoid needless conflict as well as a possible energy crisis, the United States should help direct Venezuela back toward democracy, develop alternate sources of petroleum, and engage Latin America more effectively to help allies strengthen democratic institutions and market economies.
Specifically, the United States must:
Encourage a free and fair electoral process in Venezuela's August 15 referendum. The Organization of American States, the Carter Center, and observers from other countries and international organizations sympathetic to Ch?vez have been invited to witness the vote. It is in America's interest to support the OAS observer mission and to urge all impartial monitors to uphold electoral standards that protect Venezuela's citizens from partisan intimidation, ensure equal party representation at the polls, guarantee fair opportunity to vote, permit equal access to broadcast and print media by all sides, allow observers freedom to monitor and report on all aspects of the vote, and ensure an independent audit and paper trail for any voting machines used.
The United States should urge allies to condemn fraud by any party, but if fraud is committed by the government and the outcome is altered as a result, OAS members should be ready to invoke the OAS Democratic Charter to pursue a rectification or suspension of Venezuela's membership. The World Bank should be poised to suspend loans to Venezuela as well. However, if a fair vote results, all parties and observers should respect the outcome.
Constrain mischief if Ch?vez remains in office. Whether or not he wins the referendum, wins a follow-on election, or manipulates the process to remain in office, the United States, the OAS, and democratic neighbors must not relent in applying pressure on Venezuela to abide by norms contained in the Democratic Charter. U.S. Members of Congress should increase visits with counterparts in the National Assembly to advocate legislative oversight to curb executive branch excesses. The U.S. National Endowment for Democracy should continue funding election observers and local NGOs committed to strengthening democratic institutions. The United States and democratic allies should insist that Ch?vez dismantle and disband armed partisan groups such as the Bolivarian Circles, which clearly violate democratic principles. The same community should resist any attempt by Ch?vez to subvert democracy in neighboring countries.
Encourage timely political and economic reforms . If Ch?vez's opponents win the referendum and subsequent presidential elections, the United States should support the OAS in continuing to monitor human rights and civil liberties to prevent reprisals by violent loyalists. Washington and allies such as the Group of Friends (Brazil, Chile, Mexico, Portugal, and Spain)24 should be willing to support reforms to roll back Chavez's police state and jump start a new market economy. The task will be daunting: to reverse decrees allowing expropriation of private property, repeal unduly restrictive business laws, restore local authority over municipal budgets and services, retire partisan generals, strengthen separation of powers, and rewrite Venezuela's convoluted socialist constitution.
Through diplomacy, the United States should encourage Venezuelans to safeguard PDVSA from presidential pilfering and put it in the hands of Venezuelan citizens through stock offerings. The creation of a transparent national oil fund fed by royalties would provide a social cushion without state mismanagement of the industry. A majority stake ownership by the private sector would be more likely to attract the capital needed to meet PDVSA's 2009 production target of 5 mbd and develop super-heavy oil fields and offshore natural gas fields.
Develop alternate sources of petroleum and gas to avoid energy extortion. Besides increasing domestic exploration, America should be prepared to shift oil purchases to Brazil, Canada, Ecuador, and Mexico to compensate for potential cuts in Venezuelan production. Moreover, the U.S. Department of Energy (DOE) should help dependent Latin American and Caribbean nations diversify their energy sources.
Promote property rights. The DOE should also encourage consultations between energy coporations, Latin American governments, and NGOs with expertise in property rights, such as Peru's Institute for Liberty and Democracy, to establish, guarantee, and enforce private and corporate property rights, including rights to subsurface minerals and hydrocarbons. Enhancing such rights could even help the rural poor, some of whom may own land with petroleum deposits, and could also diminish exploitation of energy industries by self-serving politicians.
Increase support for democratic institutions and market economies throughout Latin America. The United States must increase support for the countries neighboring Venezuela, many of which--like Bolivia and Ecuador--have fragile democracies and weak economies. It must strive to improve peoples' representation in political parties, enhance separation of powers, and promote equal treatment of all citizens before the law in order to increase confidence in democratic institutions as opposed to demagogues. Congress should ratify recently concluded trade pacts with Central and South American countries, and the White House should support regional economic reforms to enable entrepreneurs to start new businesses and the poor to accumulate wealth. Better integrated societies with accountable governments and abundant economic opportunities are more able to resist the spell of charismatic dictators.
Conclusion
On August 15, 2004, Venezuela's citizens will go to the polls to decide whether to retain or recall President Hugo Ch?vez. During the five years he has been in office, he has divided the nation through demagoguery, destroyed an already anemic private sector through bad economic policy and conflict, caused 12 percent of the population to slip into extreme poverty,25 and created a climate of fear by dispatching partisan political gangs advised by Cuban intelligence officers. Logic would suggest that he be recalled, but fraud or fear that personal security depends on loyalty to Ch?vez could well keep him in office.
In view of its political and economic instability, as well as its evolving anti-American policies, Venezuela should no longer be considered a reliable supplier of oil. Moreover, mismanagement, diversion of funds, and shifting alliances to match the political goals of President Ch?vez could keep PDVSA from raising enough capital to stay competitive and maintain production levels. Both the United States and neighbors that depend on Venezuela's oil should diversify their sources of energy imports. They should also guard against any efforts by Ch?vez to use oil revenues to support revolution beyond his country's borders.
Above all, the United States must not abandon Venezuelans who seek a democratic and free-market renewal. All their leaders, including Ch?vez, should be actively discouraged from populist rule and guided toward institutions of public service by a combination of policy incentives and sanctions. To a lesser degree, similar problems exist elsewhere in Latin America. There too, the United States should redouble efforts to ensure that pluralism and free choice defeat authoritarianism and misery.
Stephen Johnson is Senior Policy Analyst for Latin America and Ariel Cohen, Ph.D., is Research Fellow in International Energy Security and Russian and Eurasian Studies in The Kathryn and Shelby Cullom Davis Center for International Studies at The Heritage Foundation. The authors wish to thank Intern Santiago Pinz?n for his assistance with this research.
---
1. An informal consultative body formed in 1986.
2. The junta made uncharacteristically rapid and peculiar decisions, suggesting it was under pressure from the officers. The military also summoned Venezuelan civic leaders to the palace to sign a pledge supporting the junta. This may have been a ruse to draw out Ch?vez's adversaries in order to discredit them. One of the participants in the insurrection, General Lucas Rinc?n, escaped punishment and is now the Minister of Interior and Justice. In a similar strange incident in May 2004, Ch?vez claimed that on a farm outside Caracas, his police had captured Colombian paramilitaries who were plotting to assassinate him. Eventually, 102 were charged and shown to reporters in Venezuelan army fatigues. A National Assembly deputy called it a publicity stunt to distract attention from the referendum drive to recall Ch?vez from office. See James Menendez, "Chavez Foils `Assassination Plot,'" BBC News, May 9, 2004, at news.bbc.co.uk/1/hi/world/americas/3699245.stm (August 2, 2004). See also Carlos Chirinos, "Venezuela: `Bluff Paramilitar,'" BBC Mundo News, June 29, 2004, at news.bbc.co.uk/hi/spanish/latin_america/newsid_3852000/3852047.stm (June 30, 2004).
3. Cuban insurgents initially tried to recruit Venezuelan collaborators, but pro-Soviet Venezuelan communists resented the Cuban intrusion, while other supporters left to develop a concept that embraced indigenous pride and sought an alliance between radicals and soldiers eager to re-establish military rule. It was called la Revoluci?n Bolivariana after Sim?n Bol?var, a hero of South American independence. As a junior officer, Hugo Ch?vez was undoubtedly influenced by this ideology. See Alberto Garrido, "El Eje Revolucionario Ch?vez-Castro," El Universal, June 22, 2004.
4. According to former Ch?vez personal pilot Major Juan D?az. See Casto Ocando, "Organismo demanda a Ch?vez en Miami," El Nuevo Herald, January 30, 2003, at www.miami.com/mld/elnuevo/news/world/americas/5060974.htm (January 31, 2003).
5. "Chavez Says Ties Make Venezuela, Cuba `One Team,'" Reuters, September 6, 2001.
6. "Venezuela Asks U.S. Military to Leave Base Offices," Reuters, May 12, 2004.
7. "Ch?vez califica de `perros de la guerra' a congresistas de EE.UU.," Associated Press, June 27, 2004.
8. "Colombia evaluar? supuestos nexos entre Farc y militares venezolanos," El Tiempo, January 31, 2002, at www.terra.com.co/actualidad/internacional/31-01-2002/nota47739.html (March 27, 2002), and Javier Ignacio Mayorca, "740 de las FARC en Venezuela," Venezuela Anal?tica, March 11, 2002, at www.analitica.com/va/vpi5521076.asp (April 1, 2002).
9. Giaconda Soto, "El Salvador se retracta y permite permanencia de militares venezolanos," El Nacional, May 3, 2001, at www.el-nacional.com/eln03052001/pa2s1.htm (May 3, 2001).
10. "Resolu??o a favor da revolu?ao bolivariana da Venezuela," Foro de S?o Paulo, 10th Encounter, Havana, Cuba, December 7, 2001, at pt.uol.com.br/site/teste/textos/10venezuelap.asp (March 27, 2002).
11. "Primer Congreso Bolivariano de los Pueblos," Final Declaration, Web site Rebeli?n-Resistencia Global, November 30, 2003, at www.rebelion.org/sociales/031130congreso.htm (June 30, 2004).
12. Energy Information Agency, An Energy Overview of Venezuela, Privatization Status, p. 2, at www.fe.doe.gov/international/venzover.html (July 27, 2004).
13. Established in 1996, Inform?tica, Negocios y Tecnolog?a, S.A. (Intesa) provided computer services to the state oil giant, SAIC exercising a 60 percent share. In May 2002, the Venezuelan government notified SAIC that it wanted to terminate the partnership and made a buyout offer. Before the parties could come to an agreement, PDVSA president Ali Rodr?guez ordered a lockout and the army seized Intesa's assets. The U.S. Overseas Private Investment Corporation granted SAIC $6 million in compensation, while its spokesman declared it would not support future investments in Venezuela. See Bruce V. Bigelow, "SAIC to Recoup Some Losses in Venezuela Deal," The San Diego Union-Tribune, July 20, 2004, at www.signonsandiego.com/uniontrib/20040720/news_1b20saic.html (July 30, 2004).
14. "Venezuela Says OPIC Ruling Won't Hurt Investment," Reuters, July 21, 2004.
15. Ibid.
16. Ch?vez might then shift tactics from aiding Colombia's FARC guerrillas to backing revolutionaries in Colombian elections.
17. Frances Robles, "Oil Accidents Mount in Venezuela," Miami Herald.com, January 21, 2002 (July 27, 2004).
18. Victor Salmeron, "PDVSA aument? partida de salarios en 60%," El Universal, July 30, 2004, at http://www.eluniversal.com/2004/07/30/eco_art_30158C.shtml (July 30, 2004).
19. Matthew Robinson, "PDVSA Spending May Hit Venezuela Oil--Analysts," Reuters, July 12, 2004 (July 27, 2004). Lower estimate is from Economist Intelligence Unit, 2004 Country Report.
20. Some 3.8 million are required to exceed the number that re-elected Ch?vez president in the 2000 contest following the adoption of his new constitution.
21. See Jon E. Dougherty, "`Reformers' Now Attack Costly Election `Reform' of E-Voting," NewsMax.com, July 30, 2004, at www.newsmax.com/archives/articles/2004/7/29/115913.shtml (August 2, 2004).
22. "Nacionalizados 236 mil extranjeros en dos meses," El Nuevo Siglo, July 6, 2004, at www.elnuevosiglo.com.co/noticia.php (July 6, 2004).
23. On May 18, a slim majority of pro-Ch?vez deputies in the National Assembly passed a law expanding the Supreme Justice Tribunal from 20 to 32 justices and made it possible to approve and remove appointees by a simple majority vote. See "Venezuela: Judicial Independence Under Siege," Human Rights Watch, June 17, 2004, at www.hrw.org/english/docs/2004/06/17/venezu8855.htm.
24. Organized by Brazil and the United States in January 2003 to hold President Ch?vez accountable for promises to abide by electoral procedures outlined in his own constitution.
25. Jackson Diehl, "A Missile from the South," The Washington Post, August 2, 2004, p. A17.
? 1995 - 2004 The Heritage Foundation
All Rights Reserved.


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Bush Health Care Plan Seems to Fall Short
Gap Grows Between Hard Data, Projections for Covering 10 Million Uninsured
By Ceci Connolly
Washington Post Staff Writer
Sunday, August 22, 2004; Page A04
If the Republican-controlled Congress enacted President Bush's entire health care agenda, as many as 10 million people who lack health insurance would be covered at a cost of $102 billion over the next decade, according to his campaign aides.
But when the Bush-Cheney team was asked to provide documentation, the hard data fell far short of the claims, a gap supported by several independent analyses.
Projections by the Congressional Budget Office, the Treasury Department, academics and the campaign's Web site suggest that under the best circumstances, Bush's plans for health care would extend coverage to no more than 6 million people over the next decade and possibly as few as 2 million.
"There's little reason to expect that there would be any reduction in the overall numbers of Americans without health insurance," Brookings Institution health policy expert Henry J. Aaron said. "We're swimming against a rather swift current in our efforts to reduce the number of uninsured, and the power of President Bush's proposals to move against that current is, it seems to me, very, very limited."
In his bid for a second term, Bush is reprising much of the health care agenda he ran on in 2000, including tax credits for individuals who purchase insurance, and the formation of new, largely unregulated purchasing pools for small businesses called association health plans.
His Democratic challenger, Sen. John F. Kerry (Mass.), has released a health care agenda that is more ambitious and more expensive, with plans to expand government health programs, offer tax credits similar to Bush's and reimburse businesses for some of their most costly catastrophic cases.
Forecasting the cost and impact of policy proposals is always complicated, and both presidential campaigns try to spin the numbers to their advantage. Kerry, for example, estimates his health care proposals would cover 27 million people at a 10-year cost of $653 billion. But that assumes $300 billion in "savings" that the Bush team says might prove elusive. Without the savings, the cost of the Kerry package jumps to nearly $1 trillion.
Health experts inside and out of the administration say many of the assertions Bush makes about his first-term health care record and his health proposals for a second term are exaggerated, incomplete or contrary to widely accepted analyses.
On the campaign trail, the president trumpets last year's enactment of a Medicare prescription drug package as his signature health achievement. In monetary terms, the new policy -- estimated to cost $564 billion over 10 years -- goes far beyond the $158 billion proposal candidate Bush ran on in 2000.
"When we came to office, too many older Americans could not afford prescription drugs. Medicare didn't pay for them," he said last month. "Leaders in both political parties had promised prescription drug coverage for years. We got it done. More than 4 million seniors have signed up for drug discount cards that provide real savings."
Left unsaid is that 2.9 million of them had no choice; they were enrolled automatically. And full implementation of the drug benefits will not occur until 2006.
Since Bush took office, the number of Americans without health insurance has climbed by 4 million, to nearly 44 million. On its Web site and at news briefings, the Bush campaign says that through its actions overseeing Medicaid and the Children's Health Insurance Program, the administration has "expanded eligibility to more than 2.6 million people."
The statement gives the impression "they have extended coverage to 2.6 million more, and that is not really true," said Diane Rowland, executive director of the Kaiser Commission on Medicaid and the Uninsured. "In reality, only 200,000 of them got coverage" because of Bush administration efforts.
Megan Hauck, deputy policy director for health care of the Bush campaign, did not have figures but said she thought the Kaiser data were "awfully low."
Total enrollment in the two government health programs did rise during Bush's tenure -- by about 7.5 million. But for the vast majority, coverage was required by law, not the result of any policy change.
"Part of the reason more people were covered is the economy got so bad that people lost income," Rowland said. "There were more low-income people under Bush than previously, so they became eligible for public programs."
Although Hauck generally touts the campaign's projection that the Bush proposals would expand coverage to 10 million Americans, she said it could be as few as 6 million. Of the 10 million, half will use the proposed $1,000 tax credit ($3,000 for families) to buy insurance. The estimate comes from congressional testimony by a Treasury Department official who speculated that the 10-year, $70 billion proposal could result in coverage for 4 million to 5 million people.
One year earlier, the Bush budget set aside $89 billion for the same credit, claiming it would cover 4 million. Analysts say it is impossible to see how spending $20 billion less, at a time when premiums are much higher, could achieve the same level of coverage.
If the tax credit were passed, Jonathan Gruber, an economist at the Massachusetts Institute of Technology, predicts some businesses will drop health insurance. If just 1 percent of people who currently receive coverage from an employer bought individual insurance instead, the Bush policy would result in 1.8 million newly insured, according to Gruber's analysis.
The next-largest element in the Bush agenda is a proposal to allow small businesses to band together to purchase insurance through new association health plans. Hauck said 2 million people would be covered if this were enacted. The figure came from a January 2000 CBO report in which the nonpartisan agency said 10,000 to 2 million people might join association health plans.
But in its July 2003 analysis of the Republican bill, the CBO concluded that 600,000 Americans would likely buy into the pools, at a cost of $254 million. Even the Bush campaign Web site reports that "600,000 would be newly insured," or 1.4 million fewer than Hauck's tally. And a recent study by Mercer Risk, Finance and Insurance Consulting found the proposal could result in a decline of 1 million insured, because small-business insurance premiums would likely rise.
Finally, the Bush campaign projects that 3 million people would be covered through new health savings accounts, which allow people to save money tax-free for out-of-pocket medical expenses. The new accounts, purchased in combination with high-deductible, catastrophic insurance, were created as part of last year's Medicare prescription drug package.
Hauck said an "internal estimate" by the campaign indicates the provision would extend insurance to 1.1 million people, though she could not provide supporting material. The Joint Committee on Taxation estimated the proposal would cost $6.7 billion, but officials there declined to say how many people that figure was based on.
MIT's Gruber and Paul Ginsburg, president of the Center for Studying Health System Change, said the impact would be minimal, because some people likely to purchase the new accounts are currently insured. Democrats say it is unfair for the Bush campaign to include the provision at all, since it is current law, not a proposal.
Bush wants to expand use of health savings accounts by also making the premiums tax-deductible, a proposal Gruber said would increase the number of uninsured by 350,000.
But Hauck said the campaign assumes that making the premiums deductible will result in coverage for an additional 1.9 million people. That figure is based on an article by Dan Perrin and Richard Nadler at the HSA Coalition, a group that has worked for the past decade to pass medical savings account legislation, according to its Web site.
The coalition includes conservative members such as the Christian Coalition, the 60 Plus Association and the Small Business Survival Committee.
? 2004 The Washington Post Company
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Diary refutes Kerry claim
By Stephen Dinan and Charles Hurt
THE WASHINGTON TIMES
John Kerry's own wartime journal is raising questions about whether he deserved the first of three Purple Hearts, which permitted him to go home after 4? months of combat.
The re-examination of Mr. Kerry's military record, prompted by commercials paid for by Swift Boat Veterans for Truth and the book "Unfit for Command: Swift Boat Veterans Speak Out Against John Kerry" by two of the group's members, continued even as Mr. Kerry stated that voters should judge his character based on his anti-war activities upon returning from Vietnam.
A primary claim against Mr. Kerry by the Swift Boat Veterans is that Mr. Kerry's first Purple Heart -- awarded for action on Dec. 2, 1968 -- did not involve the enemy and that Mr. Kerry's wounds that day were unintentionally self-inflicted.
They charge that in the confusion involving unarmed, fleeing Viet Cong, Mr. Kerry fired a grenade, which detonated nearby and splattered his arm with hot metal.
Mr. Kerry has claimed that he faced his "first intense combat" that day, returned fire, and received his "first combat related injury."
A journal entry Mr. Kerry wrote Dec. 11, however, raises questions about what really happened nine days earlier.
"A cocky feeling of invincibility accompanied us up the Long Tau shipping channel because we hadn't been shot at yet, and Americans at war who haven't been shot at are allowed to be cocky," wrote Mr. Kerry, according the book "Tour of Duty" by friendly biographer Douglas Brinkley.
If enemy fire was not involved in that or any other incident, according to the Military Order of the Purple Heart, no medal should be awarded.
"The Purple Heart is awarded to members of the armed forces of the U.S. who are wounded by an instrument of war in the hands of the enemy," according to the organization chartered by Congress. According to regulations set by the Department of Defense, an enemy must be involved to warrant a Purple Heart.
Altogether, Mr. Kerry earned three Purple Hearts, a Bronze Star and a Silver Star.
A Kerry campaign official, speaking on background, told The Washington Times yesterday that the "we" in the passage from Mr. Kerry's journal refers to "the crew on Kerry's first swift boat, operating as a crew" rather than Mr. Kerry himself.
"John Kerry didn't yet have his own boat or crew on December 2," according to the aide. "Other members of the crew had been in Vietnam for some time and had been shot at and Kerry knew that at the time. However, the crew had not yet been fired on while they served together on PCF 44 under Lieutenant Kerry."
Mr. Kerry's campaign could not say definitively whether he did receive enemy fire that day.
The newly exhumed passages were first reported by Fox News Channel in a televised interview with John Hurley, national leader of Veterans for Kerry.
"Is it possible that Kerry's first Purple Heart was the result of an unintentionally self-inflicted wound?" asked reporter Major Garrett.
"Anything is possible," Mr. Hurley replied.
The Swift Boat Veterans say that means Mr. Kerry is now backing off of his first Purple Heart claim, just as he has apparently changed his claim that he spent Christmas 1968 on an operation in Cambodia.
"It's a house of cards," said Van Odell, one of the veterans. "What he wrote in 'Tour of Duty' and how he used that is nothing but a house of cards, and it's exposed."
At a fund-raiser last night in Philadelphia, Mr. Kerry defended his anti-war activism upon his return from Vietnam, which also has come under attack by the Swift Boat Veterans, as "an act of conscience."
"You can judge my character, incidentally, by that," he said.
"Because when the time for moral crisis existed in this country, I wasn't taking care of myself, I was taking care of public policy," Mr. Kerry told his audience. "I was taking care of things that made a difference to the life of this nation. You may not have agreed with me, but I stood up and was counted, and that's the kind of president I'm going to be."
The Swift Boat Veterans' claims and the political storm that surrounds them has dominated the presidential campaign for the last two weeks.
The Center for Media and Public Affairs said that from Aug. 9 to 15, the first week after the group's ads were released, there were 92 mentions in major papers and 221 mentions in all news reports. By last week, Aug. 16 to 22, there were 221 mentions in major papers and 696 mentions in all news reports the center tracks.
"The Swift Boat veterans commercial is the 'Blair Witch Project' of campaign ads -- an enormous return on a small investment," said Matthew T. Felling, media director for the center. "Everyone is talking about it, and no one can agree on where the line between fact and fiction exists."
He said the commercial has become "a national player in its own right," nearly equaling Vice President Dick Cheney's 733 mentions in all news reports last week.
Mr. Kerry himself is making personal phone calls trying to stamp out the controversy.
On Monday morning, a day after former Sen. Bob Dole questioned Mr. Kerry's Purple Hearts on CNN, Mr. Kerry called the former Republican presidential candidate.
"There's respect there. We were in the Senate together," Mr. Dole told interviewer Wolf Blitzer on Monday. "But we're talking about the presidential race, and I tweaked him a little on the Purple Hearts."
And on Sunday, Mr. Kerry called Robert Brant, one of the members of Swift Boat Veterans for Truth.
A source associated with the veterans group and familiar with the 10-minute conversation said Mr. Kerry asked whether Mr. Brant knew about the group. When Mr. Brant said he was part of it, there was "kind of a silence" on the line before Mr. Kerry continued the conversation.
The source said Swift Boat Veterans is considering sending a cease-and-desist letter to Mr. Kerry asking him not to contact their members anymore because it might be a violation of campaign-finance laws.
In a speech at the Cooper Union school in New York yesterday, Mr. Kerry said the "Bush campaign and its allies have turned to the tactics of fear and smear."
Asked by reporters about the Swift Boat furor later yesterday, Mr. Kerry said he's trying to focus on "the economy, jobs, health care -- the things that matter to Americans."
Asked specifically if he has been calling Swift Boat veterans, Mr. Kerry said, "I am talking about the things that are important to Americans -- jobs, health care, how we are going to fix our schools."
In last night's Philadelphia speech, even while defending his activities with Vietnam Veterans Against the War, Mr. Kerry called the criticism of his service "so petty it's almost pathetic in a way."
But the issue is not likely to go away, in part because Mr. Kerry's defenders want their full say.
A new documentary, "Brothers in Arms," will be released in a theater in New York and on DVD everywhere on Friday that highlights Mr. Kerry and the veterans who served with him, and filmmaker Paul Alexander said he found the veterans' stories very convincing.
"What's remarkable to me is when you see the interviews in the movie, how consistent they are on what happened," said Mr. Alexander, who said he interviewed all the men who served on PCF 94, and interviewed them several times over several months. Mr. Alexander previously wrote "Man of the People: The Life of John McCain."
He said the movie particularly sheds light on the incident for which Mr. Kerry earned his Bronze Star, for rescuing a Special Forces officer from the water under what he and his crew said was enemy fire.
The Swift Boat Veterans, including Mr. Odell, say there was no enemy fire, but Mr. Alexander said after making the movie and talking with crewmates Mike Medeiros, Del Sandusky and David Alston, he believes there was enemy fire.
"Mike described the mortar rounds that were going over the top of the 94, and David and Del described the sound effects -- specifically down to what kind of machine gun it was -- the AK-47," Mr. Alexander said. "Their description is so specific they're not mistaken."
*This article is based in part on wire-service reports.





Escape From Kerryland
Fed up with Vietnamania? Relief is at hand.
BY CLAUDIA ROSETT
Wednesday, August 25, 2004 12:01 a.m. EDT
Time for a deep breath. We've hit that late-summer stretch when everyone is waiting for autumn, and the news seems stuck in endless replay. Seven years ago, we were about to hit round-the-clock eulogies to Princess Di. Three years ago, it was Gary Condit, 24/7 (the former congressman, since cleared of suspicion in the death of his young lover, in case anyone has trouble remembering what topped the U.S. talk shows in the weeks just before Sept. 11).
This year, we have John Kerry's Vietnam record. It matters more than Gary or Di, but how long do we have to keep fighting the last war? Having listened earlier this month to breaking news on where Mr. Kerry did or didn't spend Christmas 1968, I escaped last week to a conference in Utah, including a most otherworldly stroll in the Wasatch mountains--and, upon returning, tuned back in to find the country, or at least its most vocal inhabitants, still arguing over Mr. Kerry's Vietnam record.
This can't last. Even beyond the presidential election, this autumn is freighted with more than the usual portents. Soon, for better or worse, events will again compel us forward into the war of today, tomorrow, and years to come. Somewhere--remember Madrid--the next attack is quite likely in the making. Between such matters as Iran's nuclear-bomb-and-terror program, North Korea's nuclear blackmail, and the leads packed into such material as the 9/11 reports--including last week's 152-page monograph on global terrorist funding--it must surely be clear by now that we face not simply Osama bin Laden, or Al Qaeda, but a fascist movement that finds in murder an intoxicating power over the rest of mankind, and in modern technology a terrible arsenal.
Though the form, anchored in Islamofascism, may be specific to our age, the animating spirit runs deep enough for Joseph Conrad in his 1907 novel, "The Secret Agent," to have captured it perfectly in one of his characters, the bomb-making Professor: "He was a force. His thoughts caressed the images of ruin and destruction. He walked frail, insignificant, shabby, miserable--and terrible in the simplicity of his idea calling madness and despair to the regeneration of the world."
Not that the Professor alone can cause much ruin, but when a state-sponsored secret agent hooks up with him, a bomb goes off. An innocent dies. This ghastly offshoot of human nature, hitched in one way or another to assorted despots, is what now threatens our civilization. This war will require even more resolve than we have found so far, and it will not be won by seeking the approval of the tyrant-larded United Nations. It will be won by killing the Professor and laying down the law for his pals--and that can only be done by keeping faith with who we are. And while our arguments of the day certainly matter, some deeply, I am not sure that the spiritual strength for the coming season should be drawn chiefly from the froth of most nightly news.
So, as we approach Sept. 11, 2004, marking the start of year four of World War IV, here are some alternatives to watching the next talk show:
* It sounds like a school assignment, but as you get older, it is more clearly the stuff of life and death: Reread the Declaration of Independence and the Constitution, especially the references to the rights forfeited by tyrants, and the blessings of liberty.
* Take the time you might have spent listening to yet more debate over Mr. Kerry's Vietnam record, and Mr. Bush's response, and write two letters, one to President Bush and one to Mr. Kerry.
Suggestion for Mr. Bush: If he wants to one-up Mr. Kerry on Vietnam, try nudging the debate forward, from 1968 into the 21st century. In the interest of the liberty and democracy that Mr. Bush has put forward as pillars of U.S. foreign policy, this would be a good moment for him to speak up for a democratic dissident who is in prison in Vietnam today, still fighting for that country's freedom, Nguyen Dan Que.
Suggestion for Mr. Kerry: One of his constituents, Mohamed Eljahmi, has a brother, a citizen of Libya, and democratic dissident there. Fathi Eljahmi was released from a Libyan prison earlier this year, in the first flush of new-found U.S.-Gadhafi rapprochement, only to be detained again by Gadhafi within the month. Since late March, Fathi Eljahmi has been held incommunicado by Gadhafi's secret police. And while Gadhafi's surrender of his nuclear kit may have earned his regime the privilege of not being attacked outright by the U.S., he has done nothing to deserve the kind of U.S. approval he has since received. If Mr. Kerry wants to one-up Mr. Bush, he would do well to point out that under Mr. Bush's own doctrine, it is not the tyrant, Gadhafi, but the democratic dissident, Fathi Eljahmi, who deserves the support of America and our allies.
* Dust off that old college Shakespeare, and open it to Henry V, Act IV, Scene 3, in which the king, on the eve of battle, rallies his "band of brothers." That phrase may be best known these days as the title of an HBO series about World War II, but it dates back to 1599, and belongs to the most stirring call to arms in the English language. And though the character of man may be the same, the methods of war have somewhat evolved. In this war we are now fighting, there is a call for many talents, not solely on the battlefield. This is also a global war of information, of technology, of ingenuity. If you want to honor and understand our troops, if you want a reminder of why even at home it is worth looking for any way to contribute, these lines of Shakespeare rank among the mighty gifts of our culture.
* If you want something more recent, punch up the Gettysburg Address. We all toiled through it in high school (I hope), but it bears rereading in full, all three paragraphs--honoring those who died to preserve this nation and what it stands for; that "government of the people, by the people, for the people, shall not perish from the earth."
* For a contemporary view, read Charles Krauthammer's speech at this past February's American Enterprise Institute annual dinner: "Democratic Realism: An American Foreign Policy for a Unipolar World." Here you will find the real issues. Whether you agree or not, Mr. Krauthammer provides a brilliant and lucid account of America's character, culture and choices in this post-Sept. 11 world.
* Get your hands on an old black-and-white movie, Fritz Lang's "M," filmed in Berlin in 1931, which has more to say about terror, and the stopping of it, than just about anything produced in the 73 years since. It is the story of a child-killer, a murderer of innocents, stalking a terrorized city. The police finally rid the city of this monster by making life so unbearable for the ordinary criminals that the lords of the criminal underworld run him down themselves. It's a terrific blueprint for dealing with terrorists and the regimes with which they consort, such as Syria and Iran.
Pick up one of those classics on the best within us, and never mind if it's not set in color and segmented into 30-second sound bites. Rent "Inherit the Wind," in which Spencer Tracy defends the right of a man to think for himself. Sit back with a copy of Harper Lee's "To Kill a Mockingbird," in which small-town southern lawyer Atticus Finch faces down the mob to do what he knows is right.
And, if you have, as recommended at the top of this column, begun by taking a deep breath--exhale. When you get back to the TV news, and tune in for the fall season, it's going to feel just a bit more manageable.
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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Roberts Rules
The Intelligence Chairman at least has the right opponents.
Wednesday, August 25, 2004 12:01 a.m. EDT
Say this for Kansas Senator Pat Roberts's startling new proposal to blow up the American intelligence bureaucracy: He has certainly demonstrated the folly of Washington rushing to fix all of this before the election.
Mr. Roberts, the GOP chairman of the Senate Intelligence Committee, has in essence seen the recent proposal by the 9/11 Commission and raised it. Most radically, he would dismantle the CIA into three separate agencies responsible for operations, analysis and technology. He then would bring them, and the intelligence agencies now in the Pentagon, under the control of the new national intelligence director. All of that and presumably keep fighting al Qaeda at the same time.
We'll want to learn more, but our first reaction is to be skeptical of any plan that takes well-run intelligence assets away from the Defense Department, especially with troops currently fighting around the world. Our recent notorious intelligence failures haven't been the fault of the Defense Intelligence Agency, which gathers battlefield intelligence, or the National Security Agency, which is responsible for electronic spying.
Some 80% of the $40 billion annual intelligence budget goes to Defense, and roughly three-quarters of that sum is spent on satellites, eavesdropping equipment and other hard assets that everyone in the intelligence community relies on. Perhaps some of these tasks can be done better, but no one questions that this aspect of our intelligence community functions at a high level.
We're also skeptical of Mr. Roberts's plan to divide up the CIA into three parts, like Caesar in Gaul. The agency needs shaking up, but that is more a function of leadership and mindset rather than rearranging the bureaucrat-spies. It also risks putting more barriers between operatives and analysts, when experience teaches that when they work together they produce a superior product. A good example is the first Gulf War, when aviators, sailors and intel officers, working together, came up with a way to take down Iraq's air defense system.
We'd give Mr. Roberts more credit if his 139 pages of reform proposals addressed the problems caused by Congressional micromanagement. As the 9/11 report points out, but too few seem to have noticed, "Congressional oversight for intelligence--and counterterrorism--is dysfunctional." Senator Roberts's committee is partly responsible for this mess, so we'd like to know how it is going to heal itself.
But at least Mr. Roberts has exposed how little agreement there yet is in Washington about intelligence reform. The 9/11 report gave the illusion of consensus because of its unanimous recommendations. John Kerry quickly piled on, without much reflection and for his own political purposes, and the White House has played politics itself in trying to look like it is in favor of ideas that it really opposes. (So far Donald Rumsfeld is one of the few people who's been willing to suggest that everyone take some time to think.)
The more we read the Commission report's fine print, the more that document looks like a lowest-common-denominator proposal that was agreed to mainly so the members could say they agreed on something. So they fell back on the safe and familiar Washington remedy of creating a new bureaucracy to fix the old one. Mr. Roberts now comes along to recommend more radical surgery, and he has the support of seven of his eight Republican committee colleagues.
Breaking with tradition, he didn't brief the Democrats before announcing his proposal on a Sunday morning talk show. Co-chairman Jay Rockefeller rushed to condemn it as a "serious mistake," as did Democratic members Carl Levin and Dianne Feinstein. They were joined by former CIA chief George Tenet, who declared that the proposal "reflects a dangerous misunderstanding of the business of intelligence." We'll concede that anything opposed by this bunch can't be all bad.
Meanwhile, Porter Goss's confirmation hearing to be CIA director is scheduled for early next month, the Senate Governmental Affairs Committee is charged with drafting legislation in response to the 9/11 panel's report, and the White House is still working on executive orders and Presidential directives that can be issued without legislation. And that's all before the Laurence Silberman-Chuck Robb intelligence-review panel that won't report until next March.
The larger point here is that there's no need to rush to any quick political fix. We are contemplating the biggest change in our intelligence services since 1947, while we are also fighting a war against a lethal enemy. That work should take some time--and, Beltway forbid, maybe even a little thought.

>> BRIEF


Entire Iranian leadership attended missile test...
Iran 'ecstatic' with Chinese missile navigation system
The Iranian Revolutionary Guard Corps last week demonstrated the integration of a system that turns the Shihab-3 intermediate-range ballistic missile from a flying metal tube into a deadly weapon against Israel, Saudi Arabia and the United States. The Shihab-3's problem has not been its range, but its accuracy. But the missile, based on the North Korean No Dong, was not accurate. The Iranians appeared to have changed all that...

North Korea braces for death of Kim Jong-Il's wife, 'respected mother'...


-------------------------------------------------
>> BUSH


The Last Word: Is Bush an Israeli shill? Or a Saudi one?
By BRET STEPHENS
Pretty soon, the Anyone But Bush crowd is going to have to decide: Is the American president an Israeli shill or is he a Saudi shill? Does he do the bidding of the insidious pro-Israel neocons or of the insidious pro-Arab oil lobby? Is his foreign policy everything his father's was not - and therefore disastrous - or is it an extension of it - and therefore equally disastrous?
A LONG time ago - this would have been 2002 and the early months of 2003- the first set of views held sway. "The Bush administration paints a rosy scenario for the upcoming war in Iraq," wrote University of Chicago professor Fred Donner in the Chicago Tribune. "It is a vision deriving from Likud-oriented members of the President's team - particularly Richard Perle, Paul Wolfowitz and Douglas Feith." On MSNBC's Hardball, host Chris Matthews observed that the war party consisted of "conservative people out there, some of them Jewish, who... believe we should fight the Arabs and take them down. They believe that if we don't fight Iraq, Israel will be in danger." In the pages of The Nation, the venerable organ of Leftist certitude, writer Jason Vest spun elaborate theories about the nefarious influence of the Jewish Institute for National Security Affairs, or JINSA, on administration policy.
At the same time, alarms were being sounded about some of the lunatic ideas making the rounds at Club Neocon. In July 2002, Rand Corporation analyst Laurent Murawiec gave a briefing to Mr. Perle's Defense Policy Board, in which he called Saudi Arabia "the kernel of evil, the prime mover, the most dangerous opponent" of American interests in the Middle East. Tom Ricks, the Washington Post reporter who broke the story about the briefing, noted the anti-Saudi line was gaining traction in such magazines as The Weekly Standard and Commentary, which, he helpfully added, "is published by the American Jewish Committee."
The president's critics went into a tizzy. Crown Prince Abdullah had only recently proposed an Arab-Israeli peace plan, and the Saudis were still in pretty good odor. Mr. Murawiec, wrote Jack Shafer in Slate, "lights out for the extreme foreign policy territory," and sounds like "an aspiring Dr. Strangelove."
Finally, 2002 was the year when administration critics rediscovered the sublime genius of Bush pere and his foreign policy team. Former National Security Adviser Brent Scowcroft, former Secretaries of State James Baker and Larry Eagleburger, and retired General Norman Schwarzkopf all cautioned against the rush to war. Invidious comparisons were made between their statesmanlike prudence and the callow impetuousness of Bush fils.
HOWEVER, THAT was then. These days, everyone knows that President Bush is nothing if not his father's son - not to mention Prince Bandar's poodle.
"The links between the House of Bush and the House of Saud," wrote Michael Steinberger in the October 2003 issue of the American liberal monthly, The American Prospect, "are deep, overlapping and notoriously opaque: The Saudi investment in the Carlyle Group, the private equity firm whose rainmakers include George Bush Senior; the Saudi bankrolling of Poppy's presidential library; the lucrative contracts the Saudis doled out to Halliburton when Dick Cheney was at the company's helm. The main law firm retained by the Saudis to defend them against the 9-11 families is Baker Botts - as in James Baker, the Bush family consigliere. And, of course, there's oil, the black glue connecting all the dots."
These arguments were picked up in Craig Unger's bestselling House of Bush, House of Saud, and amplified in Michael Moore's Fahrenheit 9/11. For Mr. Unger, the point of departure is the White House's post 9-11 decision to allow members of the bin Laden clan to leave for Saudi Arabia, while Mr. Moore makes much of the $1.4 billion Saudi Arabia paid over the years to Carlyle-connected enterprises.
True, the guy who gave the go-ahead for the flight of the bin Ladens was Richard Clarke, neither pere nor fils was ever shown to have profited from a Carlyle-orchestrated/Saudi-connected deal, and Carlyle is run by Carter administration official David Rubenstein. Also, the Clinton administration, like every administration since Franklin Roosevelt's, had been close to the House of Saud: In his memoirs, Bill Clinton reports that in February 1994 "We got a piece of good news when Saudi Arabia agreed to buy $6 billion worth of American planes, after intense efforts by Ron Brown, Mickey Kantor and Transportation Secretary Frederico Pena."
But never mind. What's really interesting is how much Messrs. Moore, Unger and Steinberger sound like those scary neocons of yesteryear. "The desert kingdom leads the way in financing and inciting Muslim holy warriors the world over," wrote Mr. Steinberger in his American Prospect article. So what's the difference between him and Mr. Murawiec? Answer: politics.
"It wouldn't take much for the Democrats to turn [the Saudi] issue into a political bonanza...." Steinberger writes. "The Saudi issue is a winning one on every count for the Democrats, and they need to take advantage of it - now." Which is just what Mr. Moore has done.
Of course, Mr. Steinberger is right - as Mr. Murawiec was right - that Saudi Arabia is no friend of the United States. He is also right that the Bush administration hasn't formulated a musular or even coherent policy toward the Kingdom, and so is vulnerable to criticism on the subject.
Then again, wasn't one of the main points of the war in Iraq to remove US military bases from Saudi Arabia, and therefore extricate America from an entaglement begun during the first Bush administration? And don't the shortcomings of administration policy stem in part from the neuralgic reaction by the Arabist wing of the State Department to Mr. Murawiec's ideas and the ideology he represents? Presumably, if the neocons had been allowed to run the show in the Bush White House, the 82nd Airborne would now be stationed in Mecca selling tickets to the next Hajj. Maybe that's something we can soon look forward to in the Kerry presidency.
IN ITS review of Fahrenheit 9/11, al-Jazeera.net noted "the implicit suggestion that the Saudi government is somehow driving the Bush administration's policies toward the region flies in the face of Washington's unprecedented support for Israel as well as strong regional opposition to the invasion of Iraq."
It's a good thing at least some people have got their stories straight. Because either you believe the Jews are behind it all, or you believe the Saudis are. But not both. This is one conspiracy theory on which flip-flopping is not allowed.
bret@jpost.com
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ventre de "une"
En campagne, les bushismes sont de retour
LE MONDE | 17.08.04 | 17h45
A 12 h 15 par e-mail, d?couvrez toute l'actualit? ?conomique et financi?re. Abonnez-vous au Monde.fr, 5? par mois
New York de notre correspondante
On s'en voudrait d'alimenter l'antiam?ricanisme, mais il faut bien le constater : les bushismes sont de retour. Parcourant les chemins de la campagne ?lectorale, le pr?sident est contraint de s'?carter de ses discours ?crits et de r?pondre ? toutes sortes de questions impr?vues.
Comme il y a quatre ans, pendant la campagne 2000, les commentateurs ont entrepris de recenser ses erreurs de grammaire ou de syntaxe, les bushismes.
Le journaliste Jacob Weisberg, qui a publi? les pr?c?dents sous forme de recueils, a repris sa chronique "Bushismes du jour" sur Slate, le magazine en ligne de Microsoft. Il y publie de simples paragraphes, extraits de discours ou d'interviews.
Exemple : Washington, le 5 ao?t. Le pr?sident intervient sur la guerre antiterroriste. "Nos ennemis sont pleins d'innovation et de ressources, dit-il. Nous aussi." "Ils ne cessent jamais de r?fl?chir ? de nouveaux moyens de faire du tort ? notre pays et ? notre peuple", ajoute-t-il. "Et nous non plus."
Il arrive aussi au pr?sident de surprendre par ses commentaires. Au Nouveau-Mexique, il a racont? combien il ?tait heureux que John McCain, son ancien rival, soit venu le soutenir. Ils avaient pass? la nuit dans le ranch pr?sidentiel. "Il n'y a rien de tel que de se lever le matin, d'attraper une tasse de caf?, de monter dans le pick-up, de rouler et de regarder les vaches, a-t-il expliqu?. C'est ce que John et moi avons fait ce matin. C'est un bon moyen de s'?claircir les id?es et de garder du recul."
Selon la presse am?ricaine, les auditoires des meetings du pr?sident sont g?n?ralement choisis par les militants r?publicains locaux. Les questions embarrassantes sont rares. Dans la derni?re tourn?e de M. Bush, la correspondante du New York Times a trouv? une assistance conquise, voire idol?tre. "J'ai 60 ans et j'ai toujours vot? r?publicain. Mais je voulais dire que c'est la premi?re fois que j'ai senti que Dieu ?tait ? la Maison Blanche", a dit un participant de Niceville, en Floride. "Merci", a r?pondu le pr?sident en toute simplicit?. Un enfant de l'Oregon a de son c?t? demand? au pr?sident ce qu'il pouvait faire pour l'aider ? ?tre ?lu. "Merci, a encore r?pondu M. Bush. Voil? le genre de question que j'aime."
Corine Lesnes

* ARTICLE PARU DANS L'EDITION DU 18.08.04
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>> IRAN


Tehran threatens pre-emptive attack
By Laurent Lozano
AGENCE FRANCE-PRESSE
TEHRAN -- In a marked escalation of a war of words between Iran and its archenemies Israel and the United States, Tehran has threatened a pre-emptive strike against U.S. troops in the region.
"We will not sit [and] wait for what others will do to us. Some military commanders in Iran are convinced that preventive operations that the Americans talk about are not their monopoly," Defense Minister Ali Shamkhani told Al Jazeera television Wednesday when asked whether Iran would respond to a U.S. attack on its nuclear facilities.
An exchange of threats between Israel and Iran in recent weeks has led to speculation of a repeat of Israel's strike against Iraqi nuclear facilities at Osirak in 1981. But analysts say such an attack is unlikely because of sensitivity to the U.S. position in Iraq and the fact that Iran's nuclear facilities are scattered across the country.
Asked about the possibility of an American or Israeli strike against Iran's atomic power plant being built in Bushehr, Mr. Shamkhani said: "We will consider any strike against our nuclear installations as an attack on Iran as a whole, and we will retaliate with all our strength.
"Where Israel is concerned, we have no doubt that it is an evil entity, and it will not be able to launch any military operation without an American green light. You cannot separate the two."
A commander of Iran's elite Revolutionary Guards was quoted in the Iranian press on Wednesday as saying that Tehran would strike the Israeli reactor at Dimona if Israel attacks the Islamic republic's burgeoning nuclear facilities.
"If Israel fires one missile at Bushehr atomic power plant, it should permanently forget about Dimona nuclear center, where it produces and keeps its nuclear weapons, and Israel would be responsible for the terrifying consequence of this move," Gen. Muhammad Baqer Zolqadr said.
Mr. Shamkhani said the U.S. military presence in Iraq "will not become an element of strength [for Washington] at our expense. The opposite is true, because their forces would turn into a hostage" in Iranian hands in the event of an attack.
"America is not the only one present in the region. We are also present, from Khost to Kandahar in Afghanistan; we are present in the Gulf, and we can be present in Iraq," he said.
Israel and the United States see Iran's bid to generate nuclear power at the Bushehr plant as a cover for nuclear-weapons development.
Mr. Shamkhani warned that in the event of an attack on its nuclear facilities, Iran would consider itself no longer bound by its commitments to the International Atomic Energy Agency.
The U.N. agency is investigating Iran's bid to generate electricity through nuclear power. The Islamic republic has agreed to temporarily suspend uranium enrichment pending the completion of the probe.

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Hizbullah 'more highly prepared' than ever for Israel
Special to World Tribune.com
MIDDLE EAST NEWSLINE
Friday, August 20, 2004
NICOSIA √ Hizbullah said it is better prepared than ever for a military confrontation with Israel.
The Iranian-sponsored insurgency group has built a formidable array of defenses and gathered an arsenal in southern Lebanon for an attack on Israel. Hizbullah said its forces have been trained for war with Israel along its border with Lebanon.
"We are now highly prepared to face Israel," Hizbullah deputy secretary-general Naim Qassem said. "We are more highly prepared than at any previous time."
In an interview with the Beirut-based Daily Star, Qassem said Hizbullah has opened a second front against Israel in the West Bank and Gaza Strip. He acknowledged that Hizbullah has provided Palestinian insurgents with financing, training and weaponry.
"The battle with Israel is not at an end," Qassem said on Wednesday. "We are always in expectation of an Israeli attack in Lebanon. That's why Hizbullah continues with its logistics and training to prepare its members for any eventuality in facing attacks by Israel."
Israeli officials said Hizbullah has deployed 12,000 rockets and missiles in Lebanon. The group restructured its command in 2002 amid accelerated training from the Iranian Revolutionary Guard Corps.
On Aug. 17, the Kuwaiti daily Al Siyassa reported that two cargo aircraft landed in Damascus in early August with 220 missiles for Hizbullah.
The newspaper quoted Syrian opposition sources in London as saying that the enhanced Iranian missiles have a range of between 250 and 350 kilometers and could hit any target in Israel.
Al Siyassa said the missiles were transported in Lebanese and Syrian trucks to three Hizbullah military bases along the Syrian border. The newspaper said the missiles would be used in response to any Israeli attack on Iranian nuclear facilities.
In July, Hizbullah accused Israel of assassinating a senior operative, Ghaleb Awali. Alawi was identified by Hizbullah as its liasion with Palestinian insurgency groups.
In the interview, Qassem said Hizbullah sought to fight Israel along any front. He said his group constantly sought to exploit deficiencies in Israel's military.
"We believe we should stand by the side of the Palestinians because it is our cause too, for religious reasons and moral reasons," Qassem said.
"That's why we support the uprising with all the means we can. You can put anything you want under 'all.'"
In an appearance on Wednesday, Qassem rejected U.S. efforts to end the Syrian occupation of Lebanon. He said Washington did not have any right to interfere in Lebanon's domestic or foreign policy.
"We, the Lebanese, have chosen the presence of Syrian troops," Qassem said. "If, one day, we decide that this presence is no longer necessary then they will withdraw. But we believe that they are a necessity for Lebanon."
Meanwhile, Hassan Nasrallah was given a rousing endorsement for his continued leadership of the Iranian-sponsored Hizbullah.
Nasrallah, 44, was elected unanimously to continue for at least another three years as secretary-general of Hizbullah. He has been in the post since 1992.
A Hizbullah statement on Monday said the national congress reelected all of the members of the Shura Council. In turn, the seven-member consultative council chose Nasrallah to remain as chief of the insurgency group. This will be Nasrallah's fifth term.
Nasrallah has been a founding member of Hizbullah, and replaced the late Abbas Mussawi, assassinated by Israel, in 1992. He frequently travels to Teheran to consult with the Iranian Revolutionary Guard Corps and ruling clerics regarding Hizbullah strategy.
Under Nasrallah, Hizbullah forced Israel to withdraw from southern Lebanon in 2000 and then took over the area. The group, which launches regular attacks on Israeli troops and civilians, was said to have 12,000 rockets and missiles along the Israeli-Lebanese border.
The statement said the Shura Council would announce the portfolios of its members of the new few days.
Hizbullah, regarded by the State Department as the leading Islamic insurgency group in the world, has also participated in Lebanese politics.
The group has nine legislators in the 128-member parliament.


Copyright ╘ 2004 East West Services, Inc.

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Iranian economic reform falters
Oil is the lifeblood of Iran's economy
The Iranian parliament on Sunday voted against key parts of a reform plan aimed at opening up the economy to foreign investment.
The rejected proposals would have given oil exploration companies the right to exploit their discoveries.
They would also have paved the way for the sale of state-run banks, and allowed foreign banks to open in Iran.
The vote marks a setback for Iran's reformists, who lost control of the parliament in February.
Oil economy
The rejected measures formed a central plank of an ambitious five-year reform plan aimed at stimulating Iran's battered economy by privatising some state-owned companies, and attracting more foreign investment.
Analysts say that without foreign money, Iran is unlikely to achieve its objective of doubling its oil output to 8 million barrels a day by 2020.
Foreign oil firms had welcomed the proposal to give exploration companies the automatic right to exploit reserves they discover.
At present, successful exploration companies must enter a state-run tender to develop their discoveries, with no guarantee of success.
The failure of the proposed overhaul of the banking sector looks set to scupper tentative plans by some western banks to set up shop in Iran.
Standard Chartered and HSBC are among big-name banks thought to have expressed an interest in opening branches in Tehran.
Foreign influence
Mohammad Mir-Mohammadi, a conservative member of parliament, said the vote had prevented "foreign dominance over Iran's economy".
Iran is under pressure to maintain high rates of economic growth so as to provide employment for its large and fast-growing workforce.
High oil prices have fuelled strong expansion in recent years, but economists say the country urgently needs to reduce its dependence on oil.
The Iranian economy is dominated by the state and its infrastructure, battered by the Iran-Iraq war and starved of investment as a result of US-imposed economic sanctions, is in urgent need of upgrading.
Iran's reformist president, Mohammad Khatami, has championed efforts to modernise the economy and attract foreign investment since taking office in 1997.
But in February, his followers in parliament lost their majority to conservative hardliners after voters became disillusioned with a lack of economic progress.

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>> IRAQ

What Went Wrong in Iraq
By Larry Diamond
From Foreign Affairs, September/October 2004

Summary: Although the early U.S. blunders in the occupation of Iraq are well known, their consequences are just now becoming clear. The Bush administration was never willing to commit the resources necessary to secure the country and did not make the most of the resources it had. U.S. officials did get a number of things right, but they never understood-or even listened to-the country they were seeking to rebuild. As a result, the democratic future of Iraq now hangs in the balance.
Larry Diamond is Co-editor of the Journal of Democracy and Senior Fellow at Stanford University's Hoover Institution. From January to April 2004, he served as a Senior Adviser to the Coalition Provisional Authority in Baghdad.
BLUNDERING IN BAGHDAD
With the transfer of power to a new interim Iraqi government on June 28, the political phase of U.S. occupation came to an abrupt end. The transfer marked an urgently needed, and in some ways hopeful, new departure for Iraq. But it did not erase, or even much ease at first, the most pressing problems confronting that beleaguered country: endemic violence, a shattered state, a nonfunctioning economy, and a decimated society. Some of these problems may have been inevitable consequences of the war to topple Saddam Hussein. But Iraq today falls far short of what the Bush administration promised. As a result of a long chain of U.S. miscalculations, the coalition occupation has left Iraq in far worse shape than it need have and has diminished the long-term prospects of democracy there. Iraqis, Americans, and other foreigners continue to be killed. What went wrong?
Many of the original miscalculations made by the Bush administration are well known. But the early blunders have had diffuse, profound, and lasting consequences-some of which are only now becoming clear. The first and foremost of these errors concerned security: the Bush administration was never willing to commit anything like the forces necessary to ensure order in postwar Iraq. From the beginning, military experts warned Washington that the task would require, as Army Chief of Staff Eric Shinseki told Congress in February 2003, "hundreds of thousands" of troops. For the United States to deploy forces in Iraq at the same ratio to population as NATO had in Bosnia would have required half a million troops. Yet the coalition force level never reached even a third of that figure. Secretary of Defense Donald Rumsfeld and his senior civilian deputies rejected every call for a much larger commitment and made it very clear, despite their disingenuous promises to give the military "everything" it asked for, that such requests would not be welcome. No officer missed the lesson of General Shinseki, whom the Pentagon rewarded for his public candor by announcing his replacement a year early, making him a lame-duck leader long before his term expired. Officers and soldiers in Iraq were forced to keep their complaints about insufficient manpower and equipment private, even as top political officials in the Coalition Provisional Authority (CPA) insisted publicly that greater military action was necessary to secure the country.
In truth, around 300,000 troops might have been enough to make Iraq largely secure after the war. But doing so would also have required different kinds of troops, with different rules of engagement. The coalition should have deployed vastly more military police and other troops trained for urban patrols, crowd control, civil reconstruction, and peace maintenance and enforcement. Tens of thousands of soldiers with sophisticated monitoring equipment should have been posted along the borders with Syria and Iran to intercept the flows of foreign terrorists, Iranian intelligence agents, money, and weapons.
But Washington failed to take such steps, for the same reasons it decided to occupy Iraq with a relatively light force: hubris and ideology. Contemptuous of the State Department's regional experts who were seen as too "soft" to remake Iraq, a small group of Pentagon officials ignored the elaborate postwar planning the State Department had overseen through its "Future of Iraq" project, which had anticipated many of the problems that emerged after the invasion. Instead of preparing for the worst, Pentagon planners assumed that Iraqis would joyously welcome U.S. and international troops as liberators. With Saddam's military and security apparatus destroyed, the thinking went, Washington could capitalize on the goodwill by handing the country over to Iraqi expatriates such as Ahmed Chalabi, who would quickly create a new democratic state. Not only would fewer U.S. troops be needed at first, but within a year, the troop levels could drop to a few tens of thousands.
Of course, these naive assumptions quickly collapsed, along with overall security, in the immediate aftermath of the war. U.S. troops stood by helplessly, outnumbered and unprepared, as much of Iraq's remaining physical, economic, and institutional infrastructure was systematically looted and sabotaged. And even once it became obvious that the looting was not a one-time breakdown of social order but an elaborately organized, armed, and financed resistance to the U.S. occupation, the Bush administration compounded its initial mistakes by stubbornly refusing to send in more troops. Administration officials repeatedly deluded themselves into believing that the defeat of the insurgency was just around the corner-just as soon as the long, hot summer of 2003 ended, or reconstruction dollars started flowing in and jobs were created, or the political transition began, or Saddam Hussein was captured, or the interim government was inaugurated. As in Vietnam, a turning point always seemed imminent, and Washington refused to grasp the depth of popular disaffection.
Under its chief administrator, Ambassador L. Paul Bremer III, the CPA (which ruled Iraq from May 2003 until June 2004) worked hard and creatively to craft a transition to a legitimate, viable, and democratic system of government while rebuilding the overall economy and society. As I saw during my brief tenure as a senior CPA adviser on governance earlier this year, the U.S. administration got a number of things right. But one cannot review the political record without underscoring the pervasive security deficit, which undermined everything else the coalition sought to achieve.
NATIONAL INSECURITY
Any effort to rebuild a shattered, war-torn country should include four basic components: political reconstruction of a legitimate and capable state; economic reconstruction, including the rebuilding of the country's physical infrastructure and the creation of rules and institutions that enable a market economy; social reconstruction, including the renewal (or in some cases, creation) of a civil society and political culture that foster voluntary cooperation and the limitation of state power; and the provision of general security, to establish a safe and orderly environment.
These four elements interact in intimate ways. Without legitimate, rule-based, and effective government, economic and physical reconstruction will lag and investors will refuse to risk their capital to produce jobs and new wealth. Without demonstrable progress on the economic front, a new government cannot develop or sustain legitimacy, and its effectiveness will quickly wane. Without the development of social capital-in the form of horizontal bonds of trust and cooperation in a (re)emerging civil society-economic development will not proceed with sufficient vigor or variety, and the new system of government will not be properly scrutinized or supported. And without security, everything else grinds to a halt.
In postconflict situations in which the state has collapsed, security trumps everything: it is the central pedestal that supports all else. Without some minimum level of security, people cannot engage in trade and commerce, organize to rebuild their communities, or participate meaningfully in politics. Without security, a country has nothing but disorder, distrust, and desperation-an utterly Hobbesian situation in which fear pervades and raw force dominates. This is why violence-ridden societies tend to turn to almost any political force that promises to provide order, even if it is oppressive. It is a big reason why the CPA was unable to spend most of the $18.6 billion for Iraqi reconstruction appropriated by Congress last fall. And it explains why a country must first have a state before it can become a democracy. The primary requirement of a state is that it hold a monopoly on the use of violence. By that measure, the body that the United States transferred power to in Baghdad on June 28 may have been a government-but it was not a state.
Even though insufficient forces were deployed to Iraq, much more could have been done with them to build security and contain the forces of disorder before the handoff. Unfortunately, not only did the CPA lack the resources for the job, it also lacked the understanding and organization. The effort to create a new Iraqi police force, for example, withered from haste, inefficiency, poor planning, and sheer incompetence. Newly minted Iraqi cops were rushed onto the job with too little training, insufficient vetting, and shamefully inadequate equipment. Although most had uniforms (of a sort), they lacked cars, radios, and body armor and were often outgunned by the criminals, terrorists, and saboteurs they faced. As vital symbols of the new Iraqi state, the police also quickly became "soft targets" for terrorist attacks, and coalition forces did too little too late to protect them.
Iraqi politicians, civic leaders, and government officials, as well as civilian coalition officials and their Iraqi aides, paid a heavy price for the lack of security. More than 100 Iraqi government workers were killed during the occupation, including several high-level officials and the occupant of the Governing Council's rotating presidency. Iraqis collaborating with the occupation (including those lining up for jobs) became targets-especially translators, a fact that worsened the CPA's already severe language gap. Although few CPA officials themselves were killed, many were attacked, and numerous civilian contractors were slain or kidnapped.
Insecurity drove the political occupation into a physical and psychological bunker. Already separated from Iraqis by the formidable security around the three-square-mile "Green Zone" (where the CPA was based) and around the CPA's regional and provincial headquarters, coalition officials began to travel less and less with every passing month. By the early spring of this year, foreign officials and contractors could no longer safely move around the country without an armored car and a well-armed escort. And even these precautions failed to protect them from well-placed and powerful roadside bombs. The most secure means of transportation, helicopters, were usually unavailable to all but the highest officials-one of many shortages that lasted throughout the occupation and that the Pentagon was very slow and very inefficient in addressing.
Also absent was the determination to face down political threats, as the case of Muqtada al-Sadr made painfully clear. Sadr, a radical young Shiite cleric, sought to fan and exploit anti-American, nationalist, and Islamist sentiments in a bid for power. Although he lacked the religious knowledge and authority of his father (who was assassinated in 1999) or of more senior and respected Shiite clerics, Sadr managed to build a following among disaffected, unemployed, and poorly educated young men in Iraq's cities. The coalition should have quickly developed a strategy to counter him and his al-Mahdi militia. Some Shiite leaders urged that Sadr be co-opted into the political process, while many moderate Shiites and CPA officials urged that he be dealt with through legal or military means. But the CPA did none of these things; instead, it prevaricated. In August 2003, the Iraqi Central Criminal Court issued arrest warrants for Sadr and 11 of his top henchmen (for the April 2003 murder of a moderate Shiite cleric, Ayatollah Majid al-Khoei). But the CPA kept the arrest warrants sealed, and over the subsequent months, as Sadr kept pushing, U.S. officials waited, warned, wavered, hesitated, and debated. Although coalition figures knew that Sadr's organization had to be put out of business before any kind of decent political order could arise in Iraq, the various plans drawn up to take him down were never executed, apparently because Washington decided that the risks were too great. The same administration that was bold enough to launch an unpopular war against Saddam blanched at the prospect of confronting a bully such as Sadr-even though he was reviled by the majority of the Shiite population and the religious establishment.
There was certainly no shortage of warning signs, provocations, and justifications for removing Sadr. In October 2003, coalition forces intercepted dozens of busloads of his heavily armed followers as they headed to Karbala to seize control of the city and its holy shrines. On March 12 of this year, Sadr's forces leveled the Gypsy village of Qawliyya, sending most of its 1,000 residents fleeing. That same month, Sadr's organization publicly called for the assassination of Sayyid Farqad al-Qizwini, the most influential pro-U.S. cleric in Iraq's Shiite heartland, and a number of his associates in a U.S.-supported pro-democracy movement. For six months, Sadr's army and organization grew alarmingly in size, muscle, and daring. In a Taliban-style bid for social power, they seized public buildings, beat up moderate professors, took over classrooms, forced women to wear the hijab, set up illegal sharia courts, and imposed their own brutal penalties. Meanwhile, new Mahdi army recruits openly trained for terror and mayhem.
Yet when the coalition finally decided to act against them, its approach was impromptu and incomprehensibly chaotic. On March 28, Bremer ordered the closure of Sadr's incendiary newspaper, Hawza, but did nothing to strike against the more dangerous elements of Sadr's organization. The cleric reacted by ordering his followers to rise up against the occupation. A few days later, on April 2, coalition forces arrested a top Sadr aide, Mustafa al-Yaccoubi, and Sadr responded by unleashing a full-scale insurgency in the Shiite south, for a time seizing control of Najaf, Karbala, and many other strategic sites and forging tactical ties with the Sunni insurgents who had taken control of Fallujah. In the subsequent weeks, after conceding control of Fallujah to a hastily constructed local militia that promised to reassert order, U.S. forces finally went to war with the Mahdi army, evicting it from most of its strongholds, killing or arresting many of its leaders, and largely defeating its troops. But Sadr remained at large, mocking the coalition's demand for his arrest and maneuvering for power.
Not only did the fighting in April and May fail to eliminate Sadr's forces, it also did nothing to counter Iraq's other heavily armed militias. These include not only the battle-hardened Kurdish Pesh Merga (which number at least 50,000 fighters) but also the large and well-armed militias of the two most important Shiite religious parties, SCIRI (the Supreme Council for Islamic Revolution in Iraq) and Dawa. At the beginning of 2004, the CPA began negotiating an agreement with these militias for their disarmament, demobilization, and reintegration (DDR) into the new Iraqi police and armed forces. The CPA's plan was intelligent and comprehensive in design. But the Kurds, understandably wary of any new central Iraqi government, refused to agree to anything more than a superficial integration of their forces (with command structures intact) into the new Iraqi military, and it remains unclear whether the other large militias will truly demobilize and disarm or just warehouse their heavy weapons while temporarily joining the new armed forces. The ddr plan was supposed to have been finalized and announced on May 1. But it was set back seriously by the outbreak of twin insurgencies in Fallujah and the Shiite south in April. The U.S. military was forced to rely on the cooperation (or at least forbearance) of the SCIRI and Dawa militias to evict and defeat the Mahdi army, and this sharply reduced the CPA's leverage over them. The plan was finally released in early June, but with little time left to implement it before the transfer of power. Even as the CPA insisted that the Mahdi army's failure to comply would disqualify Sadr from participating in electoral politics, other Iraqi political leaders began negotiating with him to try to bring him into the political game.
It now seems unlikely that the weak and besieged new Iraqi government will have the will or capacity to enforce the demobilization plan. In fact, the new Iraqi state is caught in a Catch-22: to be viable, it must build up its armed forces as rapidly as possible. But the readiest sources of soldiers and police are the most powerful militias, which will probably allow their fighters to join the new military only if their command structures remain intact. Thus, if the fledgling Iraqi state hopes to truly defeat the militias, it may have to go to war with itself. That seems hard to imagine. Yet if Iraq tries to hold elections while the militias remain intact (in one guise or another), the campaign is likely to become a very bloody and undemocratic affair. Candidates will face assassination, weaker political opponents will be run out of town, and the electoral machinery will be hijacked by those with the most guns.
Even if the security situation improves enough to allow elections to go forward on time, Iraq could still get into further trouble if it follows the UN's recommendation and uses a national-list system, apportioning seats in parliament on the basis of nationwide voting, since this would give the big regional and religious parties an added incentive to inflate their numbers through force and fraud. Should that occur, the biggest winners will be the best-armed and most-organized forces-the Kurds in the far north and the Iranian-backed Islamist parties in the Shiite south. The American occupation could wind up paving the way for the "election" of an Iranian-linked Islamist government in Baghdad.
CLOSING THE LEGITIMACY GAP
As the last year in Iraq has made clear, decent governance is not possible without some minimal level of security. But security could not have been improved without significant progress on the political front. This was true in several respects. First, although some of the terrorist violence (particularly the suicide car bombings) was organized by outside forces, as the Bush administration claimed, much of it (including roadside bombings, the killing of contractors, and other forms of sabotage) was committed by Iraqis, mainly Sunnis who turned against the occupation because they believed it excluded them politically. Second, young Shiite men rose up in arms when their lack of access to jobs and other opportunities rendered them vulnerable to the appeals of militants such as Sadr. Third, political tensions raised the worrisome prospect of violence between Iraq's Kurds and Arabs, both on the volatile boundaries of the Kurdistan region (especially Kirkuk, where militant Kurds wanted to expel Arabs who had settled there during Saddam's campaign of "Arabization") and in the larger struggle over the future shape of the country. And fourth, the challenge of demobilizing the militias while building up the new Iraqi armed forces was largely a political problem. In all these cases, containing the violence required not only a strong and adept military response but also a sustained political effort to construct a broad-based, inclusive system with which all major Iraqi groups could identify.
The United States, however, lacked an effective political strategy for postwar Iraq, as became clear almost immediately after the invasion, when former General Jay Garner's ill-fated Office of Reconstruction and Humanitarian Assistance took charge in Baghdad. Part of the problem was that both Garner and Bremer never comprehended how Iraqis perceived them. Throughout the occupation, the coalition lacked the linguistic and area expertise necessary to understand Iraqi politics and society, and the few long-time experts present were excluded from the inner circle of decision-making in the CPA. Thus the coalition never grasped, for example, the fact that, although most Iraqis were grateful for having been liberated from a brutal tyranny, their gratitude was mixed with deep suspicion of the United States' real motives (not to mention those of the United Kingdom, a former colonial ruler of Iraq); humiliation that the Iraqis themselves had proved unable to overthrow Saddam; and unrealistic expectations of the postwar administration, which Iraqis expected to quickly deliver them from their problems. Too many Iraqis viewed the invasion not as an international effort but as an occupation by Western, Christian, essentially Anglo-American powers, and this evoked powerful memories of previous subjugation and of the nationalist struggles against Iraq's former overlords.
The CPA also failed to grasp that Saddam retained a base of popular support in Iraq even after his overthrow. Although he had brutalized plenty of Sunnis, much of the Sunni Arab population either supported him or opposed his ouster for fear that regime change would cost them-a 20 percent minority of the population-their historic monopoly over the state and its precious resources.
The occupation compounded its original errors of analysis with two strategic miscalculations. First, it launched a de-Baathification campaign that was much too broad, excluding from any meaningful role in the future state anyone who had held any kind of high-level position in the party, regardless of whether they were directly involved in serious crimes. And the most aggressive and politically ambitious advocate of radical de-Baathification, the controversial Ahmed Chalabi, was put in charge of the program.
The second mistake was made in May 2003, when, as one of his first official acts, Bremer ordered the dissolution of the Iraqi army. The army had already collapsed and scattered at the end of the invasion, and intensive vetting of its officer corps would have been necessary before it could have served any positive function in the new Iraqi state. Still, by formally dissolving it, the CPA lost the opportunity to reconstitute some portions of it to help restore order, and it left tens of thousands of armed soldiers and officers cut out of the new order and prime candidates for recruitment by the insurgency. Indeed, the American occupation created a context in which former Baathists, mainly Sunnis, not only faced the loss of their previous dominance but were excluded from any real share of power and resources. This situation pushed some Iraqis who might otherwise have been co-opted into the new system toward violent resistance, which came to seem like a rational strategy for driving away the Americans or at least changing the terms they were offering.
The United States also faced a more diffuse political problem in Iraq. Deep local suspicions of U.S. motives combined with the memory of Western colonialism and resentment of the U.S. stance in the Israeli-Palestinian struggle to generate a massive lack of legitimacy for the occupation authority. Washington should have done two things to fill this gap: increased international participation in the political administration of the country (although this would have been difficult given international opposition to the war), and put legitimate Iraqi leaders in visible, meaningful governance roles as soon as possible.
The most straightforward way to do this would have been to hold elections. That was what Ayatollah Ali Sistani, the most revered and influential Shiite religious leader in Iraq, wanted from the beginning. The experience of other postwar transitions, however, counseled strongly against a rapid move to national elections. With no electoral register, no administrative framework to organize balloting, no electoral rules, and no time or space for new political parties to emerge and mobilize, early national elections (any time within the first year of occupation) could well have precipitated a disastrous slide toward violence and polarization-even civil war. And they would likely have been swept in the south by Islamist parties, which enjoyed the huge initial advantage of having pre-existing organizations built up either underground or in exile in Iran.
The occupation pursued a variety of other strategies to fill the legitimacy void, with varying degrees of success. In each of Iraq's 18 provinces, and in most of its cities and larger towns, local coalition military commands, sometimes working with U.S. civilian contractors, formed representative councils through a mix of consultative and deliberative processes. In a few cases, particularly in the far south under British civil and military administration, rough-and-ready elections were organized using the crude method of the ration card system, which registered only Iraqi households, not individuals, but was believed to cover about 90 percent of the population. Officials in Basra province (containing the country's second-largest city) wanted to experiment with direct elections for local councils, but this and other democratic initiatives were vetoed by CPA headquarters, which feared that any example of direct elections would undermine the CPA's insistence that direct elections could not be organized anytime soon. There was also a fear of what elections would produce. As one British official lamented to me, the "CPA [officials] didn't want anything to happen that they didn't control-and this has been impossible to hide from the Iraqis."
The most intractable and debilitating problem with the councils was not their lack of an electoral mandate, however. Indeed, CPA teams worked hard to remove their most corrupt and unrepresentative figures and bring in new faces representing as many groups as possible. In many cases, this process amounted to indirect elections. Rather, the problem with the councils was their evident powerlessness and lack of resources; in some cases, council members had to wait for months to receive their salaries. By failing to invest these councils with real resources and authority, the occupation missed a key opportunity to increase its legitimacy
After three months of costly delay, in July 2003 the occupation did constitute an indigenous national authority, albeit only an advisory one: the Iraqi Governing Council (GC). This body included the representatives of some obviously weighty Iraqi constituencies and political forces, including the two main Kurdish parties (the Kurdistan Democratic Party and the Patriotic Union of Kurdistan), which had ruled the autonomous Kurdish region since its effective liberation from Saddam's tyranny in 1991; two major Shiite political parties, sciri and Dawa; and some older parties (including the communists). Also included were figures close to Ayatollah Sistani and representatives of Iraq's other social forces, including its crucially important tribes.
The GC was not bad as a first step, but it was hobbled by serious flaws. First was the image problem caused by the inclusion of too many controversial Iraqi exiles, particularly Chalabi, in widely visible and powerful roles. Second, the CPA failed to move rapidly enough toward the creation of a more representative and legitimate body. And third, it failed to encourage GC members to reach out and develop constituencies. During its tenure, it was not uncommon for the majority of the council to be out of the country at any given time. Most Iraqis never saw any of the council members. As a group, the GC did not distinguish itself.
The U.S. occupation officials also had a serious legitimacy problem with the international community. Having invaded Iraq without UN Security Council authorization or the support of most other democratic publics in the world, the United States was unable to convince many countries to take a meaningful role in the occupation, something that could have blunted suspicions of the coalition.
Even with that handicap, the UN did establish a fairly significant mission in Baghdad with the arrival on June 2, 2003, of Sergio Vieira de Mello, one of its best, most experienced peace-builders. Despite the UN's questionable reputation in Iraq (a legacy of its involvement with the sanctions program), de Mello and his team were respected by Iraqis and quickly grasped the need for much more substantial Iraqi participation in postwar governance, including the need for the early establishment of an Iraqi interim government.
Unfortunately, the UN's impact on the CPA never extended beyond a few cosmetic changes. This was due in part to the tragic events of August 19, 2003, when terrorists (probably al Qaeda members working with former Baathists) blew up the poorly protected UN headquarters in Baghdad, killing de Mello and more than a dozen other UN staffers and ultimately driving the UN out of Iraq. The attack was one of the worst tragedies the UN has ever suffered as an institution and will shape its thinking about and engagement in conflicts for many years to come.
Even before the attack, however, Washington-and Bremer, in Baghdad-proved unwilling to surrender any significant measure of control to the UN. The CPA leadership did not see a real need for the UN mission, other than to issue an occasional supportive press release. Even when de Mello, after meeting at length with Ayatollah Sistani, went to Bremer in mid-June to warn that a political bomb was about to explode-in the form of a fatwa from Sistani insisting that any constitution-making body for Iraq had to be popularly elected-Bremer dismissed the warning.
The obsession with control was an overarching flaw in the U.S. occupation from start to finish. In any postconflict international intervention, there is always a certain tension between legitimacy and control. Yet for most of the first year of occupation, the U.S. administration opted for the latter whenever the tradeoff presented itself.
That pattern began to change only when the November 15, 2003, "agreement" for political transition quickly unraveled and the administration finally turned to the UN for help. But it should have done so earlier. Washington's legitimacy deficit was so huge that it should have tried, as soon as Garner was replaced in May 2003, to give the UN overall or co-equal responsibility with the CPA for administering postwar Iraq and managing the political transition. It is not clear that the UN would have accepted such a formally elevated role, but at the very least de Mello should have been given much more authority and responsibility.
BUILDING A GOVERNMENT
The Bush administration does deserve credit for adjusting its posture dramatically after the rapid implosion of its plan for a political transition in Iraq. After abandoning Bremer's original approach-which had been to transfer sovereignty to Iraq only after a permanent constitution was written and a new government was democratically elected-Washington issued an ambitious new timetable on November 15 that called for the adoption of an interim constitution (the "Transitional Administrative Law") by February 28, 2004; the indirect election (through a tiered system of caucuses) of a transitional parliament in the spring; and the election by that parliament of a government that would receive sovereignty on June 30. By mid-March 2005, a constituent assembly would be directly elected to write a permanent constitution, which would be submitted to a referendum by August, followed by direct elections for a new government by the end of the year.
This plan was an important improvement over the original, in that it recognized the need to accelerate the transfer of power and to provide a specific date by which it would occur. Much has been made of the choice of June 30, with critics of the Bush administration insisting it was driven by the American electoral calendar. But this criticism never made sense. In Iraq, it was always clear that Washington was being driven by an even more palpable imperative: the need to give Iraqis back their dignity and to empower them to determine their own course.
But June 30 was viewed skeptically by the Iraqi public, much of which was deeply suspicious of everything the United States said and did. And the plan had a more serious problem. From the very start, Ayatollah Sistani denounced it because the transitional parliament it envisaged would not be directly elected. Most Arab Iraqis (Sunni and Shiite) were unhappy with this element and feared that the caucus system proposed for elections would give far too much initial power to groups (such as the GC and the various local and provincial councils) that the CPA had appointed. To be fair, the problem was a complicated one. When it crafted the plan, the CPA had tried to vet it informally with Sistani through an intermediary. But as often happens when one works through intermediaries, the signals became crossed, and the CPA thought that Sistani had consented-perhaps because the ayatollah (a careful scholar) had not been able to study the plan in writing and so did not grasp the features that would later cause him to denounce it.
In the face of Sistani's criticism, the CPA was initially inclined to move forward anyway, on the theory that one man should not be allowed to veto a process. The GC supported the plan (after all, it would have had a significant role in selecting the caucus participants), as did other Iraqi groups working with the CPA. But a political confrontation over the plan started building in Iraq, and it became clear that the United States could not referee a dispute involving itself. Then, in December, Condoleezza Rice, President Bush's national security adviser (who had recently been given overall authority to coordinate policy on Iraq), and her top NSC deputy on Iraq, Robert Blackwill, were advised that it might be possible to persuade the UN to re-engage in Iraq in some kind of mediating or facilitating role. Even better, they heard that Lakhdar Brahimi, an Algerian diplomat who was then completing a successful UN constitution-building mission in Afghanistan, might be recruited to lead this effort. Rice and Blackwill greeted this prospect with genuine enthusiasm and initiated negotiations with the UN. In January, the parties agreed that the UN would return to Iraq in early February, initially in the form of a small mission led by Brahimi.
Although Bremer had initially wanted the UN to play only a limited role, he gradually accepted a broader mandate for Brahimi's mission and ordered the CPA to give the UN its full cooperation. This enabled Brahimi and his advisers (some of whom had gotten to know the new Iraqi political landscape well while working under de Mello) to negotiate a breakthrough compromise by the end of their visit on February 13. Brahimi persuaded Sistani, through patient and methodical discussions, that "reasonably credible elections" simply could not be organized by June 30, and that it would take at least eight months to achieve them once preparations began. This led Sistani to accept the famous compromise, which was affirmed by Security Council Resolution 1546 on June 8. Elections for a transitional parliament (as well as for prime minister and a cabinet) were postponed until December of this year at the earliest or January 31, 2005, at the latest. Meanwhile, the ponderous caucus system for choosing a government was scrapped. And an unelected Iraqi Interim Government with limited powers, created in consultation with the UN mission, was to be given power on June 30 (in fact, the date was June 28).
The selection of the new government by Brahimi, in consultation with the CPA, the GC, and a wide range of other Iraqi constituencies, did not proceed so smoothly. Ambassador Blackwill favored a straightforward handover of transitional power to the GC (with perhaps another 25 members added to make it more inclusive), despite its lack of popularity. Brahimi, who better understood the low esteem in which Iraqis held the GC, favored a truly new government with an outsider as prime minister. The members of the GC wanted to elevate themselves to positions of power and jockeyed intensively for the top jobs. In the end, each side got part of what it wanted. The Bush administration got its choice for prime minister, the most powerful position: Ayad Allawi. And Brahimi largely got the cabinet he wanted, composed of a number of very competent and respected Iraqi ministers, including some existing officials widely considered to have been honest and effective. Significantly, 6 of the 31 cabinet ministers were women. Powerful forces on the GC were not pleased, however. Having demanded the post of prime minister or president in what they viewed as a binational Arab-Kurdish state, the two Kurdish parties had to settle for the posts of deputy premier and deputy president. Dawa and sciri, which had also coveted the top slots, were given the other deputy presidency and the finance ministry, respectively. And two individuals lost out completely: Adnan Pachachi, perhaps the most liberal member of the GC and the one most responsible for the democratic features of the interim constitution; and Ahmed Chalabi, who, in seeking to satisfy many different constituencies and to finesse his once close relationship with the United States, may have finally outwitted even his own brilliant self.
CONSTITUTIONAL CONUNDRUMS
One of Bremer's-and the Bush administration's-highest priorities was to leave Iraq with an interim constitutional framework that would provide a strong, and hopefully enduring, framework for democratic government and the protection of individual rights. The drafting of the Transitional Administrative Law (TAL) was thus a crucial element of the November 15 plan. Pachachi, the chairman of the GC's constitutional drafting committee, shared the liberal values and aspirations of the United States for this document, and so, quite passionately, did the Iraqi and Iraqi-American legal specialists he tapped to do the initial writing. For several weeks, from late December 2003 through early February 2004, they worked, alongside CPA advisers, to craft a document that became much more of a full-blown interim constitution than some (including the UN) thought necessary or appropriate.
Both Iraqis and Americans agreed that the document needed strong and explicit protections for individual rights, and the bill of rights they came up with did not prove controversial. More problematic was how to structure the government, how to divide power between the center and regions (in particular, the Kurdistan regional government), what role to give religion, and what process to endorse for the adoption of the final constitution. These issues brought out the deep political and social cleavages in contemporary Iraq-between Islamists and more secular forces, between Shia and Sunni, and between Iraqi Arabs and Kurds. The drafters produced a document that assured freedom of religion and that nodded toward Islam without basing the state on it. For the time being, this seems an acceptable compromise. Similarly, the formula for a government headed by a prime minister, but with some powers of appointment, supervision, and legislative veto retained by a three-person presidency council, also proved broadly acceptable. Indeed, this was a formula more or less mandated by the GC from the beginning.
One of the toughest sets of issues concerned the vertical division of power and the place of Kurdistan within the Iraqi nation and its political system. Iraqi Kurdish leaders insisted emphatically that their region needed to retain the autonomy it had exercised since the end of the Persian Gulf War. Having suffered terrible oppression and discrimination from the central government in Baghdad, they were determined to protect themselves in the future. Moreover, many Kurds-particularly younger ones, who had reached maturity after 1991 without ever speaking Arabic or identifying with the Iraqi state-favored outright independence, and their leaders worried that if the new system did not preserve their autonomy, these demands might grow. Thus the Kurds pressed for a highly decentralized-almost confederal-system, while also making it clear that they would settle for a preservation of their autonomy and veto rights. To accommodate these demands, the TAL established that all decisions by the Presidency Council (which, presumably, would have one Kurdish member) would have to be unanimous and blessed the continued existence of the regional Kurdistan government, to which it gave greater powers than were granted to the other provincial governments. In the final round-the-clock GC negotiations to complete the document in early March, the Kurds also made a new demand: that any three provinces (and Iraq has three predominantly Kurdish provinces) get the right, by a two-thirds vote in each, to reject the final constitution in a referendum. To prevent a Kurdish walkout, this provision was inserted into the TAL as Article 61c.
Although the constitutional bargain gave the Kurds what they insisted on, it left many Iraqis, especially the Shiites, disaffected. Sistani, for example, raised strong objections, particularly to Article 61c, which he and other Shiites felt would render meaningless the Shiites' power as the demographic majority in the country. This led to a last-minute crisis in which most of the Shiite delegates withdrew from the final negotiations and went to Najaf to consult with Sistani. Although they finally returned and signed the document, giving it unanimous GC consent, they did so only ambiguously, pledging to amend it (particularly Article 61c) later.
At this point, the CPA faced a serious dilemma. The negotiations over the TAL had already stretched beyond the February 28 deadline laid out in the November 15 plan. If the country was going to achieve sovereignty on June 30, this first big step had to be completed so that the process could move on to the remaining work. But by rushing to complete the document without a national debate and the forging of a sustainable consensus, the GC and the CPA covered up deep divisions that quickly boiled to the surface. While happy with a number of the document's features, including those providing for individual rights and an independent judiciary, many Iraqis felt that it granted too many "special rights" to the Kurds and other minorities. Many worried that the document would be a formula for the breakup of the country.
The CPA had long been planning a campaign to sell the TAL to the Iraqi people once it was adopted. A British advertising agency with offices in the Middle East had been hired to produce a campaign of emotional and highly symbolic television and newspaper ads. Yet inexplicably, this campaign did not begin until several weeks after the TAL's signing. This allowed it to be preempted by the appearance of crude leaflets on the streets of Iraq's cities, which denounced the TAL as unfair, unrepresentative, and undemocratic, "a dictatorship of the minorities." These denunciations caught on with the Iraqi public and largely neutralized the CPA's expensive public-relations effort before it ever got off the ground.
I encountered the popular discontent firsthand at public lectures and smaller seminars held in Baghdad, Tikrit, Balad, Basra, Nasariya, and Hilla in March, where I tried to explain the key principles of the TAL and to stimulate discussion. There was plenty of discussion, but almost all of it was critical. Many Iraqis-provincial and local council members, clerics, sheikhs, civic activists, and other opinion leaders-arrived with the leaflet in hand and even quoted from it, as they passionately denounced the document. Repeatedly I was asked, How could such a document be adopted without public debate? Why was one section of the country given so much power? Even when I pointed out some logical inconsistencies in these concerns-for example, that the requirement that all presidency council decisions be unanimous made it much more difficult for the presidency (and hence the Kurds) to veto legislation-people were not much mollified. The anger and frustration were palpable and suggested several things: that Iraqis wanted democracy, though they had a very partial and majoritarian understanding of what it entailed; that Iraqis wanted more voice and participation in government; and that the CPA and the GC were widely distrusted and held in low esteem.
Something should have been done before June 30 to address the widespread grievances with the document, particularly Article 61c, to prevent a major crisis down the road. The lack of broad consensus raised the risk that when the transitional parliament is elected early next year it will disavow the document and amend it at will. I suggested to Bremer and some of my CPA colleagues that we use the instrument of the annex that was to be written to the tal-providing for the structure of the interim government between June 30 and the election of the transitional parliament at the end of this year or early next-to negotiate some amendments. One Shiite political leader with ties to Sistani had proposed that the three-province veto be transferred from the referendum to the deliberations and voting in the transitional parliament, and that the veto be narrowed to cover only issues concerning the rights and powers of provinces and regions within Iraq's federal system. To protect other minority rights, a provision could also have been adopted requiring a special majority (say, three-fifths) for adoption of the constitution by the Transitional National Assembly. This proposal would have guaranteed that Kurdistan could preserve its regional autonomy but would not have enabled the Kurds or any other minority to veto (and thus in the parliamentary negotiations, shape) every aspect of the constitution. I do not know if such a compromise would have been acceptable to Sistani and his followers, but some alternative should have been discussed then, before the election of a transitional parliament made compromise even more difficult. Yet inside the thick walls of Saddam's old presidential palace where the CPA was headquartered, such suggestions fell on deaf ears. Public debate over the interim constitution was abruptly terminated and was soon eclipsed by the outbreak of wider violent insurgencies in April.
CAN IRAQ BECOME A DEMOCRACY?
Although the U.S. occupation and the CPA's effort to design and foster democracy in Iraq were deeply flawed, there were other, more positive aspects of the story, and these offer real hope for the future. Through various offices and mechanisms including the U.S. Agency for International Development and the National Endowment for Democracy, the CPA presided over an ambitious effort to promote pluralist democracy in Iraq. Some financial assistance and technical support was delivered very quickly and sensitively to emerging Iraqi civil society organizations, such as women's groups, youth organizations, professional associations, and think tanks working to expand and stimulate democratic participation. These contributions proved very helpful in some cases, allowing the Iraqi Higher Women's Council, for example, to establish a minimum quota (25 percent) for the representation of women in parliament. Training programs were set up to offer nascent Iraqi political parties the skills and tools needed to organize and mobilize, and energetic and creative CPA officials helped channel this assistance to the right places. The achievements were particularly impressive in Iraq's south-central region, where millions of dollars were spent building a network of 18 Internet-linked local democracy centers (one each for human rights, women, and development in each of six provinces), as well as a regional democracy training center in Hilla that includes a lecture hall, conference room, two state-of-the-art computer rooms, and more than a dozen offices for NGOs. This same assistance helped to build a university for humanistic (and democratic) studies in Hilla, in a gleaming former presidential mosque, complete with a radio station and a vast center for translating works on democracy into Arabic.
Like many CPA officials, I found many Iraqis to have a deep ambition to live in a decent, democratic, and free society and found them prepared to do the hard work that building a democracy will require. Above all else, Iraqis want security: they want to be free from the terror that disfigured their lives under Saddam and that has continued, in a different form, since the war. But most favor achieving this security through democratic means, not under some "benevolent" strongman.
Because of the failures and shortcomings of the occupation-as well as the intrinsic difficulties that any occupation following Saddam's tyranny was bound to confront-it is going to take a number of years to rebuild the Iraqi state and to construct any kind of viable democratic and constitutional order in Iraq. The post-handover transition is going to be long, and initially very bloody. It is not clear that the country is going to be able to conduct reasonably credible elections by next January. And even if those elections are held in a minimally acceptable fashion, it is hard to imagine that the over-ambitious transition timetable for the remainder of 2005 will be kept. Nevertheless, the end of occupation and the transfer of authority to an interim government on June 28 offered at least a chance for a new beginning. And there is no alternative to this transitional program that does not involve one awful scenario or another: civil war, massive renewed repression, the establishment of a safe haven for terrorist organizations-or quite possibly all three.
The transition in Iraq is going to need a huge amount of international assistance-political, economic, and military-for years to come. Hopefully, the U.S. performance will improve now that Iraqis are in charge of their own future. It is going to be costly and it will continue to be frustrating. Yet a large number of courageous Iraqi democrats, many with comfortable alternatives abroad, are betting their lives and their fortunes on the belief that a new and more democratic political order can be developed and sustained in Iraq. The United States owes it to them-and to itself-to continue to help them.
www.foreignaffairs.org is copyright 2002--2004 by the Council on Foreign Relations. All rights reserved.


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>> WASHINGTON

No anthrax found
Malaysian authorities say initial tests on a suspicious powder found in an envelope opened at the U.S. Embassy found no evidence of anthrax.
"Initial tests have not shown any indication of anthrax spores. We are quite sure that it's not anthrax," senior assistant police commissioner Aziz Bulat told Reuters.
The embassy opened the envelope on Monday, but three employees who handled it tested negative for exposure to a toxic substance.
The letter incident was the second this month. The U.S. Embassy in Sri Lanka closed for several days after receiving a similar letter. The powder inside that envelope proved to be harmless.

Disappointed in Syria
The senior Democrat on the House International Relations Committee yesterday expressed his frustration with Syria for failing to cut ties to terrorist groups and withdraw from Lebanon.
"Syria was a major disappointment," said Rep. Tom Lantos, California Democrat, at a press conference at the U.S. Embassy in Jordan, where he met King Abdullah II and Foreign Minister Marwan Moasher.
Mr. Lantos, on a Middle East tour, met on Wednesday with Syrian Foreign Minister Farouk Sharaa in Damascus.
"I emphasized my disappointment and my regret that apparently Syria has not yet decided ... conclusively that it wishes to engage in the global war on terrorism," Mr. Lantos said.
He also urged Syria to withdraw its troops from Lebanon, where they were first deployed in 1976 during the Lebanese civil war.
*Call Embassy Row at 202/636-3297, fax 202/832-7278 or e-mail jmorrison@washingtontimes.com.

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Army report: Apache brownouts caused half of serious accidents
SPECIAL TO WORLD TRIBUNE.COM
Friday, August 13, 2004
A U.S. Army study said power failures, or brownouts, caused 50 percent of serious accidents involving the Apache attack helicopter on combat missions in Iraq.
The study said the brownouts took place during take-offs and landings in Iraq.
An army The AH-64 Apache Apache has been a leading helicopter among Middle East allies of the United States. Egypt, Israel, Kuwait and Saudi Arabia have deployed the Apache and Israel plans to purchase additional aircraft, Middle East Newsline reported.
Commissioned by a congressional committee, the army study said half of the eight accidents termed catastrophic during the war in Iraq were caused by brownouts. The other half stemmed from a failure of the auxiliary power unit clutch.
The report also reviewed the four less serious accidents of the Apaches. Again, three of those accidents were attributed to brownouts.
Seven accidents were reported in the least serious accident category.
The report attributed three accidents to human error, three due to materiel failure and one weapons-related.
The report said the army has launched an effort to prevent power failures during the flight of the Apache. The measures included conducting what the report termed "infrastructure improvements as well as revised procedures and improved risk management in operations involving dust landings or take-offs."
The army was also performing engineering adjustment to the auxiliary power unit clutch failure. At the same time, the army has ordered inspections to detect potential failures.
Copyright + 2004 East West Services, Inc.
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>> NORTH KOREA


Australia envoy in N Korea talks
Mr Downer held talks in Beijing before travelling to Pyongyang
Australia's foreign minister is in North Korea, urging the Stalinist state to renounce nuclear weapons.
Alexander Downer promised Pyongyang "substantial" benefits in aid and trade if it ends its nuclear programme.
North Korea has threatened to boycott the next round of multi-party disarmament talks due to take place in China, blaming a hostile US attitude.
Mr Downer said last week that North Korea was in the process of building missiles capable of reaching Australia.
The minister travelled to Pyongyang after visiting Beijing for talks on how to break the deadlock over North Korea's ambitions to build the bomb.
Little progress
He said China still intended to host working discussions to prepare the ground for top-level talks in late September, even though Pyongyang appeared to rule out sending a delegation.
Australia is not part of the formal six-nation talks on North Korea's nuclear future, but Mr Downer believes it can play a role in trying to solve the impasse.
Months of intermittent multinational talks have produced little progress.
Correspondents say Australia is well-placed to help because it has diplomatic links with North Korea, as well as good relations with China and the US.
The BBC's diplomatic correspondent Jonathan Marcus says the North Koreans may have decided there is little chance of winning concessions from Washington before US elections in November.
Mr Downer promised Pyongyang rewards if it rejoined the process.
The nuclear dispute has been raging for 22 months
"We already have some limited aid programmes in North Korea... and if North Korea were to abandon its nuclear programmes, then obviously that would lead to a very substantial increase in Australia's engagement," he told a news conference in Beijing.
The dispute flared up in October 2002, when US officials accused North Korea of running a secret nuclear programme in violation of international agreements.
Since then, there have been a series of six-party talks between South Korea, China, Japan, Russia, the US and North Korea but a deal has yet to be reached.
North Korea has offered a nuclear freeze in return for economic aid, but says it is not getting the necessary US commitments in return.
The US wants Pyongyang to disclose all its nuclear activities and allow outside monitors into the country.

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>> SEOUL

Seoul bows to Pyongyang's threat, seeks to block defectors
Special to World Tribune.com
EAST-ASIA-INTEL.COM
Wednesday, August 18, 2004
South Korean Foreign Minister Ban Ki-Moon speaks during a press conference at the Foreign Ministry in Seoul.
North Korea has succeeded in frightening South Korean authorities into spreading warnings of a terrorist attack while pleading with non-governmental organizations to stop encouraging North Korean defectors to get to South Korea.
The South Korean government this week opened a double-edged campaign. It began with the National Intelligence Service issuing an extraordinary statement claiming North Korea was ⌠threatening our country with retaliation■ for having accepted 460 North Korean refugees flown from a Southeast Asian nation, identified as Vietnam.
South Korean officials acknowledged, however, there was no definitive evidence of a North Korean plot and bent over backwards to demonstrate that the government did not have a policy of encouraging defectors.
South Korean Foreign Minister Ban Ki-Moon said it was ⌠very troublesome that non-governmental organizations shift responsibility [for the large number of North Korean defectors] when they face difficulties in handling the North Korean defector issue."
Ban appealed for ⌠restraint."
⌠For South Korean NGOs involved in assisting defectors to induce or encourage defection from the North does not coincide with the policies of intra-Korean reconciliation,■ he said.
Ban▓s remarks were a clear reference to the crusading role of some NGOs in urging North Korean defectors to find refuge in diplomatic compounds in China or to try to make their way through China to Vietnam or Hong Kong in hopes of then going to South Korea. A South Korean official said NGOs, in aiding refugees, were blocking North-South talks, which he insisted were ⌠going smoothly.■
The Foreign Ministry said it was urging ⌠heightened vigilance■ after a series of North Korean statements accusing South Korea of having kidnapped the refugees and engaging in human trafficking. The warning was a reminder of the history of terrorism perpetrated by North Korea, including a bombing that killed 17 South Korean officials visiting Myanmar in 1983 and the bombing of a plane over the Indian Ocean with 115 people aboard in 1985.
North Korea, however, has rejected working-level talks for the next round of six-party talks on ending the North▓s nuclear program. A foreign ministry spokesman said the U.S. had ⌠destroyed by itself the foundation for the talks, making it impossible for the DPRK to go to the forthcoming meeting of the working group.■
One reason for the North Korean position is its anger over passage by the U.S. House of Representatives of a bill aimed at promoting human rights in North Korea. The North calls the bill part of an effort to provide ⌠a financial and material guarantee for the overthrow of the system in the DPRK■ and accuses the U.S. of shipping new ⌠war equipment■ to South Korea in preparation for attack.
The North Korean statement also is believed to have been motivated by a need to save face after being embarrassed by the flight of the refugees to South Korea in late July.
Copyright ╘ 2004 East West Services, Inc.

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Escaping North Korea
By Sarah Buckley
BBC News Online
The hundreds of North Korean refugees who have arrived in the South from Vietnam this week will have had a long and frightening journey.
For many, that journey is likely to have started at the Tumen River, which separates North Korea from China.
North Korea's river border is shallow enough to wade across in summer
This narrow waterway can be walked across in winter, when it freezes over, and waded across in summer.
But South Korean activist Kim Sang-hun told BBC News Online that the crossing was very risky.
"It's heavily guarded on both sides," he said. "There are some people who went to the top of a hill nearby and watched the guards for days, and picked the right time."
Others risk bribing the guards with cash, drink or cigarettes.
Once across the river, escaping North Koreans are unlikely to spend much time on the heavily-patrolled border, said Kato Hiroshi, head of a Japanese NGO which helps North Korean refugees.
Instead, they make their way into the mountains, and from there into populated areas to find work. This alone might take five to seven days, depending on the refugee's connections.
They also need to change their clothes to make themselves less visible.
Many initially settle in the three northern provinces of Jilin, Liaoning, and Heilongjiang, where they are sheltered by one of many underground Korean networks in northern China - an area which is highly populated by ethnic Koreans.
Illegal work
They seek work - perhaps in mines, factories or cattle farms - but are often swindled out of their earnings.
A mine owner might promise them 500 yuan a month, but actually they are paid less than half, or nothing at all - forced into acquiescence by the fear of being reported to the authorities.
Those who then choose to leave China - like the 450 or so who arrived in Seoul this week - use their earnings to begin the long dangerous journey across the vast landmass.
For someone who is totally free to travel, it only takes about three days to reach China's southern border by train.
But Mr Kato said long-distance trains were frequently boarded by railway police who check passengers' identity cards, so North Korean refugees usually make shorter train journeys of up to three hours at a time.
Starting again
If they make it to China's southern border, North Korean refugees face another nail-biting crossing.
This is done either under their own steam, with the help of humanitarian aid workers, or through commercial brokers who charge about $2,000-10,000 per person, according to Mr Kim.
Many will fail at this point. According to Mr Kato, China has substantially strengthened its border patrols in a bid to stem the stream of fleeing North Koreans.
Under a treaty with Pyongyang, Beijing is obliged to return them to North Korea.
Those that make it into one of the countries of South East Asia are for the most part looked after by Korean societies, including the Christian church, who give them shelter, food and clothing, said Mr Kato.
"I often meet defectors who say 'I didn't come here because I was hungry. I wanted to live as a human being
Kim Sang-hun
They must then play a waiting game.
Mr Kato said that ideally they should make their way to the UN refugee agency's office to register their refugee status. The UNHCR will then make contact with the South Korean embassy to arrange passage to Seoul.
"They wait their turn - sometimes it takes one year," he said.
But not everyone manages to be so patient, he added.
"In Thailand, in Vietnam, in Cambodia, each government allows to let them stay [without papers], but people can't wait so long, they have already had a very hard time in China," said Mr Kato.
These people will attempt to storm the South Korean embassy, a headline-grabbing incident which Mr Kato said was diplomatically embarrassing for all countries involved.
"They need to transport them silently," he said.
But this face-saving method has become unsustainable in Vietnam.
"Because the number [of North Koreans] has come to be so big, the limit is over to keep silent. Every concerned country cannot close their eyes - there are so many," he said.
Kim Sang-hun estimates that most refugees are sent back at least once
Chinese official media says 8,000 North Koreans cross into China every year - but activists estimate the number at more than 10,000.
The 450 North Koreans who have just arrived in Seoul are the lucky ones. Mr Kim estimates that 70% of refugees fail at some point in their journey.
"Of the defectors who have safely arrived in South Korea, you rarely find refugees who have never been arrested," he said.
Failure can mean incarceration in North Korean prisons or concentration camps, or even execution - sometimes extra-judicially.
But, he said, "a number are released after two to six months because they keep denying [that] while they were in China they were ever in contact with South Koreans."
Many of these will try again to leave the country at a later stage, he added.
Staying close
It is not every North Korean's goal, however, to reach the promised land of the South.
"Many of them would prefer to stay in China," said Mr Kim.
"They are [then] very close to their home country. China is already good enough for them in terms of food and everything, and they hope that their government will collapse soon."
In addition, "if they are in China, they are only officially termed as missing in North Korea, in which case no family or relatives will be punished."
Mr Kim said most refugees were underfed, but that was not what was primarily motivating them.
"I often meet defectors who say 'I didn't come here because I was hungry. I wanted to live as a human being.'"

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China puts Korean spat on the map
By David Scofield
The controversy over whether the ancient, ethnically Korean kingdom of Koguryo was historically Korean or historically part of China simmers, and it divides historians, politicians and patriots on both sides in Northeast Asia. The kingdom stretched well into present-day Manchuria in the north and encompassed most of what is North Korea in the south.
And, to roil the waters, some academics suggest that China's recent cartographic interest in the Koguryo region has a precedent in Beijing's relatively late public claim that Taiwan is and always has been an inalienable part of China. This is not a new claim, but some historians now produce postage stamps, maps and other graphic evidence, as well as speech transcripts and other documents - none of which they say depicts Taiwan as part of China before 1942, meaning that the Chinese Communist Party did not publicly consider it part of the territory.
One historian is Alan M Wachman, associate professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University in Boston, who recently drafted a paper on the Taiwan territorial and sovereignty issue and has made some of his material available to Asia Times Online.
The fact that China did not assert its sovereignty over Taiwan until after the Atlantic Charter in 1941, say some historians, demonstrates that it is quite capable of another volte-face, suddenly deciding that a strategic chunk of Northeast Asia also belonged to the Middle Kingdom. This could have repercussions in the future, if North Korea collapses into anarchy and China intervenes on the basis of its 1961 Treaty of Friendship, Cooperation and Mutual Assistance with North Korea to restore order. Maybe it sets up a new, pro-Beijing government and takes advantage of strategic ports and military bases.
The Chinese Foreign Ministry recently removed the kingdom of Koguryo as one of three Korean kingdoms from its website. It has not commented publicly on the action and its meaning, though the response of Chinese academics has been that the map change is merely part of a major historical project and malign political intentions should not be read into it. China has not made any claims to the territory or called for a boundary change, despite the cartographic revisions of ancient kingdoms. After what it termed "procedural delays", China finally granted visas to South Korean lawmakers who had sought to visit archaeological sites of Koguryo within China.
(Efforts to obtain comment from the Chinese embassies in London and Seoul were not successful. Press officials did not answer the phone in London. The Chinese Embassy in Seoul declined comment and referred inquiries to the the Chinese Ministry of Foreign Affairs website, saying it was supposed to contain an official statement on the issue. A search of the site, however, did not yield information on Koguryo.)
South Korea, previously mute on the subject and on China's sometimes unfriendly behavior, has been taking a somewhat tougher stand. Foreign Minister Ban Ki-moon finally fired back last week on the subject of the historical importance of Gando, which occupies an area that would have been part of the ancient Koguryo kingdom.
Deputy Foreign Minister Lee Soo-hyuck, chief of the government's countermeasures committee handling the Koguryo history issue, said recently, "The urgent focus of our interest as of now is how China will distort [Koguryo history] in its textbooks, and how we should respond should those distortions be carried out; We will strongly demand that textbook distortions not take place, while at the same time responding to this issue academically."
Foreign Minister Ban Ki-moon said on August 11, "The government will firmly tackle any attempts by China to incorporate Koguryo history into the history of China." And for the first time since the problem arose, Ban added, "The Gando problem is a very delicate matter involving many countries, including North Korea."
Many believe that China's recent remapping of its ethnic frontiers - its recent inclusion of the ancient (BCE57-CE668) kingdom of Koguryo into the annals of Chinese, not Korean, history - is nothing more than an isolated attempt by zealous Chinese researchers to make history conform to their beliefs about China's centrality and omnipresence in the greater region, its borders knowing no limits in the minds of these historians. That's a plausible explanation, except for one disturbing fact: there is substantial evidence that the Chinese Communist Party (CCP) has abruptly changed its view of China's territorial borders before, slightly more than 60 years ago to be exact, and the area was Taiwan. This time it's Koguryo, but Taiwan was a precedent.
Many accept China's Taiwan claim
Today, many accept China's claim to Taiwan - a Chinese province, the CCP claims, since time immemorial - without question. But in the first two decades of the CCP's existence (1921-1942) Taiwan was of only passing interest to both the CCP and the former Republic of China (ROC) government. Taiwan was an area defined both visually and rhetorically as beyond the margins of the Han Chinese world. In documents, speeches, maps and even postage stamps, Taiwan and the Taiwanese were characterized as a region and a regional national minority, not a province. Taiwan was only later declared an integral part of China when it was politically expedient to do so.
According to a recent paper by Professor Wachman of Tufts University, the CCP excluded Taiwan from maps, colored Taiwan out of postage stamps and made references to Taiwan only in association with "other Asian peoples who may be rallied in the fight against the Japanese". The ROC's control over Tibet and Outer Mongolia was lost after 1911, yet these areas were still considered part of China proper and were reflected as such in maps and rhetoric - Taiwan was not.
Wachman cites the "Resolution of the CC [Central Committee] on the Current Political Situation and the Party's Tasks" of December 25, 1935, in which the CCP called for a broadening of the party's base and an accommodation with all anti-Japanese forces in a "united front" to prevent the "Japanese imperialists [from] turning China into a colony" and to fight for "China's freedom, independence, and unification." This widespread effort to rally forces against Japan focused on a program of 10 specific tasks, the ninth of which was "to unite the workers and peasants of Korea, Taiwan, and Japan itself and all anti-Japanese forces to form a consolidated alliance".
(From pp 20-21 of Wachman's paper, titled, "Stamped Out! Carto-Philatelic evidence that the CCP's China did not always include Taiwan". The paper was delivered at the University of Sheffield, United Kingdom, at a workshop, "Apolitical? East Asian Postage Stamps as Socio-Political Artifacts". In Wachman's absence, it was delivered by the author of this article, David Scofield.)
Evidence from the time indicates that Taiwan was considered separate, populated by a people defined as non-Chinese, a point graphically illustrated in the CCP's Sixth National Congress in 1928 and again in the party's Outline of the Constitution of the Chinese Soviet Republic in 1931, transcripts of the first and documents of second referring to Taiwan as a "minority nationality separate from the Han Chinese", not a Chinese province as the island has subsequently been designated in oratory emanating from the CCP.
Taiwan was considered beyond the party's immediate interest before the Atlantic Charter of August 14,1941, when United States president Franklin Delano Roosevelt and British prime minister Winston Churchill met in secret off the east coast of Canada, on the USS Augusta, and set out international principles. In effect, they opened the door for a claim by China to Taiwan. Indeed, it was not until that time that the CCP realized it could include Taiwan in its map of China. A volte-face over 60 years ago, forgotten by most outside of a handful of researchers and scholars.
Given this background on Taiwan, the CCP's recent interest in revising history to include the 1,400-year-old Koguryo kingdom, a realm that encompassed most of what is today North Korea in its south and stretched well into Manchuria in its north, becomes potentially far more intriguing and, to some, disturbing. It constitutes an open challenge to North and South Korea and to those who believe China's latest historical re-mapping has little political or security consequences for the Korean Peninsula.
Volte-face on Taiwan could bode ill
That the CCP could for so long and so clearly identify Taiwan as separate from China (this is denied, of course), only to change its attitude so quickly without international challenge or explanation, may not bode well for the long-term independence of the northern half of the Korean Peninsula.
"Taiwan has not always been represented as a part of China, just as Mongolia and the Russian Far East have not always been represented as apart from China," Wachman writes on page 7 of his paper.
But South Korea is starting to react, and given China's history of retroactive territorial inclusion of once-ignored territories, it's wise that Foreign Minister Ban Ki-moon finally retorted last week, officially referring to the territory of Gando for the first time since China made its views on the region known, under the banner of its "Northeastern Project" that it called purely a study of history.
The territory of Gando, literally translated as "middle island", an area between two rivers, is imprecise but is thought to include almost 43,000 square kilometers of Chinese territory, immediately north of present day North Korea, and home to almost a million ethnic Koreans. The land stretches across what is today Jilin and Heilongjiang province. The area was ceded to the Chinese by Japan in 1909, a deal that a unified Korea would have a strong case in overturning, since agreements signed by the Japanese occupiers were negated in the same Atlantic Charter of 1941. That charter and the subsequent Cairo Conference of 1943 made it possible for the Chinese Communist Party's abrupt inclusion of Taiwan in its territory.
South Korean authorities have announced they would be watching China closely, monitoring possible revisions in its school history books for example, though what Korea could do in response is unclear, given the asymmetric relationship between the two nations. South Korea's dependence on China's markets and labor is well documented, a fact that undoubtedly is not lost on the Chinese architects of this latest revision. South Korea has begun pushing back, carefully.
In addition to increasingly vocal condemnations of China's cartography by Our Open Party, government legislators of all stripes and dozens of newspaper articles on China's policy, South Korean authorities have began negotiations with Taiwan to resume direct flights between the capital of Taipei and Seoul. South Korean officials were quick to emphasize that the move was not related to China's latest cartographic moves, though they would certainly know that the aviation talks themselves would anger the Chinese who seek to isolate Taiwan internationally.
Some sort of even higher level acknowledgement of Taiwan though, seems a shrewd maneuver as it guarantees a CCP reaction, thus keeping the primary issue of contention, Koguryo, squarely in the public eye, as the root cause of the dispute. This is vitally important as China's historic modifications may soon be acknowledged as a fait accompli, with calls for redress by the South Koreans swiftly painted as revisionism by the Chinese.
China not officially revising the border
At this time, China is not revising the existing border but carefully establishing what appears to be a broader historical claim to the area. The issue is what would happen if there were a radical political change in North Korea. If there were violence, instability or the collapse of the state, then China could enter the territory under the terms of the 1961 friendship treaty, and if they didn't retain a military presence they might well wish to install a pro-Beijing leadership in Pyongyang. The whole territory of North Korea is very strategic, very close to Japan, but the real issue may be an attempt to preempt any future Korean claim over the Gando region (with records in the 18th and 19th centuries), which covers around 42,000 square kilometers of China, home to around a million Koreans. And what is now North Korea is strategically important because of its ports and bases, providing China with the ability to project its power further in the Asia-Pacific region.
Indeed, interest among China's media in what they see as China's once and possibly future new kingdom is quickly subsiding, according to South Korean diplomats at Seoul's Beijing Embassy, who monitor the Chinese media.
Given this state of affairs, the elevation by South Korea of the Gando/Koguryo issue is exactly what the situation requires. The best defense being a good offense, South Korea would be wise to take a page from North Korea's negotiation play book - put Gando on the table and negotiate hard in the full knowledge that China will never entertain the claim. Nonetheless, the Gando issue could well be used as a bargaining tool to persuade the Chinese to back off of Koguryo. To this end, 18th century cartographic evidence that indicates Gando as Korean territory, like that put forward by Professor Kim Woo-jun of Yonsei University in Seoul, is very useful.
A shrewd strategy might be for South Korea to push its claims for both Koguryo and Gando (Gando was located in the far larger Koguryo area) simultaneously, launch its own own high-level history project and use its place in the world community (the world's 11th largest economy and a growing democracy) to vigorously advocate a redrawing of the northern frontier. In this scenario, South Korea eventually would agree to drop its claim to Gando, in return for China's pledge to respect the ancient kingdom of Koguryo: both sides win, both save face, and both could claim to have preserved historic territory - pride intact.
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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>> MIDDLE EAST


Palestinians have increased use of children to beat Israeli security
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, August 18, 2004
TEL AVIV Palestinian insurgents have increased their use of children for operations against Israel.
Israeli military sources said Palestinian insurgency groups have employed children as young as eight to support insurgency attacks against Israeli targets. They said the youngsters have been asked to smuggle explosives, weapons, or bomb components for such groups as the ruling Fatah movement as well as Hamas and Islamic Jihad.
The use of children by Palestinian insurgency groups has nearly tripled since 2002. The military said that in the first half of 2004, 72 Palestinian minors were arrested at checkpoints on charges of trying to smuggle weapons or components to Palestinian insurgency groups.
In 2001, 27 Palestinian youngsters were arrested at Israeli military checkpoints for insurgency activities, Middle East Newsline reported. The military did not release figures for the arrest of Palestinian minors in 2002 and 2003.
Military sources said the increased use of youngsters was in response to heightened security measures around the West Bank and Gaza Strip. They said Palestinian youngsters will help insurgents for as little as 10 shekels, or more than $2.
Copyright ╘ 2004 East West Services, Inc.

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>> BANDAR DOES RADIO

Saudi adverts avow loyalty to US
By Jeremy Cooke
US correspondent
The film Fahrenheit 9/11 has stoked some distrust of Saudi Arabia
Saudi Arabia has launched a series of radio advertisements in the US aimed at restoring the kingdom's battered public image there.
The announcements stress that Saudi Arabia is a loyal ally in the fight against al-Qaeda.
The Saudis appear to have been stung by heavy criticism in the US press and mass media.
There have been repeated claims that the Saudi government is not fully committed to the fight against terror.
The theme has been taken up, among others, by the Democratic Party's presidential candidate, Senator John Kerry, who has repeatedly questioned the will of the Saudis to take on al-Qaeda.
Commission conclusion
Now, the Saudis are clearly determined to act to restore their damaged image among ordinary Americans.
Saudi officials have launched two radio commercials in 19 key cities across the US, which quote from the US commission that investigated the 11 September attacks.
The broadcasts stress that the commission found there was no evidence that the Saudi government supported or funded al-Qaeda and insist that their country is a strong ally and committed friend of the US.
There is no mention of other comments published in the commission's report, which conclude that Saudi Arabia is a problematic ally in combating Islamic terrorism.
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Myth of Saudi Importance
Joel Mowbray
August 20, 2004
In a bid to dampen rising oil prices, the House of Saud last week promised to pump an additional 1.3 million barrels per day, indefinitely. The markets, though, didn▓t buy what the Saudis were selling≈prices didn▓t drop≈and neither should anyone else.
What should dictate our approach to the Saudis is that they need us to buy their oil just as much as we need them to sell it to us. Not just now, but also in the future.
Yet conventional wisdom among self-appointed foreign policy experts ignores this basic reality, and as a result, Saudi Arabia holds the diplomatic catbird seat, enjoying perks available to few, if any, other nations.
Almost as powerful a factor as black gold is inertia, as this is a relationship that goes back decades. Notes Hudson Institute senior fellow Laurent Murawiec, ⌠This is a relationship that has been cemented by forty years of money, power, and political favors that goes much deeper than most people realize.■
Despite the fact that the United States unflinchingly≈some would say disturbingly≈backs the House of Saud, the favor is not always returned.
During the 1973 oil crisis, American policymakers were convinced that the House of Saud would come to their rescue with an influx of cheap oil. It didn▓t happen. The kingdom went in the other direction, and world oil prices tripled.
Less than two decades later, when Saddam Hussein seemed poised to extend his Kuwaiti offensive into Saudi Arabia, the United States defended its oil-rich friend. When the United States finally saw fit to unseat Saddam last year, however, the Saudis weren▓t willing to give us more than some under-the-table assistance.
In the current context, conspiracy theorists insist that last week▓s pledge was merely the formal enactment of a previously arranged favor to President Bush to lower prices before the election, as first reported by Bob Woodward earlier this year.
A much more reasonable and practical explanation, though, is grounded in simple economics: If the price of oil gets too high, investment dollars will flood research and development efforts behind alternative fuel sources.
And that would be bad news for oil producers everywhere.
The simple truth is that oil is the dominant energy source because it is the cheapest at such a massive scale. But part of the reason no cheaper alternatives exist is that there hasn▓t been enough of a financial incentive to date for private capital to expend the requisite funding to find one.
For all the greenies who blame government interference or lack of taxpayer support for the relative dearth of green-friendly energy sources, limited government funds could never fuel the necessary technological innovation. Private capital markets, however, have far more on hand to fund comprehensive≈and expensive≈research.
There just needs to be an incentive to open the floodgates≈and soaring oil prices might be the best one.
No one understands this better than the Saudis. Thus while they obviously would like sky-high oil prices, the reality is that long-term considerations place the ceiling substantially lower.
So if the Saudis face market pressures that force them to keep oil prices in check, why does the U.S. State Department go to tragic-comic lengths to keep them happy?
For all the talk about President Bush▓s ties to the House of Saud, it is the State Department that grants the everyday favor that collectively constitute a record of humiliating obsequiousness.
State ignores the rash of Saudi fathers who have kidnapped American children from American mothers, holding them hostage in the desert prison.
Even when an American mother is with her two children on U.S. soil at the U.S. Embassy in Riyadh≈as 24-year-old Sarah Saga was last year≈State fights Americans▓ interests and sides with the Saudis.
Religious freedoms of Christians and Shi▓ite Muslims≈the majority population of the oil-rich Eastern Province≈are routinely and often brutally suppressed, yet State sees no evil.
Some of State▓s pandering, though, has far graver consequences.
In late 2001, after State discovered that 15 of the 19 9/11 hijackers were Saudis≈and that all of them had submitted applications that never should have been approved under the law≈it sent out a press release saying that the U.S. had ⌠not changed its procedures or policies in determining visa eligibility as a result of the terrorist attacks of Sept. 11, 2001.■
Sadly, State was telling the truth. And to this day, that pledge still largely holds true.
Which means that the current trading situation boils down to the following: they export oil, and we import terrorists. What a deal.
╘2004 Joel Mowbray



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Pentagon, State Dept. differ on threat to Americans in Bahrain
SPECIAL TO WORLD TRIBUNE.COM
Monday, August 16, 2004
The State Department has allowed U.S. embassy staffers to return to Bahrain, but the Defense Department has refrained from issuing such a decision.
The State Department said it terminated its travel warning to Bahrain after a review of the security situation. The move came nearly six weeks after the evacuation of American dependents from the Gulf Cooperation Council state in July.
For its part, the Pentagon said it would not authorize the return of dependents of its staffers or those from the Fifth Fleet in Bahrain. About 3,000 sailors and other naval personnel have been based with the Fifth Fleet in Manama.
Fifth Fleet spokesman Lt. William Speaks said the evacuation of dependents of military personnel was based on threats beyond Bahrain. Speaks said the regional threat was still deemed valid, Middle East Newsline reported.
Howeer, a U.S. Defense Department school for the children of dependents of American military personnel in Bahrain will reopen for the forthcoming school year.
Organizers said the Pentagon-sponsored Bahrain School will reopen for classes on Aug. 31 despite the departure of 350 students and 80 teachers from the kingdom. The students and teachers were included in the evacuation of more than 1,000 dependents of U.S. defense and military personnel from Bahrain in July.
"The decision to open the Bahrain School has been taken at the very highest levels of government in both Bahrain and the United States and reinforces the historic special relationship between the two countries," Dhafer Al Umran, a board member of the Bahrain International School Association, said.
"The decision resulted from a careful and thorough review of the existing security situation in Bahrain and the potential for future attacks on U.S. interests and facilities in the area," a State Department statement said on Aug. 12. "The embassy has determined that there are currently no specific threats to U.S. mission personnel in Bahrain."
In July, about 1,000 dependents of U.S. military and other staffers were evacuated from Bahrain in wake of an alert of an Al Qaida-related attack.
The evacuation also included non-essential personnel from the U.S. embassy in Manama and their dependents.
State Department deputy spokesman Adam Ereli said the decision to return embassy staffers to Manama was based on its arrest of six suspected Islamic insurgents as well as security measures taken by the kingdom and U.S. authorities.
"I would say our decision to end authorized departure, or lift authorized departure status, is based on a variety of considerations, including steps we've been able to take to protect ourselves, as well as counterterrorism cooperation and other steps host government has been able to take," Ereli said.
The State Department also reported the return of non-essential embassy staffers to Saudi Arabia. But the department said families of U.S. diplomats would not be included.
"The original decision to relocate family members and non-essential staff was not based on the travel advisory or security situation in Bahrain alone," Speaks said. "It was based on the entire region. The travel advisory for this area at large is still in effect. So at this point no decision has been made by the department to change the status."
On July 14, Bahrain detained six people accused of being part of an Al Qaida plot against targets in the kingdom. Bahrain has also bolstered security around key ports.
"It is important for everyone to understand that [the relocation of family members and non-essential staff] was not based on one travel advisory for Bahrain or certain individuals being detained," Speaks told the Manama-based Gulf Daily News. "It was based on a pool of information."
Copyright ? 2004 East West Services, Inc.

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>> BUSINESS

Bush's House of Cards
by DEAN BAKER
http://www.thenation.com/doc.mhtml?i=20040816&s=baker
[posted online on August 9, 2004]
The latest data on growth suggest that the economy may again be faltering, just when President Bush desperately needs good numbers to make the case for his re-election. As bad as the Bush economic record is, it would be far worse if not for the growth of an unsustainable housing bubble through the three and a half years of the Bush Administration.
The housing market has supported the economy both directly--through construction of new homes and purchases of existing homes--and indirectly, by allowing families to borrow against the increased value of their homes. Housing construction is up more than 17 percent from its level at the end of the recession. Purchases of existing homes hit a record of 6.1 million in 2003, more than 500,000 above the previous record set in 2002. Each home purchase is accompanied by thousands of dollars of closing costs, plus thousands more spent on furniture and remodeling.
The indirect impact of the housing bubble is at least as important. Mortgage debt rose by an incredible $2.3 trillion between 2000 and 2003. This borrowing has sustained consumption growth in an environment in which firms have been shedding jobs and cutting back hours, and real wage growth has fallen to zero, although the gains from this elixir are starting to fade with a recent rise in mortgage rates and many families are running out of equity to tap.
The red-hot housing market has forced up home prices nationwide by 35 percent after adjusting for inflation. There is no precedent for this sort of increase in home prices. Historically, home prices have moved at roughly the same pace as the overall rate of inflation. While the bubble has not affected every housing market--in large parts of the country home prices have remained pretty much even with inflation--in the bubble areas, primarily on the two coasts, home prices have exceeded the overall rate of inflation by 60 percentage points or more.
The housing enthusiasts, led by Alan Greenspan, insist that the run-up is not a bubble, but rather reflects fundamental factors in the demand for housing. They cite several factors that could explain the price surge: a limited supply of urban land, immigration increasing the demand for housing, environmental restrictions on building, and rising family income leading to increased demand for housing.
A quick examination shows that none of these explanations holds water. Land is always in limited supply; that fact never led to such a widespread run-up in home prices in the past. Immigration didn't just begin in the late nineties. Also, most recent immigrants are low-wage workers. They are not in the market for the $500,000 homes that middle-class families now occupy in bubble-inflated markets. Furthermore, the demographic impact of recent immigration rates pales compared to the impact of baby boomers first forming their first households in the late seventies and eighties. And that did not lead to a comparable boom in home prices.
Environmental restrictions on building, moreover, didn't begin in the late nineties. In fact, in light of the election of the Gingrich Congress in 1994 and subsequent Republican dominance of many state houses, it's unlikely that these restrictions suddenly became more severe at the end of the decade. And the income growth at the end of the nineties, while healthy, was only mediocre compared to the growth seen over the period from 1951 to 1973. In any event, this income growth has petered out in the last two years.
The final blow to the argument of the housing enthusiasts is the recent trend in rents. Rental prices did originally follow sale prices upward, although not nearly as fast. However, in the last two years, the pace of rental price increases has slowed under the pressure of record high vacancy rates. In some bubble areas, like Seattle and San Francisco, rents are actually falling. No one can produce an explanation as to how fundamental factors can lead to a run-up in home sale prices, but not rents.
At the end of the day, housing can be viewed like Internet stocks on the NASDAQ. A run-up in prices eventually attracts more supply. This takes the form of IPOs on the NASDAQ, and new homes in the housing market. Eventually, there are not enough people to sustain demand, and prices plunge.
The crash of the housing market will not be pretty. It is virtually certain to lead to a second dip to the recession. Even worse, millions of families will see the bulk of their savings disappear as homes in some of the bubble areas lose 30 percent, or more, of their value. Foreclosures, which are already at near record highs, will almost certainly soar to new peaks. This has happened before in regional markets that had severe housing bubbles, most notably in Colorado and Texas after the collapse of oil prices in the early eighties. However, this time the bubble markets are more the rule than the exception, infecting most of real estate markets on both coasts, as well as many local markets in the center of the country.
In this context, it's especially disturbing that the Bush administration has announced that it is cutting back Section 8 housing vouchers, which provide rental assistance to low income families, while easing restrictions on mortgage loans. Low-income families will now be able to get subsidized mortgage loans through the Federal Housing Administration that are equal to 103 percent of the purchase price of a home. Home ownership can sometimes be a ticket to the middle class, but buying homes at bubble-inflated prices may saddle hundreds of thousands of poor families with an unmanageable debt burden.
As with the stock bubble, the big question in the housing bubble is when it will burst. No one can give a definitive answer to that one, but Alan Greenspan seems determined to ensure that it will be after November. Instead of warning prospective homebuyers of the risk of buying housing in a bubble-inflated market, Greenspan gave Congressional testimony in the summer of 2002 arguing that there is no such bubble. This is comparable to his issuing a "buy" recommendation for the NASDAQ at the beginning of 1999. More recently, Greenspan has done everything in his power to keep mortgage rates as low as possible, at one point even offering markets the hope that the Fed would take the extraordinary measure of directly buying long-term Treasury bonds. The man who testified that the Bush tax cuts were a good idea apparently has one last job to perform for the President.
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'No one knows what the hell is going on'
Nortel's numbers causing havoc
Theresa Tedesco
National Post
August 20, 2004
CREDIT: Erik Lesser, Getty Images
Nortel Networks is trying to right itself amid investigations into its financial reporting, but new trouble could be ahead.
Not even the expensive public relations consultants who flew in from New York could spin a good tale for Nortel Networks Corp.
The Brampton, Ont.-based company finally released financial numbers to investors yesterday, albeit unaudited ones with a caveat: Nortel cautioned they could be revised. But rather than provide a balm to besieged employees and worried investors, the cautious message merely underscored that whatever ails North America's largest telecommunications equipment maker is not just a thing of the past.
"It's a publicly traded company, and we still don't have any numbers from them. No one knows what the hell is going on," said Karim Jamal, the Alexander Hamilton Professor at the University of Alberta. "They keep making vague disclosures and all they've created is a cloud of uncertainty over the company."
To wit, Nortel's long-awaited restatement for the first six months of this year revealed the company is barely profitable. Not only that, 3,500 jobs -- 10% of its workforce -- are going to be slashed by the end of the year, the consequence of a restructuring the company hopes will save up to $500-million a year.
Most of these positions are expected to come from Nortel's North American management ranks.
At the same time, William Owens, the newly minted chief executive of Nortel, revealed that three more executives have been fired "for cause" in connection with an internal accounting scandal that Mr. Owens will only say is expected to result in a major restatement of Nortel's financial statements dating back to 2000.
In all, 10 senior executives, including Frank Dunn, former chief executive of Nortel, have received pink slips since April because they were responsible for the company's financial reporting, which is now being scrutinized by a special audit committee of Nortel directors.
At the same time, two law enforcement agencies and two securities regulators in Canada and the United States have launched criminal and regulatory investigations. Even the Institute of Chartered Accountants of Ontario, the profession's governing body, is looking into the role of Deloitte & Touche LLP in Nortel's increasingly messy affair.
For now, Nortel has not publicly charged its former executives with any wrongdoing, although Mr. Owens said the company is demanding they pay back $10-million in bonuses they received last year from the company's controversial executive bonus plan. To that end, letters were dispatched yesterday.
According to Mr. Owens, no more details will be publicly disclosed until the end of September. That is when the retired U.S. military commander, who has been parachuted into the corner office to clean up the alleged mess of the past regime, figures Nortel can come clean about the "improper application of generally accepted accounting principles" that were used to book accruals and provisions the company claims were "misstated" in its filings.
"My sense is that they are building a defence and until they do, they'll keep pushing the accounting story without producing any numbers to back it up," Prof. Jamal said yesterday.
Ross Healy, an analyst at Strategic Analysis Corp., says the mandate of Nortel's special audit committee, led by John Cleghorn, former chief executive of Royal Bank of Canada, is ostensibly to solve the questionable accounting issues and provide new financial statements. At the same time, he said, "the sub rosa mandate is to have enough to hang Frank Dunn and the others and make sure the company comes out looking good."
Mr. Healy called that exercise a "high-wire act." The directors leading Nortel's internal audit -- Mr. Cleghorn and Lynton Wilson -- are highly regarded and respected, and not likely to act out of spite or malice. Yet for many, it is inconceivable that Mr. Dunn, who toiled at Nortel for 28 years, would have put himself on the firing line for $2-million when he stood to earn 10 times more if he had just stuck around the corner office. He was already earning US$800,000 a year in salary, plus stock options, bonuses, and a handsome pension.
"There would have been no incentive for Frank Dunn to have done anything that was self-serving and wilfully illegal," said an official familiar with events who asked not to be named. "It's going to be really interesting to see how they handle it."
In the meantime, Mr. Owens said costs associated with cleaning up the accounting were "not insignificant." Accordingly, 650 of the company's finance employees have worked exclusively on the restatements. The company is running up a tab with the dozens of lawyers, risk management consultants and a small army from Deloittes that have been retained to fend off the four investigations and a class-action lawsuit filed by Nortel shareholders. That kind of backup has a hefty price tag in the millions of dollars, but Mr. Owens would only say it will cost each shareholder less than a cent per share for each quarter.
"We're well on our way to putting our financial issues behind us," Mr. Owens said during a conference call with analysts, adding once the restatements have been issued, the costs will come down.
That is not likely. "Those who have been fired are waiting for Nortel to play its hand," Prof. Jamal said . "You can expect the wrongful dismissal lawsuits to start flying right after that."
Calls to Mr. Dunn and his lawyer, Thomas Heintzman, were not returned.
For Nortel, defending against the lawsuits will be an added expense; so will launching its own legal action to recover the $10-million in bonuses.
Thus, even when the telecom giant finally comes clean about its financial health and lays out the case against its former employees, the uncertainty that plagues the company is not likely to dissipate anytime soon.

? National Post 2004

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Pension funds urged to end ties to terror
By Jeffrey Sparshott
THE WASHINGTON TIMES
Public pension funds, which manage multibillion-dollar retirement accounts for teachers, police officers, firefighters and other civil servants, are coming under increasing pressure to divest from companies with ties to state sponsors of terrorism.
Lawmakers at federal and local levels have pressured U.S. companies and pension funds to more carefully explain and document their relationships with countries such as Syria and Iran. The effort is intended to pressure companies to choose between American investors and legal business opportunities in rogue states.
"It is ... unconscionable for our country's public-pension systems to permit investment in companies that provide revenues, advanced equipment and technology to countries that threaten our vital security interests," Sen. Frank R. Lautenberg, New Jersey Democrat, said in an Aug. 5 letter to state pension-fund managers..
The top pension systems in the United States have invested an estimated $188 billion in companies with legal projects in or sales to countries such as Iran, Libya, Sudan, Syria, North Korea, and Saddam Hussein-era Iraq, the Center for Security Policy said last week in a report meant to quantify the investments.
The U.S. State Department considers those countries, as well as Cuba, state sponsors of terrorism.
"Americans do not want to invest in terror, directly or indirectly. Regrettably, that is what is being done on a massive scale today," said the center, a nonprofit think tank in Washington.
The Virginia Retirement System, for example, holds almost $4.9 billion in investments in 213 companies with ties to terrorist-sponsoring states.
The state's retirement system was worth $39.1 billion at the end of the fiscal year on June 30, with a one-year return of 17 percent. The S&P 500 over the period also rose by 17 percent.
The fund invested in companies that are major, publicly traded multinationals common in index funds purchased by institutional investors. They include French telecommunications equipment supplier Alcatel, French Bank BNP Paribas, French energy company Total, Italian energy company ENI and South Korean manufacturer Hyundai Heavy Industries.
The Maryland State Retirement and Pension Systems invests in 89 companies with ties to terrorist-sponsoring states, and the District of Columbia Retirement Board invests in 77 companies with such ties, the center said.
The companies include German telecommunications firm Siemens, Norwegian energy giant Statoil and Swiss bank UBS.
The Maryland systems held $30 billion in assets as of June 30. Overall equity returns for the year were 23.1 percent, the Maryland Retirement and Pension Agency said.
The District's fund was valued at $2.23 billion at the close of fiscal 2003 on Sept. 30, with a one-year return of 16.3 percent, according to the retirement board's Web site.
Different pension funds take different tacks on the issue, although few aggressively review investments for ties to terrorism.
"The [Virginia Retirement System] is not in a position of being able to evaluate who is aiding terrorism and who is not. The retirement system is not a foreign-policy expert -- we look to the federal government to provide guidance to that effect," said Jeanne Chenault, the system's public-relations director.
Neither the Maryland nor the D.C. systems returned calls.
Corporate activities in the rogue states are wide-ranging. Alcatel, for example, has operated in Iran, Libya, Sudan and Saddam Hussein-era Iraq, the center said. Alcatel reportedly has signed contracts with state-controlled Iranian companies to provide data transmission and switching network capabilities, including personnel training.
Many pension funds maintain they are operating within the bounds of U.S. law and that a company's links to a country do not mean that the U.S. government thinks that firm is supporting terrorism.
The National Association of State Retirement Administrators, which represents public-retirement-system executives, wrote Securities and Exchange Commission (SEC) Chairman William Donaldson in May complaining that negative press reports are "based upon the false premise that institutional investors are unknowingly 'supporting' terrorist activities."
"These reports are often not only unwarranted, but unfair as institutional investors have no way to determine which companies or their subsidiaries are, in fact, doing business in countries considered by the federal government to be supporting terrorism," it said.
The association asked the SEC's new Global Security Risk office to assist investors with information that will help them determine whether a company's activity supports terrorism. But the office, which still is being staffed, is unlikely to provide the guidance that some funds are seeking.
"It would be inappropriate for us to publish a list of companies whose securities might be deemed to involve terrorism-related investment risk without publishing corresponding lists for every other possible type of investment risk," Shelley E. Parratt, SEC deputy director, said in a July 28 letter to Pennsylvania's state retirement system.
Not all pension funds are waiting for federal action. New York City's fire and police pension funds have taken the lead in using their investments to pressure companies to reconsider their associations.
New York City Comptroller William C. Thompson Jr., who oversees city pension fund investments, last year asked for a review of three U.S. companies with subsidiaries that have potential ties to terrorist-linked countries -- Halliburton, General Electric and ConocoPhillips.
Sen. Charles E. Grassley, Iowa Republican, and Sen. Max Baucus, Montana Democrat, earlier this year wrote to the companies, demanding an explanation of their ties to Iran and Syria. A spokeswoman for Mr. Grassley said this week that the legislators are talking with the companies and reviewing the information that has been provided.
Mr. Lautenberg, this year, introduced an amendment to a broader corporate-tax bill that would have blocked subsidiaries of U.S. companies from operating in terrorism-sponsoring nations. The measure failed.
The New Jersey lawmaker turned to pension funds to pursue the matter. In the Aug. 5 letter, he asked state pension-fund managers to provide details of investments in companies with ties to state sponsors of terrorism.
The center's report, posted on the Internet at DivestTerror.org, examines investments by 87 of the country's largest pension funds in 400 companies -- including about 30 U.S. companies -- with projects or investments in states that sponsor terrorism.
The report named only a dozen European companies. D.C.-based Conflict Securities Advisory Group generated the list of firms and maintains it as proprietary information. The firm would profit if more pension funds purchased its database and software to ferret out companies with ties to state sponsors of terrorism.
The Center for Security Policy's board of directors includes persons tied to or involved with U.S. defense contractors, such as Boeing.

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>> ENERGY


Gulf state offers bid for Russia's Lukos oil firm
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, August 11, 2004
MOSCOW ^~ The United Arab Emirates has staged a quiet campaign to buy Russia's leading energy firm.
Russian industry sources and media said UAE Defense Minister Mohammed Bin Rashid Al Maktoum was said to have offered up to $12 billion to purchase Russia's Lukas. They said Al Maktoum, who is also Dubai's crown prince, was prepared to pay off the estimated $3.4 billion in taxes owed by Yukos and purchase a majority stake in the company, which has interests in Iraq and Saudi Arabia.
Al Maktoum was believed to be the silent partner of Konstantin Kagalovsky, a former associate of Mikhail Khodorkovsky, Yukos's largest shareholder. But Kagalovsky would not confirm a report by the London-based Sunday Times on Aug. 8 that Al Maktoum was the silent partner.
"I cannot name the members of the consortium," Kagalovsky told the Moscow-based Kommersant newspaper. "But I can confirm that investors from Persian Gulf countries plan to offer more than half of the required funds. The exact amount is not known, given that the tax payment demanded from Yukos has not been determined."
The UAE has the largest amount of foreign assets by an Arab League state and increased holdings by $10 billion over the last year, Middle East Newsline reported, citing a government report.

Copyright + 2004 East West Services, Inc.

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Price of Gasoline in Russia Overtakes That of US
By Sergei Blagov
CNSNews.com Correspondent
August 20, 2004
Moscow (CNSNews.com) - As record-breaking world oil prices continue to boost the cost of gasoline, motorists in Russia are now paying more at the pumps than their American counterparts.
This month, the average price for a liter of A-92, or standard, gas in Russia has reached an all-time high of 13.82 rubles (48 cents) per liter ($2.18 a gallon), according to the Moscow Fuel Association.
By comparison, gas in the United States has ranged between $1.86 and $2.04 a gallon, according to the U.S. Department of Energy.
Russia's retail gas price has risen roughly 20 percent since the beginning of this year.
For Russian drivers, price hikes are a matter of particular concern because average incomes here are estimated at about one-tenth of those in the U.S.
Some market analysts warned that if the current trend continues, gas prices in Russia could more than double by next summer and reach the levels faced by motorists in Europe, who pay more than $5 a gallon.
Russian Economic Development and Trade Minister German Gref conceded Thursday that gas prices had been rising faster than the government had anticipated.
The country's consumer price index had risen in the first half of August mainly due to the increase in gas prices, he said.
Gref suggested an additional rise of export tariffs on petroleum products from early September in a bid to bring down domestic fuel prices.
At the beginning of August, Moscow increased export tariffs on oil products from $37.50 to $45.40 per ton.
Growing exports limit Russia's domestic oil and oil products supply, pushing up domestic gas prices. According to some expert estimates, it is now twice as profitable to export Russian oil as to sell it domestically.
Skyrocketing world crude oil prices and the traditional end-of-summer peak are seen as the main reasons for the rise. Russia's gas prices traditionally jump in August and September, when the climax of the farming season coincides with the year's heaviest driving.

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Western energy firms alarmed by Saudi deals with China, Russia
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, August 11, 2004
ABU DHABI ^~ Western defense and energy majors plan to continue to operate in Saudi Arabia despite the Al Qaida insurgency campaign in the kingdom.
The United States has been the largest beneficiary of the Saudi effort to improve security. U.S. diplomats and industry sources said the FBI and CIA have established a joint counter-insurgency command and control center with Saudi security and intelligence personnel to monitor Al Qaida and respond to threats.
The enhanced Saudi cooperation was launched to stem the exodus of Americans from the kingdom over the last three months. Industry sources said the exodus resulted in the departure of small U.S. companies and consultants and threatened to deplete manpower levels at U.S. defense and energy majors.
As a result, Saudi Arabia has sought to ease its dependence on Western companies. In May, the Saudi Oil Ministry, in an unprecedented move, chose oil majors from China and Russia for a multi-billion dollar program to explore and develop natural gas reserves in the Eastern Province. Russia has also offered to provide Saudi Arabia with a range of military platforms, weapons and other services, Middle East Newsline reported.
The Saudi agreements with China and Russia were said to have alarmed Western majors. Industry sources said the record oil-based revenues flowing into the kingdom were expected to revive defense, energy and infrastructure projects in a move that could result in a windfall for Western investors.
Saudi and industry sources said Western defense and oil companies have reaffirmed their intention to remain in the kingdom and complete their projects. At the same time, the sources said, Western majors have sought to operate with fewer British and U.S. personnel and establish a support network in neighboring Bahrain.
"The challenge is serious, but a withdrawal is not on the table for those companies," Saudi economist Ihsan Bu Hulaiga said. "It might be an option for some Western individuals but not companies."
The determination to remain in Saudi Arabia has comprised British, French and U.S. companies and was the result of a series of meetings with Saudi security officials over the last two months, the sources said. They said Western majors have concluded that Riyad would increase efforts to protect their presence in the kingdom.
The sources said Saudi authorities have approved gun licenses for foreign security guards to protect leading defense and energy executives. They said foreign security personnel have been allowed to carry guns in missions to protect Western embassy employees and selected dependents.
"We want to thank the Foreign Affairs and Interior Ministries for providing security to French expatriates and other residents across the kingdom," French consul-general Jean Wiet said in Jedda.
Wiet, speaking at an appearance last month, did not elaborate. About 1,600 French nationals were reported to be in Saudi Arabia.
Since 1999, Westerners comprised half of the $12.5 billion invested in Saudi Arabia, the Saudi Arabian General Investment Authority reported. Industry sources said Saudi Arabia expects Western investment to increase over the next year.
"I believe such [Al Qaida] attacks have created an adverse psychological impact on investors who want to invest here for the first time but not to the extent that well established companies in the kingdom have decided to leave," Saeed Al Shaikh, chief economist at the Saudi National Commercial Bank, told the Abu Dhabi-based Gulf News. "There are fears among potential investors and this explains the fact that the foreign capital flow into Saudi Arabia has been below expectations."
The industry sources said the greatest challenge for Western majors would be to retain their Australian, British and U.S. employees in Saudi Arabia. BAe Systems, for example, has offered a $1,600 per month bonus for its 2,400 Western staffers to remain in their jobs.
"Saudi Arabia is in desperate need of investment, this includes foreign direct investment, and the bringing home of hundreds of billions of Saudi money invested outside the kingdom," Rachel Bronson, director of Middle East studies at the Council of Foreign Relations, said. "An exodus by the expats will be a clear signal that its not safe to invest in Saudi Arabia. The Crown Prince's reform agenda will go out the window, and Saudi Arabia's economic situation will further spiral."
Copyright + 2004 East West Services, Inc.
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>> EUROPE


http://news.ft.com/cms/s/45ad933e-f246-11d8-861d-00000e2511c8.html
Barroso's team
Published: August 20 2004 05:00 | Last updated: August 20 2004 05:00
The 25 members of the next European Commission may not be in office yet - they do not take over until November - but already they are the main focus of political attention in Brussels. Jos? Manuel Barroso, the president-designate, has earned much favourable comment for his calm competence and good presentation skills since he emerged from the messy selection process in June as the man to succeed Romano Prodi. His allocation of portfolios last week was praised for its speed, careful balance, and success in resisting national lobbying. But the real challenge is going to be turning 25 profoundly political individuals into a coherent team.
The process begins in Brussels today, when they meet for the first time. It will not be an easy task. Unlike any national government, they represent a broad spectrum of political opinions from left to right and from environmentalist greens to free marketeers. Mr Barroso did not have much influence on the names submitted by national governments. He cannot appeal to party political loyalty. He must persuade them, instead, that the institution itself is paramount: national interests must be left behind and the coherence and effectiveness of the European Commission should be their primary goal. It is asking an awful lot of politicians who have spent their entire lives in the cut-and-thrust of national government and opposition.
The Commission is central to the effective functioning of the European Union. But it has to share its executive power with the 25 member states. It has to perform a tricky balancing act in which its competence and powers of persuasion are the key to respect. The outgoing Commission under Mr Prodi had a mixed track record. Several individuals had respect but the team as a whole never quite got its act together. The previous Commission headed by Jacques Santer was forced to resign after a vote of no confidence in the European parliament. So the new team has a lot of ground to make up.
Already Mr Barroso has shown he is pragmatic and not over-ambitious. He sees the Commission first as an honest broker, suggesting ways to reconcile the interests of member states. He needs to focus on a few critical issues rather than try to do too much. Giving new impetus to the Lisbon agenda - to boost European competitiveness - is certainly one. Negotiating agreement on the long-term EU budget - the so-called financial perspectives - is another. Reaching a successful conclusion to the Doha round of world trade liberalisation is a third. And managing current and future EU enlargement - maybe including Turkey - is another.
None of those will be easy. They will require clear thinking and firm leadership from the Commission, and a determination to resist excessive national pleading from the member states, be they big or small. Modesty and competence should be the bywords of the new Commission. That, in turn, should earn respect.

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Benoit's Gall
Shortly after Bulgarian truck driver Georgi Lazov's headless body was fished out of the Tigris River on July 14, his country's NATO ambassador in Brussels, Emil Valev, proposed that the organization issue a statement condemning this and other hostage-takings in Iraq. NATO Secretary General Jaap de Hoop Scheffer did end up releasing such a statement, on July 20, calling these incidents "abhorrent" and "revolting," and expressing "deepest sympathy" for the various victims' families.
But he did so, THE SCRAPBOOK has learned, only over the initial objections of Benoit d'Aboville, France's NATO envoy. Monsieur d'Aboville, one well-placed diplomat reports, dismissed his Bulgarian colleague's request for an expression of support as ridiculous, arguing that all countries must learn to deal with hostage-takers as a matter of course, paying them off as necessary. Here, presumably, d'Aboville was communicating only his personal views and not the formal policy of France. At least we hope so.
This same Benoit d'Aboville has since been the subject of a most revealing and excellent profile by reporter Philip Shishkin in the August 2 Wall Street Journal. According to Shishkin, "fellow diplomats call [d'Aboville] the most outspoken and unpredictable ambassador NATO has seen in years," a man "notorious for losing his composure at meetings."
At one such session, for example, d'Aboville first "stormed out" of the room, by itself "an almost unheard-of breach of etiquette," and then actually managed to make things worse by returning to his seat, where he "unfurled a French newspaper, interrupting his reading only to quote ...


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Russia unfazed by US plan
By Sergei Blagov
MOSCOW - Following President George W Bush's troop shift announcement in the US this week, it was expected that Russia's encirclement fears would revive, given that US forces are to be moved closer to the Middle East and Central Asia. But although the Kremlin's official reaction was relatively calm, it's push for Central Asian influence continues.
"I do not see anything worrying in these plans," Russian Defense Minister Sergei Ivanov stated, adding, "No grandiose movements are expected."
Although the plan involves US withdrawal of 70,000 troops from Europe and Asia and major shifts would not begin before 2006, some of the troops from Germany and South Korea reportedly could be moved to North Atlantic Treaty Organization (NATO) expansion countries in Eastern Europe and possibly in Uzbekistan. Notably, Romania has air bases within striking distance of Iraq and Central Asia. Russia has previously expressed unease over the US making inroads into Central Asia.
But Washington has been careful not to antagonize Moscow. At the Defense Department background briefing on Monday, it was stated that the realignment was not aimed at Russia. The US would make greater use of training and logistics bases on the soil of new allies like Uzbekistan and Romania, said Pentagon officials who briefed reporters on condition of anonymity.
A senior military official went on to say that the kind of cooperation that develops further with Uzbekistan and others in Central Asia depended on those countries and to what extent they wanted to work with the US. "But we're not looking to take forces that are otherwise in Europe today and station them either in Eastern Europe or in Central Asia. That's not part of our plan," the official said.
Regardless, Moscow rarely lets its guard down. Not enemies, but not yet allies was how Ivanov characterized relations between Russia and the US following two days of talks over the weekend in St Petersburg with US Defense Secretary Donald Rumsfeld. Ivanov described his attitude toward NATO's eastward enlargement as "calmly negative", and criticized NATO's expansion into three former Soviet states on the Baltic Sea and warned that NATO warplanes flying patrols over those countries create the risk of accidental incidents.
The patrols are flown by four NATO fighter jets because the Baltic states of Latvia, Lithuania and Estonia have no air forces of their own. Ivanov, speaking at a news conference with Rumsfeld, questioned the need for the patrols. "We cannot understand how these four planes can intercept al-Qaeda, the Taliban or anything else," Ivanov said. "The only thing they can intercept is a mythical Soviet threat."
Yet despite the US's official pronouncements that the troop realignment is not aimed at Russia, Moscow will likely remain keen to secure Central Asia. As the heads of the Shanghai Cooperation Organization, a six-member group that includes Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan, met at a summit meeting in Tashkent last June, Russian President Vladimir Putin made no secret that Moscow has been pushing to use a variety of groupings so as to exert its influence across the region. "The voice of Russia will be heard here," Putin told reporters after the summit.
Subsequently, Russia has recently moved to push its agenda in Central Asia through security arrangements. Notably, the Collective Security Treaty Organization (CSTO) held a large-scale military exercise on August 2-6. The Collective Rapid Reaction Force, including troops from Russia, Kazakhstan, Kyrgyzstan and Tajikistan, held anti-rebel war-games in the Kyrgyz mountains.
The exercise, code named "Frontier-2004", involved more than 2,000 soldiers from Russia and the three Central Asian members. The maneuvers took place at the Kyrgyz Defense Ministry's Edelweiss mountainous training center near the town of Balykchi on the shores of Lake Issykul. Jets and helicopters from the new Russian air base in Kant struck targets in northern Kyrgyzstan for the first time.
The war-games scenario, approved by the CSTO, involved the deployment of Russian elite troops. According to Russian media reports, units of the Ulyanovsk-based 31st Paratrooper Brigade as well as the Samara-based 3rd Special Force Brigade, as well as the 12th Special Force Brigade of Russia's military intelligence (GRU) were brought from Ulyanovsk and Yekaterinburg to Russia's Kant base in Kyrgyzstan by Il-76MD military cargo planes.
Politicians insisted the war-games were largely anti-terrorist. Following the exercise, Kyrgyz President Askar Akayev said the CSTO also is considering pre-emptive operations in Afghanistan, but gave no details. "We don't have to wait for militants from Afghanistan to cross the Afghan-Tajik border, but we should take preventive measures rather than allow them to come to the region," Akayev said.
"The situation in Central Asia is stable, but we don't rule out terrorist attacks in Afghanistan or any other countries in the region," Ivanov said earlier this month in the wake of the war games. Moscow also indicated plans to double the number of troops stationed at the Kant based by the end of this year.
Furthermore, Kyrgyzstan may become Russia's major military and political ally in Central Asia, the country's foreign minister, Askar Aitmatov, indicated last week. "Russia remains a true friend and the principal strategic partner of Kyrgyzstan. Long-term relations with Russia are the priority of our foreign policy," Aitmatov said in a speech at the Russian Kant air base during Russian Air Force Day celebrations. "The opening of the Russian air base in October last year became an indication that Russian-Kyrgyz relations are relations between allies," he said.
Moscow has also been keen to boost military ties with Uzbekistan. For instance, Russia and Uzbekistan agreed to hold major joint war games in southern Uzbekistan later this year, Ivanov announced last June.
The Kremlin has recently come up with a series of overtures towards Uzbekistan, once seen as the US's staunchest ally in Central Asia. It was hardly a coincidence that on Tuesday, Russia announced it had apprehended three men suspected of helping to organize a series of bombings in Uzbekistan earlier this year and may extradite them to their homeland for trial. The three suspects are reportedly linked to the Islamic Movement of Uzbekistan.
In the meantime, regardless of Washington's assurances that its troop redeployment is not aimed at Russia, Moscow's perceived strategic purpose remains to strengthen its influence in Central Asia. However, the new security arrangements are yet to prove their viability as vehicles of Moscow's clout in the strategic region.
Sergei Blagov covers Russia and post-Soviet states, with special attention to Asia-related issues. He has contributed to Asia Times Online since 1996. Between 1983 and 1997, he was based in Southeast Asia. In 2001 and 2002, Nova Science Publishers, NY, published two of his books on Vietnamese history.
(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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>> VENEZUELA


The Price of Dissent in Venezuela
Hugo Ch?vez's thugs celebrate their "victory" by shooting my mother.
BY THOR L. HALVORSSEN
Thursday, August 19, 2004 12:01 a.m. EDT
CARACAS, Venezuela--On Monday afternoon, dozens of people assembled in the Altamira Plaza, a public square in a residential neighborhood here that has come to symbolize nonviolent dissent in Venezuela. The crowd was there to question the accuracy of the results that announced a triumph for President Hugo Ch?vez in Sunday's recall referendum.
Within one hour of the gathering, just over 100 of Lt. Col. Ch?vez's supporters, many of them brandishing his trademark army parachutist beret, began moving down the main avenue towards the crowd in the square. Encouraged by their leader's victory, this bully-boy group had been marching through opposition neighborhoods all day. They were led by men on motorcycles with two-way radios. From afar they began to taunt the crowd in the square, chanting, "We own this country now," and ordering the people in the opposition crowd to return to their homes. All of this was transmitted live by the local news station. The Ch?vez group threw bottles and rocks at the crowd. Moments later a young woman in the square screamed for the crowd to get down as three of the men with walkie-talkies, wearing red T-shirts with the insignia of the government-funded "Bolivarian Circle," revealed their firearms. They began shooting indiscriminately into the multitude.
A 61-year-old grandmother was shot in the back as she ran for cover. The bullet ripped through her aorta, kidney and stomach. She later bled to death in the emergency room. An opposition congressman was shot in the shoulder and remains in critical care. Eight others suffered severe gunshot wounds. Hilda Mendoza Denham, a British subject visiting Caracas for her mother's 80th birthday, was shot at close range with hollow-point bullets from a high-caliber pistol. She now lies sedated in a hospital bed after a long and complicated operation. She is my mother.
I spoke with her minutes before the doctors cut open her wounds. She looked at me, frightened and traumatized, and sobbed: "I was sure they were going to kill me, they just kept shooting at me."
In a jarringly similar attack that took place three years ago, the killers were caught on tape and identified as government officials and employees. They were briefly detained--only to be released and later praised by Col. Ch?vez in his weekly radio show. Their identities are no secret and they walk the streets as free men, despite having shot unarmed civilian demonstrators in cold blood.
I was not in the square on Monday. I was preparing a complaint for the National Electoral Council regarding the fact that I had been mysteriously erased from the voter rolls and was prevented from casting a vote on Sunday. In indescribable agony I watched the television as my mother and my elderly grandparents--who were both trampled and bruised in the panic--became casualties in Venezuela's ongoing political crisis.
Col. Ch?vez assumed power in 1999. One need not go into great detail about the deterioration of Venezuelan life since then to understand why a recall referendum has been years in the making. Every aspect of existence has worsened. The only people who are not profoundly affected are those at the highest levels of the government party. Poverty, for instance, is at an all-time high and the country is afflicted, for the first time ever recorded, with malnutrition on a massive scale. This unprecedented suffering has occurred during the greatest oil boom in the nation's history (Venezuela has oil reserves on the scale of those in Iraq). Col. Ch?vez and his "revolution" have not only led a ferocious assault on civil liberties, but have also needlessly alienated one of Venezuela's closest allies, the U.S.
The recall referendum process has been obstructed and delayed at every turn. Dozens of independent polls predicted defeat for Col. Ch?vez, who did everything--including granting citizenship to half a million illegal aliens in a crude vote-buying scheme and "migrating" existing voters away from their local election office--to fix the results in his favor. One opposition leader was moved to a voting center in a city seven hours away. Another man, Miguel Romero, had for years voted in his neighborhood school in a Caracas suburb. But this time the Electoral Council computer indicated that he was to vote at the Venezuelan Embassy in Stockholm. Thousands of others, like me, were wiped from the voting rolls. Ironically, in the runup to the vote, the embassy in Stockholm, like Venezuelan diplomatic posts around the world, inexplicably ran out of passports. Many Venezuelan expatriates were thus prevented from returning to their country to vote.
In the early hours of Monday, the Electoral Council's president (who had imposed a gag order on all exit polls until a full audit of the vote had been completed) issued a statement declaring that the computer votes had been tallied and that the government had won the referendum with 58% of the vote. The announcement came in a vacuum, without an audit, with no verification whatsoever from the international observers, and over the indignant protest of two of the five council members, who publicly questioned the result's transparency.
The opposition, understandably shocked and demoralized, insisted on a hand-count of all computer voting receipts as the only way of settling the dramatic disparity between exit polls that showed 58% to 41% in favor of the recall and the announced result of 58% to 41% in favor of retaining Col. Ch?vez. Later that morning the most important observer, former President Jimmy Carter, declared that he was shown the computer tally by government supporters and that everything seemed in order. Mr. Carter then left Venezuela, and the opposition groups that had put their faith in him to facilitate a peaceful resolution to the crisis. Mr. Carter, who was vociferous and insistent about patience, transparency and hand-tallies during the Florida recount, left Venezuela to attend Mrs. Carter's birthday party.
Many in the opposition are baffled by the inverse relationship between the projected numbers and those reported by the Ch?vez regime. One possible clue to this remarkable phenomenon lies with the companies hired to supply the voting machines and the software. Smartmatic Corp., a Florida company that has never before supplied election machinery, is owned by two Venezuelans. The software came from Bizta Software, owned by the same two people. The Miami Herald recently revealed that the Ch?vez regime spent $200,000 last year to purchase 28% of Bizta and put a government official and longtime Ch?vez ally on the board. After the story broke, Bizta bought back the government-held shares and the official resigned from the board. But not until after the two companies were granted a significant part of the $91 million contract for the referendum. Executives at both Smartmatic and Bizta have denied any political allegiance to the Ch?vez regime and have issued public statements saying the contract was awarded purely on the merits.
Col. Ch?vez has publicly stated that the results of the referendum are irreversible and permanent and that the revolution will now intensify. He is firmly in control of the executive, legislative and judicial branches of government; the armed forces; electoral bodies and two-thirds of the country's economy.
In a free and decent society, it is not a crime to differ with the democratic government. The vast distance between democracy and contemporary Venezuela may be seen in the depth of Col. Ch?vez's disregard for Monday's bloodbath. Blithely ignoring the overwhelming video evidence that a massacre had taken place in his name, he minimized the incident's importance and suggested that the gunmen were most likely linked to opposition groups. His reactions chillingly indicate the fate that might befall the millions of Venezuelans who oppose him, and who have so earnestly and so repeatedly sought to avoid political violence in registering their dissent by peaceful protest or by vote.
Mr. Halvorssen is First Amendment scholar at The Commonwealth Foundation. He lives in New York.






Evidence of an electoral fraud is growing
Enrique ter Horst IHT
Wednesday, August 18, 2004
Ch?vez and the vote
CARACAS The perception that a massive electronic fraud led to President Hugo Ch?vez's mandate not being cut short in the recall referendum on Sunday is rapidly gaining ground in Venezuela. All exit polls carried out on the day had given the opposition an advantage of between 12 percent and 19 percent. But preliminary results announced by the government-controlled National Electoral Council at 3:30 a.m. gave Ch?vez 58.2 percent of the vote, against 41.7 percent for the opposition.
At first people scratched their heads in disbelief, including many Ch?vez supporters, but accepted these figures after C?sar Gaviria, secretary general of the Organization of American States, and former President Jimmy Carter said their own quick counts coincided with the electoral council's figures. Two days after the referendum, however, evidence is growing that the software of the touch-screen voting machines had been tampered with. The opposition has requested that the votes be recounted manually and that the boxes holding the voting papers, currently stored in army garrisons, be put under the custody of international observers.
Ch?vez had to be dragged kicking and screaming into holding the presidential recall referendum, even though it had been provided for by his Constitution. He was conscious that two-thirds of the people opposed his Cuban-inspired "revolutionary project" and his autocratic, aggressive style.
Two petitions were necessary to overcome the electoral council's tricks and delaying tactics. After the second petition was declared valid, under strong national and international pressure, and after having poured billions of dollars into social programs, Ch?vez accepted that the referendum be held Aug. 15.
The electoral council has stated that the voting machines were audited after the vote, but the council did so in the absence of any opposition representative or any international observer. A cause for even greater concern is the fact that the papers the new machines produced confirming the voter's choice - which the voter had to verify and then drop into a closed box - were not added up and compared with the final numbers these machines produce at the end of the voting process, as the voting-machine manufacturer had suggested.
Evidence of foul play has surfaced. In the town of Valle de la Pascua, where papers were counted at the initiative of those manning the voting center, the Yes vote had been cut by more than 75 percent, and the entire voting material was seized by the national guard shortly after the difference was established.
Three machines in a voting center in the state of Bolivar that has generally voted against Ch?vez all showed the same 133 votes for the Yes option, and higher numbers for the No option. Two other machines registered 126 Yes votes and much higher votes for the No. The opposition alleges that these machines, which can both send and receive information, were reprogrammed to start adjudicating all votes to the No option after a given number of Yes votes has been registered.
Although the Organization of American States and the Carter Center have called the election free and fair, their quick count justifying this statement was also based only on the numbers provided by the voting machines. The two organizations had brokered an agreement to examine, in the presence of government and opposition representatives, a sample of 150 voting points chosen at random. A comparison of the results printed out by these machines with the papers contained in the corresponding boxes was to be concluded this week. But the opposition now wants all machines and ballot boxes to be examined.
This is not just another election in a country where political actors abide by democratic rules and civilized behavior. It is an election where a choice of society is being made, and where one side is prepared to use any method to remain in power, even elections if it is assured of "winning" them.
Enrique ter Horst, a Venezuelan national, is a lawyer and political analyst in Caracas. A former assistant secretary general of the United Nations, he headed the UN peacekeeping operations in El Salvador and Haiti, and was the UN Deputy High Commissioner of Human Rights.
Copyright ? 2004 The International Herald Tribune | www.iht.com



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>> CFR

A World Without Power
By Niall Ferguson
July/August 2004
Critics of U.S. global dominance should pause and consider the alternative. If the United States retreats from its hegemonic role, who would supplant it? Not Europe, not China, not the Muslim world^~and certainly not the United Nations. Unfortunately, the alternative to a single superpower is not a multilateral utopia, but the anarchic nightmare of a new Dark Age.
We tend to assume that power, like nature, abhors a vacuum. In the history of world politics, it seems, someone is always the hegemon, or bidding to become it. Today, it is the United States; a century ago, it was the United Kingdom. Before that, it was France, Spain, and so on. The famed 19th-century German historian Leopold von Ranke, doyen of the study of statecraft, portrayed modern European history as an incessant struggle for mastery, in which a balance of power was possible only through recurrent conflict.
The influence of economics on the study of diplomacy only seems to confirm the notion that history is a competition between rival powers. In his bestselling 1987 work, The Rise and Fall of the Great Powers: Economic Change and Military Conflict from 1500 to 2000, Yale University historian Paul Kennedy concluded that, like all past empires, the U.S. and Russian superpowers would inevitably succumb to overstretch. But their place would soon be usurped, Kennedy argued, by the rising powers of China and Japan, both still unencumbered by the dead weight of imperial military commitments.
In his 2001 book, The Tragedy of Great Power Politics, University of Chicago political scientist John J. Mearsheimer updates Kennedy's account. Having failed to succumb to overstretch, and after surviving the German and Japanese challenges, he argues, the United States must now brace for the ascent of new rivals. ([A] rising China is the most dangerous potential threat to the United States in the early twenty-first century,? contends Mearsheimer. ([T]he United States has a profound interest in seeing Chinese economic growth slow considerably in the years ahead.? China is not the only threat Mearsheimer foresees. The European Union (EU) too has the potential to become (a formidable rival.?
Power, in other words, is not a natural monopoly; the struggle for mastery is both perennial and universal. The (unipolarity? identified by some commentators following the Soviet collapse cannot last much longer, for the simple reason that history hates a hyperpower. Sooner or later, challengers will emerge, and back we must go to a multipolar, multipower world.
But what if these esteemed theorists are all wrong? What if the world is actually heading for a period when there is no hegemon? What if, instead of a balance of power, there is an absence of power?
Such a situation is not unknown in history. Although the chroniclers of the past have long been preoccupied with the achievements of great powers^~whether civilizations, empires, or nation-states^~they have not wholly overlooked eras when power receded.
Unfortunately, the world's experience with power vacuums (eras of (apolarity,? if you will) is hardly encouraging. Anyone who dislikes U.S. hegemony should bear in mind that, rather than a multipolar world of competing great powers, a world with no hegemon at all may be the real alternative to U.S. primacy. Apolarity could turn out to mean an anarchic new Dark Age: an era of waning empires and religious fanaticism; of endemic plunder and pillage in the world's forgotten regions; of economic stagnation and civilization's retreat into a few fortified enclaves.
Pretenders to the Throne
Why might a power vacuum arise early in the 21st century? The reasons are not especially hard to imagine.
The clay feet of the U.S. colossus | Powerful though it may seem^~in terms of economic output, military might, and (soft? cultural power^~the United States suffers from at least three structural deficits that will limit the effectiveness and duration of its quasi-imperial role in the world. The first factor is the nation's growing dependence on foreign capital to finance excessive private and public consumption. It is difficult to recall any past empire that long endured after becoming so dependent on lending from abroad. The second deficit relates to troop levels: The United States is a net importer of people and cannot, therefore, underpin its hegemonic aspirations with true colonization. At the same time, its relatively small volunteer army is already spread very thin as a result of major and ongoing military interventions in Afghanistan and Iraq. Finally, and most critically, the United States suffers from what is best called an attention deficit. Its republican institutions and political traditions make it difficult to establish a consensus for long-term nation-building projects. With a few exceptions, most U.S. interventions in the past century have been relatively short lived. U.S. troops have stayed in West Germany, Japan, and South Korea for more than 50 years; they did not linger so long in the Philippines, the Dominican Republic, Haiti, or Vietnam, to say nothing of Lebanon and Somalia. Recent trends in public opinion suggest that the U.S. electorate is even less ready to sacrifice blood and treasure in foreign fields than it was during the Vietnam War.
(Old Europe? grows older | Those who dream the EU might become a counterweight to the U.S. hyperpower should continue slumbering. Impressive though the EU's enlargement this year has been^~not to mention the achievement of 12-country monetary union^~the reality is that demography likely condemns the EU to decline in international influence and importance. With fertility rates dropping and life expectancies rising, West European societies may, within fewer than 50 years, display median ages in the upper 40s. Europe's (dependency ratio? (the number of non-working-age citizens for every working-age citizen) is set to become cripplingly high. Indeed, Old Europe will soon be truly old. By 2050, one in every three Italians, Spaniards, and Greeks is expected to be 65 or older, even allowing for ongoing immigration. Europeans therefore face an agonizing choice between Americanizing their economies, i.e., opening their borders to much more immigration, with the cultural changes that would entail, or transforming their union into a fortified retirement community. Meanwhile, the EU's stalled institutional reforms mean that individual European nation-states will continue exercising considerable autonomy outside the economic sphere, particularly in foreign and security policy.
China's coming economic crisis | Optimistic observers of China insist the economic miracle of the past decade will endure, with growth continuing at such a sizzling pace that within 30 or 40 years China's gross domestic product will surpass that of the United States. Yet it is far from clear that the normal rules for emerging markets are suspended for Beijing's benefit. First, a fundamental incompatibility exists between the free-market economy, based inevitably on private property and the rule of law, and the Communist monopoly on power, which breeds corruption and impedes the creation of transparent fiscal, monetary, and regulatory institutions. As is common in (Asian tiger? economies, production is running far ahead of domestic consumption^~thus making the economy heavily dependent on exports^~and far ahead of domestic financial development. Indeed, no one knows the full extent of the problems in the Chinese domestic banking sector. Those Western banks that are buying up bad debts to establish themselves in China must remember that this strategy was tried once before: a century ago, in the era of the Open Door policy, when U.S. and European firms rushed into China only to see their investments vanish amid the turmoil of war and revolution.
Then, as now, hopes for China's development ran euphorically high, especially in the United States. But those hopes were dashed, and could be disappointed again. A Chinese currency or banking crisis could have earth-shaking ramifications, especially when foreign investors realize the difficulty of repatriating assets held in China. Remember, when foreigners invest directly in factories rather than through intermediaries such as bond markets, there is no need for domestic capital controls. After all, how does one repatriate a steel mill?
The fragmentation of Islamic civilization | With birthrates in Muslim societies more than double the European average, the Islamic countries of Northern Africa and the Middle East are bound to put pressure on Europe and the United States in the years ahead. If, for example, the population of Yemen will exceed that of Russia by 2050 (as the United Nations forecasts, assuming constant fertility), there must either be dramatic improvements in the Middle East's economic performance or substantial emigration from the Arab world to aging Europe. Yet the subtle Muslim colonization of Europe's cities^~most striking in places like Marseille, France, where North Africans populate whole suburbs^~may not necessarily portend the advent of a new and menacing (Eurabia.? In fact, the Muslim world is as divided as ever, and not merely along the traditional fissure between Sunnis and Shiites. It is also split between those Muslims seeking a peaceful modus vivendi with the West (an impulse embodied in the Turkish government's desire to join the EU) and those drawn to the revolutionary Islamic Bolshevism of renegades like al Qaeda leader Osama bin Laden. Opinion polls from Morocco to Pakistan suggest high levels of anti-American sentiment, but not unanimity. In Europe, only a minority expresses overt sympathy for terrorist organizations; most young Muslims in England clearly prefer assimilation to jihad. We are a long way from a bipolar clash of civilizations, much less the rise of a new caliphate that might pose a geopolitical threat to the United States and its allies.
In short, each of the potential hegemons of the 21st century^~the United States, Europe, and China^~seems to contain within it the seeds of decline; and Islam remains a diffuse force in world politics, lacking the resources of a superpower.
Dark and Disconnected
Suppose, in a worst-case scenario, that U.S. neoconservative hubris is humbled in Iraq and that the Bush administration's project to democratize the Middle East at gunpoint ends in ignominious withdrawal, going from empire to decolonization in less than two years. Suppose also that no aspiring rival power shows interest in filling the resulting vacuums^~not only in coping with Iraq but conceivably also Afghanistan, the Balkans, and Haiti. What would an apolar future look like?
The answer is not easy, as there have been very few periods in world history with no contenders for the role of global, or at least regional, hegemon. The nearest approximation in modern times could be the 1920s, when the United States walked away from President Woodrow Wilson's project of global democracy and collective security centered on the League of Nations. There was certainly a power vacuum in Central and Eastern Europe after the collapse of the Romanov, Habsburg, Hohenzollern, and Ottoman empires, but it did not last long. The old West European empires were quick to snap up the choice leftovers of Ottoman rule in the Middle East. The Bolsheviks had reassembled the czarist empire by 1922. And by 1936, German revanche was already far advanced.
One must go back much further in history to find a period of true and enduring apolarity; as far back, in fact, as the ninth and 10th centuries.
In this era, the remains of the Roman Empire^~Rome and Byzantium^~receded from the height of their power. The leadership of the West was divided between the pope, who led Christendom, and the heirs of Charlemagne, who divided up his short-lived empire under the Treaty of Verdun in 843. No credible claimant to the title of emperor emerged until Otto was crowned in 962, and even he was merely a German prince with pretensions (never realized) to rule Italy. Byzantium, meanwhile, was dealing with the Bulgar rebellion to the north.
By 900, the Abbasid caliphate initially established by Abu al-Abbas in 750 had passed its peak; it was in steep decline by the middle of the 10th century. In China, too, imperial power was in a dip between the T'ang and Sung dynasties. Both these empires had splendid capitals^~Baghdad and Ch'ang-an^~but neither had serious aspirations of territorial expansion.
The weakness of the old empires allowed new and smaller entities to flourish. When the Khazar tribe converted to Judaism in 740, their khanate occupied a Eurasian power vacuum between the Black Sea and the Caspian Sea. In Kiev, far from the reach of Byzantium, the regent Olga laid the foundation for the future Russian Empire in 957 when she converted to the Orthodox Church. The Seljuks^~forebears of the Ottoman Turks^~carved the Sultanate of Rum as the Abbasid caliphate lost its grip over Asia Minor. Africa had its mini-empire in Ghana; Central America had its Mayan civilization. Connections between these entities were minimal or nonexistent. This condition was the antithesis of globalization. It was a world broken up into disconnected, introverted civilizations.
One feature of the age was that, in the absence of strong secular polities, religious questions often produced serious convulsions. Indeed, religious institutions often set the political agenda. In the eighth and ninth centuries, Byzantium was racked by controversy over the proper role of icons in worship. By the 11th century, the pope felt confident enough to humble Holy Roman Emperor Henry IV during the battle over which of them should have the right to appoint bishops. The new monastic orders amassed considerable power in Christendom, particularly the Cluniacs, the first order to centralize monastic authority. In the Muslim world, it was the ulema (clerics) who truly ruled. This atmosphere helps explain why the period ended with the extraordinary holy wars known as the Crusades, the first of which was launched by European Christians in 1095.
Yet, this apparent clash of civilizations was in many ways just another example of the apolar world's susceptibility to long-distance military raids directed at urban centers by more backward peoples. The Vikings repeatedly attacked West European towns in the ninth century^~Nantes in 842, Seville in 844, to name just two. One Frankish chronicler lamented (the endless flood of Vikings? sweeping southward. Byzantium, too, was sacked in 860 by raiders from Rus, the kernel of the future Russia. This (fierce and savage tribe? showed (no mercy,? lamented the Byzantine patriarch. It was like (the roaring sea + destroying everything, sparing nothing.? Such were the conditions of an anarchic age.
Small wonder that the future seemed to lie in creating small, defensible, political units: the Venetian republic^~the quintessential city-state, which was conducting its own foreign policy by 840^~or Alfred the Great's England, arguably the first thing resembling a nation-state in European history, created in 886.
Superpower Failure
Could an apolar world today produce an era reminiscent of the age of Alfred? It could, though with some important and troubling differences.
Certainly, one can imagine the world's established powers^~the United States, Europe, and China^~retreating into their own regional spheres of influence. But what of the growing pretensions to autonomy of the supranational bodies created under U.S. leadership after the Second World War? The United Nations, the International Monetary Fund, the World Bank, and the World Trade Organization (formerly the General Agreement on Tariffs and Trade) each considers itself in some way representative of the (international community.? Surely their aspirations to global governance are fundamentally different from the spirit of the Dark Ages?
Yet universal claims were also an integral part of the rhetoric of that era. All the empires claimed to rule the world; some, unaware of the existence of other civilizations, maybe even believed that they did. The reality, however, was not a global Christendom, nor an all-embracing Empire of Heaven. The reality was political fragmentation. And that is also true today. The defining characteristic of our age is not a shift of power upward to supranational institutions, but downward. With the end of states' monopoly on the means of violence and the collapse of their control over channels of communication, humanity has entered an era characterized as much by disintegration as integration.
If free flows of information and of means of production empower multinational corporations and nongovernmental organizations (as well as evangelistic religious cults of all denominations), the free flow of destructive technology empowers both criminal organizations and terrorist cells. These groups can operate, it seems, wherever they choose, from Hamburg to Gaza. By contrast, the writ of the international community is not global at all. It is, in fact, increasingly confined to a few strategic cities such as Kabul and Pristina. In short, it is the nonstate actors who truly wield global power^~including both the monks and the Vikings of our time.
So what is left? Waning empires. Religious revivals. Incipient anarchy. A coming retreat into fortified cities. These are the Dark Age experiences that a world without a hyperpower might quickly find itself reliving. The trouble is, of course, that this Dark Age would be an altogether more dangerous one than the Dark Age of the ninth century. For the world is much more populous^~roughly 20 times more^~so friction between the world's disparate (tribes? is bound to be more frequent. Technology has transformed production; now human societies depend not merely on freshwater and the harvest but also on supplies of fossil fuels that are known to be finite. Technology has upgraded destruction, too, so it is now possible not just to sack a city but to obliterate it.
For more than two decades, globalization^~the integration of world markets for commodities, labor, and capital^~has raised living standards throughout the world, except where countries have shut themselves off from the process through tyranny or civil war. The reversal of globalization^~which a new Dark Age would produce^~would certainly lead to economic stagnation and even depression. As the United States sought to protect itself after a second September 11 devastates, say, Houston or Chicago, it would inevitably become a less open society, less hospitable for foreigners seeking to work, visit, or do business. Meanwhile, as Europe's Muslim enclaves grew, Islamist extremists' infiltration of the EU would become irreversible, increasing trans-Atlantic tensions over the Middle East to the breaking point. An economic meltdown in China would plunge the Communist system into crisis, unleashing the centrifugal forces that undermined previous Chinese empires. Western investors would lose out and conclude that lower returns at home are preferable to the risks of default abroad.
The worst effects of the new Dark Age would be felt on the edges of the waning great powers. The wealthiest ports of the global economy^~from New York to Rotterdam to Shanghai^~would become the targets of plunderers and pirates. With ease, terrorists could disrupt the freedom of the seas, targeting oil tankers, aircraft carriers, and cruise liners, while Western nations frantically concentrated on making their airports secure. Meanwhile, limited nuclear wars could devastate numerous regions, beginning in the Korean peninsula and Kashmir, perhaps ending catastrophically in the Middle East. In Latin America, wretchedly poor citizens would seek solace in Evangelical Christianity imported by U.S. religious orders. In Africa, the great plagues of AIDS and malaria would continue their deadly work. The few remaining solvent airlines would simply suspend services to many cities in these continents; who would wish to leave their privately guarded safe havens to go there?
For all these reasons, the prospect of an apolar world should frighten us today a great deal more than it frightened the heirs of Charlemagne. If the United States retreats from global hegemony^~its fragile self-image dented by minor setbacks on the imperial frontier^~its critics at home and abroad must not pretend that they are ushering in a new era of multipolar harmony, or even a return to the good old balance of power.
Be careful what you wish for. The alternative to unipolarity would not be multipolarity at all. It would be apolarity^~a global vacuum of power. And far more dangerous forces than rival great powers would benefit from such a not-so-new world disorder.

Niall Ferguson is Herzog professor of history at New York University's Stern School of Business and senior fellow at the Hoover Institution at Stanford University. His latest book is Colossus: The Price of America's Empire (New York: Penguin Press, 2004)
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The Metrosexual Superpower
By Parag Khanna
July/August 2004
The stylish European Union struts past the bumbling United States on the catwalk of global diplomacy.
According to Michael Flocker's 2003 bestseller, The Metrosexual Guide to Style: A Handbook for the Modern Man, the trendsetting male icons of the 21st century must combine the coercive strengths of Mars and the seductive wiles of Venus. Put simply, metrosexual men are muscular but suave, confident yet image-conscious, assertive yet clearly in touch with their feminine sides. Just consider British soccer star David Beckham. He is married to former Spice Girl Victoria (Posh? Adams, but his combination of athleticism and cross-dressing make him a sex symbol to both women and men worldwide, not to mention the inspiration for the 2002 hit movie Bend It Like Beckham. Substance, Beckham shows, is nothing without style.
Geopolitics is much the same. American neoconservatives such as Robert Kagan look down upon feminine, Venus-like Europeans, gibing their narcissistic obsession with building a postmodern, bureaucratic paradise. The United States, by contrast, supposedly carries the mantle of masculine Mars, boldly imposing freedom in the world's nastiest neighborhoods. But by cleverly deploying both its hard power and its sensitive side, the European Union (EU) has become more effective^~and more attractive^~than the United States on the catwalk of diplomatic clout. Meet the real New Europe: the world's first metrosexual superpower.
Metrosexuals always know how to dress for the occasion (or mission). Spreading peace across Eurasia serves U.S. interests, but it's best done by donning Armani pinstripes rather than U.S. Army fatigues. After the fall of Soviet communism, conservative U.S. thinkers feared a united Germany vying with Russia for hegemony in Central Europe. Yet, by brandishing only a slick portfolio of economic incentives, the EU has incorporated many of the former Soviet republics and satellites in the Baltics and Eastern Europe. Even Turkey is freshening up with eau d'Europe. Ankara resisted Washington's pressure to provide base rights for the invasion of Iraq in 2003. But to get backstage in Brussels, it has had to smooth out its more unseemly blemishes^~abolishing the death penalty, taking steps to resolve the Cyprus dispute, and introducing laws to protect its Kurdish minority.
Metrosexuals may spend a long time standing in front of the mirror, but they never shop alone. Stripping off stale national sovereignty (that's so last century), Europeans now parade their (pooled power,? the new look for this geopolitical season. As a political, economic, and military union with some 450 million citizens, a $9 trillion economy, and armies surpassing 1.6 million soldiers, Europe is now a whole greater than the sum of its parts.
Indeed, Europe actually contributes more to U.S. foreign policy goals than the U.S. government^~and does so far more fashionably. Robert Cooper, one of Britain's former defense gurus now shaping Europe's common foreign policy, argues that Europe's (magnetic allure? compels countries to rewrite their laws and constitutions to meet European standards. The United States conceives of power primarily in military terms, thus confusing presence with influence. By contrast, Europeans understand power as overall leverage. As a result, the EU is the world's largest bilateral aid donor, providing more than twice as much aid to poor countries as the United States, and it is also the largest importer of agricultural goods from the developing world, enhancing its influence in key regions of instability. Through massive deployments of (soft power? (such as economic clout and cultural appeal) Europe has made hard power less necessary. After expanding to 25 members, the EU accounts for nearly half of the world's outward foreign direct investment and exerts greater leverage than the United States over pivotal countries such as Brazil and Russia. As more oil-producing nations consider trading in euros, Europe will gain greater influence in the international marketplace. Even rogue states swoon over Europe's allure; just recall how Libya's Colonel Muammar el-Qaddafi greeted British Prime Minister Tony Blair during a recent meeting in Tripoli. (You are looking good,? gushed Libya's strongman. (You are still young.?
Brand Europe is taking over. From environmental sustainability and international law to economic development and social welfare, European views are more congenial to international tastes and more easily exported than their U.S. variants. Even the Bush administration's new strategy toward the (Greater Middle East? is based on the Helsinki model, which was Europe's way of integrating human rights standards into collective security institutions. Furthermore, regional organizations such as the Association of Southeast Asian Nations, Mercosur, and the African Union are redesigning their institutions to look more like the EU. Europe's flashy new symbol of power, the Airbus 380, will soon strut on runways all over Asia. And the euro is accepted even where they don't take American Express.
But don't be deceived by the metrosexual superpower's pleatless pants^~Europe hasn't lost touch with its hard assets. Even without a centralized military command structure, the EU has recently led military operations in the Democratic Republic of the Congo and Macedonia, and it will increase troop deployments to support German and British forces in stabilizing Afghanistan. European countries already provide 10 times more peacekeepers to U.N. operations than the United States. In late 2004, the EU will take over all peacekeeping and policing operations in Bosnia and Herzegovina from NATO, and Europe's 60,000-troop Rapid Reaction Force will soon be ready to deploy around the world.
In the fight against terrorism, Europe also displays the right ensemble of strengths. Europeans excel at human intelligence, which requires expert linguists and cultural awareness. French espionage agencies have reportedly infiltrated al Qaeda cells, and German and Spanish law enforcement efforts have led to the capture of numerous al Qaeda operatives. After the March 2004 terrorist attack in Madrid, Spain's incoming prime minister immediately declared his country would (return to Europe,? signaling his opposition to the Bush administration's war on terror. Indeed, U.S. Defense Secretary Donald Rumsfeld's (New Europe? is already pass?, shorter lived than the bellbottom revival.
To some observers, the EU may always be little more than a cheap superpower knockoff with little substance to show but a common multilingual passport. But after 60 years of dressing up, Europe has revealed its true 21st-century orientation. Just as metrosexuals are redefining masculinity, Europe is redefining old notions of power and influence. Expect Bend It Like Brussels to play soon in capital cities worldwide.

Parag Khanna is a fellow in global governance at the Brookings Institution.
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Demography Is Not Destiny
By Michael S. Teitelbaum, Jay Winter, and Phillip Longman
From Foreign Affairs, September/October 2004
MICHAEL S. TEITELBAUM is Program Director at the Alfred P. Sloan Foundation. Jay Winter is Professor of History at Yale University. They are the authors of The Fear of Population Decline.
A Pretext to Panic
Michael S. Teitelbaum and Jay Winter
"The Global Baby Bust," by Phillip Longman (May/June 2004), offers a new version of an old fear: the threat of population decline, which has emerged periodically throughout the past century as a major focus of political discourse. Such worries seem to crop up at predictable moments: when a dominant political or economic power begins to feel unsure of its mastery and uncertain about the future, many thinkers turn to demography for an explanation of its plight.
In the late nineteenth century, for example, French patriots of all political stripes, following their crushing defeat in the Franco-Prussian War, began to blame France's low fertility (compared to that of then demographically dynamic Germany) for its decline. Similarly, a few years later, in the early 1900s, the sorry performance of the British army in containing a handful of Boer farmers in South Africa gave rise to worries about population decline in the United Kingdom.
Again in the 1930s and 1940s, dire projections (which we now know to have been exaggerated) led to concerns about low fertility rates in Europe, the United States, and elsewhere. When fertility rates rose sharply in the 1950s, however-largely irrespective of policy-such concerns disappeared, only to be replaced by the opposite fear of a population "explosion." Then came the economic and political crises of the mid-1970s, sparked by the 1973 Middle East war and the oil crisis it precipitated. Suddenly, new voices began predicting a decline in U.S. power, linked to falling fertility and a "birth dearth."
Today, Americans are even more anxious-about global terrorism, the military and economic costs of the U.S. interventions in Iraq and Afghanistan, and the re-emergence of large budget and trade deficits. Thus it should not be surprising that we are once more confronted with worried conjecture about population decline, from Longman and other writers.
Longman argues that increasing levels of fertility will ward off economic collapse and reinforce "modern" rather than "traditional" societies committed to conservative religious ideas. Government, he argues, can play a role in increasing population in developed countries by making the trajectories of family life and working life more compatible. This is a valuable point in principle. The problem, however, is that both Longman's diagnosis and his prescription are based on unproved or unprovable assertions. There is very little evidence, for example, that the kinds of economic incentives Longman urges have ever reversed long-term demographic trends. In some cases, policies have helped to accelerate an already existing trend, but there is no evidence that government can turn around behavior as complex as that relating to child-bearing.
There are two other general problems with Longman's argument. To begin with, he makes unproven claims about the link between fertility on the one hand and politics and economics on the other, stressing demographic explanations for global or national power shifts instead of more obvious causes. Longman also makes unfair assumptions about aging societies, suggesting, for example, that they become stuck in older patterns of thought and practice. But the histories of technological innovation and economic dynamism provide no support whatever for this assertion. Thus even if it were possible to reverse demographic aging through the right policies-which it is not-there is no reason to assume that it would make a difference in patterns of economic growth. We simply do not know enough to make daring claims such as Longman's.
Instead of using dramatic metaphors such as a "population bomb," "birth dearth," or "empty cradle," it would be wiser to view demographic change as the shifting of the tectonic plates of human societies. Compared with political, economic, and technological changes, demographic growth or decline is usually slow and gradual. Indeed, it is often impossible to perceive in the short term, proceeding so slowly that societies have plenty of time both to adjust to increasing or declining numbers and to modify their fertility behavior should they choose to do so.
The slow pace of demographic change also forces those seeking to amplify its importance to deploy long-range projections in order to forecast the future. But it is impossible to accurately anticipate what will happen in 50 or 100 years, and it is a mistake-albeit a common one-to embrace such projections as reliable predictions.
Rather than resurrecting the old ghost of population decline, as Longman does, it would be far better to consider the more intricate and complex interplay between demographic and economic or military phenomena. Contrary to what Longman argues, some societies actually benefit from lower fertility rates. It is simply not credible to explain the turbulence of the contemporary world by pointing to declining fertility rates alone; this attributes far more geopolitical significance to demographic trends than they deserve. Demography matters-but not as much as pessimists such as Longman think.
LONGMAN REPLIES:
After World War II, the GI bill dramatically lowered the cost of home ownership for millions of young Americans. Its educational benefits also allowed millions of men still in their twenties to start earning nearly as much as their fathers. The bill's purpose was not to create a baby boom in the United States. But that is what it did-a good example of how government policies, even when not explicitly pro-natal, can make the economics of parenthood less punishing and thereby enable more people to afford the children they want.
Today, in both Europe and the United States, women coming to the end of their reproductive years report that they did not have as many children as they would have liked. Such statements suggest an implicit demand for children that is not being met. The reasons for this trend are complex, but many are clearly within the scope of government to ameliorate.
One way to do this would be to give parents relief from punishing and unprecedented payroll taxes. Other ways would be to make access to health care less contingent on full-time work, to encourage greater age diversity in university admissions, and to provide more resources for childcare. Within Europe today, the highest fertility rates are found in the nations that do the most to ease the strains between work and family life.
Are fears of population decline overblown? The matter cannot be settled by pointing to history, because no previous society has experienced population aging on the scale and at the speed of that now occurring throughout the world. Demographic change once moved at a tectonic pace. But countries such as China are now aging as much in one generation as countries such as France did over the course of centuries. And even in healthy, peaceful populations, fertility rates are falling well below replacement levels and staying there-a trend that, again, has no historical precedent.
How certain is the global aging trend? One can be quite sure how many elders there will be over the course of the next 70 to 80 years because those people have already been born. And without some new totalitarian or fundamentalist force commanding procreation, the global decline in fertility rates is unlikely to reverse itself.
As I stated in my article, lower fertility does seem to bring some economic benefits when it begins. And as I discuss in greater detail in my book, The Empty Cradle, there are many ways in which societies can encourage more productivity and more productive aging. But a society that consistently consumes more human capital than it produces obviously must prepare for new and difficult challenges.

www.foreignaffairs.org is copyright 2002--2004 by the Council on Foreign Relations. All rights reserved.


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>> AHEM

>> 1...



HOLY BALONEY [John Derbyshire]
I'm sick of hearing about this "holy city of Najaf" and its "sacred shrine."
http://www.nationalreview.com/thecorner/corner.asp
Why aren't the world's 60 million (?) Shi-ites in a state of fuming outrage that this supposed holy of holies is occupied by a gang of armed thugs led by a bogus un-credentialed pseudo-cleric with a political agenda? I know how *I* would feel if Canterbury Cathedral were so occupied.
Why don't a few ten thousand of the world's pious Shi'ites march unarmed on this "holy city" demanding that Muqtada al Sadr get the heck out of there? Sure, they might get killed -- but aren't they supposed to embrace martyrdom? What better death for a Shi'ite than while defending the holy shrine?
The truth is, of course, that poking a finger in the infidel's eye trumps any amount of holiness in any number of shrines. Far from being outraged by the spectacle of their holy places being desecrated by gangsters, the world's Shi'ites are chuckling with glee at the sight of one of their own, however uncredentialed, making a monkey of Uncle Sam.
Posted at 11:10 AM


>> 2..."First Responder Fetishists"

Five reasons to fear the Democratic party
Michelle Malkin (archive)
July 28, 2004

The theme of the Democratic National Convention on Wednesday night is "A Stronger More Secure America," which will be capped off by a rousing speech from a renowned law-and-order Democrat: Al Sharpton. No joke.
Here are five other reasons to be afraid, very afraid, of putting a Democratic administration in charge of guarding America's gates.
1. Ted Kennedy. The senior bloviator from Massachusetts has worked relentlessly since the Sept. 11 attacks to cripple homeland defense. For once, Teresa Heinz-Kerry speaks for me: "Ted Kennedy I don't trust."
Last January, he secretly attempted to remove funding for the National Security Entry-Exit Registration System (NSEERS) -- a Justice Department program that helped nab at least 330 known foreign criminals, 15 illegal-alien felons and three known terrorists who attempted to enter the country. Last month, he introduced legislation that would gut the PATRIOT Act and radically restructure the immigration court system to protect and strengthen illegal aliens' rights.
He opposes allowing the nation's 600,000 local and state law enforcement officers to cooperate with federal immigration authorities. And, in proposing that the federal government maintain a new national registry of law-abiding gun purchasers, he has exploited the War on Terrorism to advance his anti-Second Amendment agenda.
If the Sept. 11 attacks were a "failure of imagination" as the 9/11 commission concluded, protecting America requires that we imagine this bone-chilling scenario and do all we can to prevent another disaster: Ted Kennedy, attorney general of the United States.
2. The American Civil Liberties Union. The organization maintains dangerously absolutist positions against the use of torture to gather intelligence from al Qaeda terrorists, against the designation of enemy combatants apprehended on either foreign or American soil, and against common-sense profiling in wartime. The ACLU joined Sen. Kennedy in opposing the carefully targeted NSEERS program. It sued to stop enactment of the Aviation and Transportation Security Act, which tightened employment requirements for airport screeners. And under the guise of protecting civil rights, the ACLU supported the infamous wall of separation that handicapped communications between U.S. intelligence and law-enforcement agencies fighting terrorism.
In the nearly three years since the mass murder of 3,000 innocent people on American soil by fanatical Muslim terrorists, there is not a single law or policy that the ACLU has supported that would help prevent a bloody repeat of Sept. 11.
3. The Professional Grievance-Mongers. From the National Association for the Advancement of Colored People to the Council on American-Islamic Relations, the collective response of the Diversity Is Our Strength crowd to the War on Terror has been to cry, "Racist!" The ethnic shakedown artists who have sued over every slight and hyped every faked claim of a hate crime are America-bashing enablers of the worst sort -- and they are the heart and soul of the Democratic Party.
4. The Open Borders Lobby. Longtime readers know of my dissatisfaction with the Bush administration's unwillingness to get serious control of our immigration chaos. But if you are unhappy with the lack of progress on securing our land, air and sea ports of entry, it will only get worse under Kerry-Edwards. Groups such as the American Immigration Lawyers Association, the National Council of La Raza, and the Ford Foundation have protested enforcement, detention, deportation, employer sanctions, and secure identification measures every step of the way. It is from these ranks that a Democratic administration will draw upon to staff the Justice Department, Department of Transportation and Department of Homeland Security. Scary.
5. First Responder Fetishists. In her convention remarks on Monday night, New York Sen. Hillary Clinton said the first homeland security priority in response to the 9/11 report was the "need to fully equip and train . . . our first responders in the event of a terrorist attack." Eager to suck up to men and women in uniform, John Kerry has proposed adding 100,000 first responders to the ranks of firefighters and emergency medical personnel nationwide. As I have said before, there is no question that our brave firefighters, cops and emergency personnel need increased training and support -- but dialing 911 is not the solution to stopping another 9/11.

And neither is voting the party of the Chicken Little Clean-Up Crew into office.

Michelle Malkin is a syndicated columnist and maintains her weblog at michellemalkin.com




>> 3

Touch of Gray
by Peter Beinart
https://ssl.tnr.com/p/docsub.mhtml?i=20040830&s=trb083004
Post date 08.19.04 | Issue date 08.30.04
Here's a little refresher. On March 31, four American contractors are murdered in Falluja, their mutilated bodies dragged through the streets. American officials pledge to retake the city and bring the killers to justice. On April 5, 1,200 Marines encircle Falluja--digging trenches and blockading roads. After two weeks of sporadic fighting in which 36 Americans are killed, the United States halts the siege--on the condition that the militants hand over their heavy weapons. When they don't, the United States extends the cease-fire, despite insurgent attacks. Finally, on April 27, the Marines prepare for an all-out assault. U.S. planes drop flyers reading, "If you are a terrorist, beware, because your last day was yesterday." Lieutenant Karl Banke, a platoon leader with the 1st Battalion, 5th Marine Regiment, tells The Washington Post, "Every one of them [in his platoon] has a hunger deep down inside to finish the job. We've now shed our blood in the city. The last thing we want to do is walk away." ...



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Russia announces Iran's Bushehr reactor is 90 percent finished
MOSCOW -- Russia has completed more than 90 percent of the Bushehr nuclear reactor in Iran. Russian officials said Moscow has accelerated work on the Bushehr power reactor. They said 1,500 Russian nationals and personnel from the former Soviet Union were sent to Iran to complete the $1 billion nuclear project...


PUBLIC PICTURE OF THE WEEK
http://www.globalsecurity.org/military/world/iraq/an-najaf-imagery.htm




Saddam agents on Syria border helped move banned materials
By Rowan Scarborough
THE WASHINGTON TIMES
Saddam Hussein periodically removed guards on the Syrian border and replaced them with his own intelligence agents who supervised the movement of banned materials between the two countries, U.S. investigators have discovered.
The recent discovery by the Bush administration's Iraq Survey Group (ISG) is fueling speculation, but is not proof, that the Iraqi dictator moved prohibited weapons of mass destruction (WMD) into Syria before the March 2003 invasion by a U.S.-led coalition.
Two defense sources told The Washington Times that the ISG has interviewed Iraqis who told of Saddam's system of dispatching his trusted Iraqi Intelligence Service (IIS) to the border, where they would send border inspectors away.
The shift was followed by the movement of trucks in and out of Syria suspected of carrying materials banned by U.N. sanctions. Once the shipments were made, the agents would leave and the regular border guards would resume their posts.
"If you leave it to border guards, then the border guards could stop the trucks and extract their 10 percent, just like the mob would do," said a Pentagon official who asked not to be named. "Saddam's family was controlling the black market, and it was a good opportunity for them to make money."
Sources said Saddam and his family grew rich from this black market and personally dispatched his dreaded intelligence service to the border to make sure the shipments got through.
The ISG is a 1,400-member team organized by the Pentagon and CIA to hunt for Saddam's suspected stockpiles of WMD, such as chemical and biological agents. So far, the search has failed to find such stockpiles, which were the main reason for President Bush ordering the invasion of Iraq to remove Saddam.
But there is evidence of unusually heavy truck traffic into Syria in the days before the attack, and with it, speculation that some of the trucks contained the banned weapons.
"Of course, it's always suspicious," the Pentagon official said.
The source said the ISG has confirmed the practice of IIS agents going to the border. Investigators also have heard from Iraqi sources that this maneuver was done days before the war at a time of brisk cross-border movements.
That particular part of the disclosures has not been positively confirmed, the officials said, although it dovetails with Saddam's system of switching guards at a time when contraband was shipped.
The United States spotted the heavy truck traffic via satellite imagery before the war. But spy cameras cannot look through truck canopies, and the ISG has not been able to determine whether any weapons were sent to Syria for hiding.
In an interview in October, retired Lt. Gen. James R. Clapper Jr., who heads the U.S. agency that processes and analyzes satellite imagery, said he thinks that Saddam's underlings hid banned weapons of mass destruction before the war.
"I think personally that those below the senior leadership saw what was coming, and I think they went to some extraordinary lengths to dispose of the evidence," said Gen. Clapper, who heads the National Geospatial Intelligence Agency. "I'll call it an 'educated hunch.' "
He added, "I think probably in the few months running up prior to the onset of combat that I think there was probably an intensive effort to disperse into private homes, move documentation and materials out of the country. I think there are any number of things that they would have done."
Of activity on the Syrian border, Gen. Clapper said, "There is no question that there was a lot of traffic, increase in traffic up to the immediate onset of combat and certainly during Iraqi Freedom. ... The obvious conclusion one draws is the sudden upturn, uptick in traffic which may have been people leaving the scene, fleeing Iraq and unquestionably, I'm sure, material as well."
He also said, "Based on what we saw prior to the onset of hostilities, we certainly felt there were indications of WMD activity. ... Actually knowing what is going on inside a building is quite a different thing than, say, this facility may well be a place where there may be WMD."
The Iraq Survey Group, which periodically briefs senior officials and Congress, is due to deliver its next report in September. In addition to interviewing hundreds of Iraqis, the ISG has collected and cataloged millions of pages of documents, not all of which have been fully examined.
Although Syria and Iraq competed for influence in the region, they shared the same Ba'athist socialist ideology and maintained close ties at certain government levels. The United States accused Syria during the war of harboring some of Saddam's inner circle.

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>> SEC? WHAT'S THAT?

PINK-SHEETS STRUMPET
By CHRISTOPHER BYRON
August 16, 2004 -- IN Wall Street's house of ill repute, the cop on the beat might as well be the piano player. We're speaking of course of the gang in the front parlor at the Hotel Pink Sheets, which last week brought yet another X-rated example of how the Securities and Exchange Commission keeps missing obvious abuses of the market while claiming to keep the peace on America's street of dreams.
For those of you who may have missed the moment, it was an occasion to cherish, as a seemingly worthless penny stock called Concorde America, Inc., appeared out of nowhere in early July and streaked comet-like across the heavens, soaring nearly 800 percent in value in barely a month, before topping out last Wednesday at $8.90 a share and a market cap of close to $1.9 billion.
What treasure may have lurked in that market cap remains for the moment a mystery ≈ and unless someone begins pouring black coffee down the throats of the SEC's dozing constabulary, it may stay that way forever ≈ even though the contrails of the stock in question spell out "pump-and-dump" in mile-high letters in the sky.
The so-called pink sheets market, named for the pink colored paper on which the quoted daily prices of various stocks were distributed in the pre-computer era, is a gray market arena where the stocks of countless failed companies ≈ many of which no longer bother to report their financial results to the SEC or even their own investors ≈ are nonetheless permitted by the regulators to trade freely anyway.
Think of the Pink Sheets as the stock market's answer to the Hamburg Reeperbahn and you've got the basic idea, for it is here that the downtown hoi-polloi rub elbows with the uptown swells, as each eyes the merchandise for Wall Street's ultimate cheap date: a one-night stand with a non-reporting penny stock.
The hottest tart on the boulevard last week was of course Concorde America, which caught the eye of the johns thanks to a propitiously timed press release that had issued forth from the pen of a self-admiring fellow named Thomas Heysek late in July.
On various of his penny stock Web sites, Heysek is described as an "investment guru" and an "acclaimed" financial expert ≈ such credentialing being presumably sufficient to vouchsafe the accuracy of the assertions in his press releases, the first of which regarding Concorde America appeared on July 28.
The release in question asserted that Concorde America Inc. was soon to emerge as a global player in the business of exporting labor from Latin America to Europe, and that it was destined to bring in revenues of $1.47 billion by the end of 2006 from a single contract with Spain alone.
Heysek's seemingly detailed knowledge of the exciting outlook for Concorde America is puzzling, to say the least, since the company itself turns out to be less than eight weeks old and as of last week appeared to consist of little but an "under construction" Web site and a telephone answering machine at an address in Boca Raton, Fla.
Upon what basis does such an operation warrant the fulsome praise Heysek heaped upon it? Anyone's answer is as good as anyone else's since this is a company that has not yet published any known financial statements, and so long as it remains "in the pinks" will never have to either.
Given the situation presented him, and with due regard for his own ethically challenged past in the stock market, one might easily imagine Heysek to have been tempted to spice up his investment outlook a bit for this mysterious entity.
According to his employment record on file with the National Association of Securities Dealers, Heysek has held five jobs on Wall Street over the past decade, and has been fired from three of them, for offenses ranging from "unsatisfactory sales practices" to "improper handling of customer funds."
AND Heysek certainly stood to gain by jazz ing up his report since it turns out that one of his Web sites (www.winningstockpicks.net) had been paid 25,000 shares of stock in Concorde America to help the company wriggle into its fishnet nylons and slap on some Cover Girl war paint for a bit of the upstairs action.
It was a routine this pink sheets floosie knew well, having previously been shopped around under the name MBC Food, Inc., before which her ID read Fisher Television, Inc., and before that, Storage Systems Inc., in a series of penny stock mergers and stock splits stretching back a decade.
By the time she had morphed into Concorde America, our hustling honey had spread nearly 210 million shares of stock through the market, and by the time Heysek issued his report, those shares had already tripled in value to $3 per share. And further gains ≈ on vastly greater volume ≈ lay just ahead once his press release and its pheromone-like scent of easy money began to lure in the shills.
Who paid Heysek those 25,000 shares? One possible candidate might have been Concorde's skipper, one Hartley Lord, 75, whose residence turns out to located at the same Boca Raton address where the telephone answering machine that looks to be Concorde's principal (and maybe its only) business asset is itself located. In fact, Concorde's business phone number is also Lord's home phone.
But Lord issued a press release of his own last week, disavowing the report and asserting that he had no connection with it in any way ≈ though he did not do so until after the close of business Wednesday, by which time Concorde America's stock price had climbed to $8.90 per share.
But if Lord didn't pay the 25,000 shares to Heysek, then who did? The question has more than merely academic value since scarcely had Concorde's stock price tumbled from $8.90 to $2.50 in the wake of Lord's press release than Heysek reiterated his "buy" recommendation with a year-ahead price target of $36, and the shares started to rise all over again, coming to rest at week's end at $5.
At that price, the collec tive wisdom of the market is proclaiming Concorde America to be a $1 billion company. In fact, of course, it has all the earmarks of a billion dollar pump-and-dump, and though the stock is able to trade only because it has a trading symbol, issued in this case by Nasdaq, only the SEC has the power to halt the trading.
And halting trading in Concorde America's shares is obviously something the SEC should do since this is a company with a $1 billion valuation that appears to be based on nothing but a stock tout's press release, which is being bad-mouthed and disparaged by the company's own top official.
Yet for the last two weeks the gendarmes of the SEC have done nothing but stand by silently and watch as the pumping and dumping has unfolded right under their noses. Why?
For public consumption the regulators will mutter some off-the-record inanity about "investigating" the situation. But in private, they'll tell you what they believe to be the truth ≈ that anyone who visits a brothel checks his complaining rights at the door.
After all, in the Hotel Pink Sheets, isn't getting screwed the whole point of a visit?
Please send e-mail to: cbyron@nypost.com


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>> SOR? - WHAT'S THAT? SAY IT CHEERFULLY "WE COULD SEE $50 OIL..."


Big Oil Protects its Interests
Industry spends hundreds of millions on lobbying, elections
http://www.publicintegrity.org/oil/report.aspx?aid=345
By Aron Pilhofer and Bob Williams
WASHINGTON, July 15, 2004 -- The United States is the oil and gas industry's biggest customer, slurping up fully a quarter of global production in 2003.
Not surprisingly, the industry has lavished more than $440 million over the past six years on politicians, political parties and lobbyists in order to protect its interests in Washington, according to a new report by the Center for Public Integrity.
This is the first of a series of Center reports that aim to identify the size and scope of the international oil and gas industry and measure its influence in the halls of government worldwide.
Among the key findings:
The Center found that the industry has spent more than $381 million on lobbying activities since 1998, pushing hard on everything from a new national energy policy to obscure changes in the tax code.
The industry has given more than $67 million in campaign contributions in federal elections since the 1998 election cycle, about a fifth of the amount it has spent on lobbying.
Oil and gas companies overwhelmingly favored Republicans over Democrats in their campaign giving, the study found. Just over 73 percent of the industry's campaign contributions have gone to Republican candidates and organizations.
The industry exerts its influence in other, less obvious ways, including membership on the National Petroleum Council, a commission formed to advise the energy secretary. Koch Industries, the largest privately-held oil company in the United States, has financed a network of conservative nonprofit organizations designed to influence policy debate in this country.
U.S.-based oil and gas companies have nearly 900 subsidiaries located in tax haven countries, such as the Cayman Islands and Bermuda.
The world's largest oil company and third largest company of any kind, ExxonMobil, was the industry's leader in lobbying expenditures, spending $55 million to plead its case with official Washington over the past six years.
Other big spenders included ChevronTexaco ($32 million), Marathon Oil ($29 million), British oil giant BP ($28 million), and British/Dutch behemoth Royal Dutch/Shell Group ($27 million).
Other noteworthy entries on the list include the top industry group, the American Petroleum Institute ($20 million), and Occidental Petroleum ($12 million).
Some more notorious names on the list include scandal-plagued Enron Corp. ($16 million) and Vice President Dick Cheney's former employer Halliburton Corp. ($3 million), which is currently the subject of government investigations over its contract work in Iraq and alleged bribes paid in connection with a natural gas project in Nigeria.
When it came to tapping the oil industry for campaign dollars, no one has come close to former Texas oilman George W. Bush. The president has received $1.7 million in campaign cash from the oil and gas industry.
That was more than three times the amount given to the next biggest recipient of the industry's largesse, House Energy and Commerce Committee Chairman and fellow Texan Joe Barton, who collected $574,000. Next came another Texas Republican, House Majority Leader Tom DeLay, who took in just under $500,000.
Only three Democrats were able to crack into the top 20 recipients of oil and gas campaign contributions since 1998. All three came from oil-rich Louisiana.
They were Sen. Mary Landrieu, Sen. John Breaux and Rep. Christopher John.
The two national parties each took in more than any individual candidate, national Republican committees getting $24 million and Democrats a bit under $8 million.
While most of the big oil and gas companies operate their own lobbying shops in Washington, the industry also farmed out a substantial amount of its work to some of Washington's largest and most influential lobbying firms.
On the top of that list was Bracewell and Patterson, which has gotten $4,880,000 in lobbying work from the oil and gas industry since 1998.
Among the partners at Bracewell and Patterson is Marc Racicot, the former Montana governor who is the chairman of the Bush-Cheney 2004 election campaign. Edward Krenik, former head of congressional and intergovernmental relations at the U.S. Environmental Protection Agency, is a lobbyist with the firm.
Other top Washington lobbying firms that got work from the oil and gas industry include Hill & Knowlton; Akin, Gump, Strauss, Hauer & Feld and National Environmental Strategies Company.

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>> NASCAR DADS -NOT?


Big Oil Spends $400,000 on Government Junkets
Legislators taken to NASCAR races, "Wildcatters Ball"
By Daniel Lathrop
WASHINGTON, July 15, 2004 -- Since January 2000, the oil and gas industry has spent $393,952 to transport and entertain members and staff of Congress's energy committees and top Energy Department officials in places such as Vail, Colo., London and Hong Kong.
A Center for Public Integrity analysis of trips by congressional and executive branch officials showed that those officials regularly spend time in some of world's most desirable destinations--at industry expense and as a captive audience for industry lobbyists.
The 191 industry-paid trips were divided almost equally among the Energy Department, the House and the Senate.
The champion frequent flyer was former Senate Energy and Natural Resources Committee Chairman Frank H. Murkowski. The Alaska Republican and his personal and committee staff racked up $47,753 in oil industry-funded travel to locations that included Scottsdale, Ariz., Madrid, Spain, and Hong Kong.
Murkowski achieved first place despite leaving the Senate to become governor of Alaska in late 2002.
Next on the list came former House Commerce and Energy Committee Chairman Billy Tauzin, R.-La., ($31,961), Sen. Conrad Burns, R-Mont., ($28,878) and Rep. Barbara Cubin, R-Wyo., ($11,974).
While the largesse is heavily slanted to the GOP, the oil industry did sponsor trips on both sides of the aisle. The Democrats who with their staffs were the biggest recipients of oil trips were: Sen. John Breaux, La., ($11,777), Sen. Tim Johnson, S.D., ($10,456) and Rep. John Dingell, Mich. ($9,750).
Some of the sponsors of the travel are household names such as BP plc. ($11,424), but many of the trips were paid for by much more unfamiliar entities such as the United States Energy Association ($64,871), the Resource Development Council for Alaska Inc. ($36,469), and Moscow International Petroleum Club ($26,651).
Although the names of these organizations may be unknown, those they represent are not. For example, the United States Energy Association counts amongst it members ConocoPhillips, Constellation Energy Group and ChevronTexaco.
The Resource Development Council was founded in 1975 to lobby for what became the Trans Alaska Pipeline System. Its membership includes "businesses and individuals from all resource sectors, business associations, labor unions, Native corporations and local governments."
The Moscow International Petroleum Club is a consortium of Russian and multinational oil firms including the state-controlled Gazprom monopoly, ExxonMobil and Halliburton Company, among others.
In that context, it hardly seems odd that in December 2002, the Club flew two staffers from the office of Sen. Conrad Burns, R.-Mont., to Moscow. The seven day trip was reported as an effort "to promote bilateral oil interests."
Burns spokeswoman Jennifer O'Shea, citing the importance of Russian and Caspian Sea region oil in reducing U.S. dependence on the Middle East, said the two staffers joined Burns at the Club's oil summit during a congressional delegation to Moscow, where Burns gave a speech.
"This trip was valid in terms of both Montana interests and national issues, and for those reasons Senator Burns and two staff members traveled to meet and work with officials concerning the oil and gas industry. We have a strict office policy regarding travel, and Sen. Burns himself signs off on every trip that is taken," O'Shea said in an e-mail.
The Club picked up $10,938 in transportation expenses, $1,600 for food and lodging and $14,113 for unspecified "other" expenses.
In February 2001, the Independent Petroleum Association of America spent $2,906 to fly Breaux to their annual "Wildcatters Ball," where he served as the keynote speaker and was given an award and toasted for his diligent efforts on behalf of the industry.
In March 2003, Citgo Petroleum Corporation flew Rep. John Sullivan, R-Okla., to Dallas to meet with company officials "about Citgo staying in Tulsa," according to a travel disclosure document obtained by the Center.
The one-day trip just happened to fall on the day that Citgo-sponsored racer Jeff Burton competed in the Samsung/RadioShack 500 at the Texas Motor Speedway. Citgo, a subsidiary of Venezuela's state-owned oil company Petroleos de Venezuela S.A., picked up the tab for Sullivan's flight, food and a ticket to watch the big race.
The trip came just days before Sullivan voted with his party to pass the Bush administration's industry-friendly energy policy.
Sullivan's chief of staff said the congressman gives serious scrutiny to any proposed outside travel, generally rejecting trips paid for by those who are not constituents and not relevant to his district. She said Sullivan, like other members, has a policy of paying particular attention to travel requests.
"We don't have a written one (policy)," said Elizabeth Bartheld. "I don't and he doesn't approve of company XYZ taking you to Timbuktu."
For an issue as seemingly important as keeping Citgo in Tulsa, it garnered no mention amongst Sullivan's press releases. Other press releases announced a similar trip to Dallas to meet with American Airlines officials in April 2003 and a February 2003 trip to help dedicate a conservation easement.
At the time, Bartheld said, the possible move was a rumor that Sullivan -- elected in 2002--wanted to investigate.
"They had a (NASCAR) car...and I think they were just trying to show it off and get to know us," she said.
Citgo eventually decided to move the majority of its Tulsa workforce to Houston, but consideration of those plans were not made public until August 2003.
Through a spokeswoman, Sen. Johnson also defended his industry-paid travel.
"The total dollar figure calculated by the Center for Public Integrity includes a trip to Pakistan by Sen. Johnson and his then-legislative director to visit American-owned businesses operating in Pakistan and public officials," said spokeswoman Julianne Fisher. "The far majority of the total is reflective of the airfare cost to Pakistan. All travel conducted by Senator Johnson and his staff is done so as official business and is cleared by the appropriate Senate entities where needed."
Governmental ethics watchdogs say such trips are troubling, even if they appear legitimate. "The question is why isn't Congress paying this," said Bob Stern from the nonpartisan Center for Governmental Studies. "I actually think it's very important that Congress and Congressional staffers attend industry events."

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>> ANOTHER...WHAT - NO LONGER SHOCKED?

Investigative Report: Another Clinton Scandal Coming?
Posted August 13, 2004
By Paul M. Rodriguez
Hillary Clinton is flying high within the Democratic Party as a marquee star that many hope will launch a presidential run in 2008 or 2012 or join up as a vice presidential contender. But previously unknown federal documents outlining potentially serious election law violations could spell trouble for the junior senator from New York and some high-fliers in the Democratic Party.
At the same time, according to legal and federal law enforcement sources who have spoken to Insight on condition of anonymity, the failure to pursue alleged wrongdoing by Clinton's senatorial campaign in 2000 and among a variety of party and White House officials involved in fundraising at the time raises questions about the integrity of the Justice Department which has failed to bring indictments against key players in Hollywood, Washington, New York and Florida despite mounting evidence.
At the center in much of this legal thicket is Peter Franklin Paul, a colorful figure and former international lawyer who spent time in jail in the 1970's for cocaine possession and an elaborate scheme that scammed Cuban dictator Fidel Castro out of $8 million. Paul subsequently became a successful businessman in Miami, Fla., and then in Los Angeles, Calif., where he co-founded along with legendary comic book creator Stan Lee the Stan Lee Media company (SLM).
Paul was indicted in 2001 on a variety of securities and bank fraud charges both in California and in New York stemming primarily from his borrowing money on margined SLM stocks that he used to pay for elaborate luncheons, dinners and an extravagant Hollywood tribute to President Bill Clinton that was tied to a major fundraising event for Hillary Clinton's senate campaign in the summer of 2000.
In all, according to Paul and extensive documents reviewed by Insight, he provided in-kind contributions in excess of $1.7 million to Clinton's campaign that never has been properly accounted for in her Federal Election Commission (FEC) filings. Clinton and her campaign have denied receiving such large contributions from Paul.
Newly obtained documents by Insight raise thorny questions about such denials and separate allegations of a federal cover up at the Justice Department. One such document is an FBI special agent's affidavit from May 2002 that outlined alleged wrongdoing by Clinton's senatorial campaign back in 2000.
A second document is a Justice Department memorandum this June to Federal District Judge Leonard D. Wexler that bolsters the FBI agent's charges from 2002 but adds a surprising twist involving an alleged bribe to Bill Clinton while he was president that certainly will be unwelcome news among many Democrats who have hoped that scandals involving the Clintons were long ago over.
Insight has investigated many of these issues in extensive investigative reports over several years, including the odd omission by federal officials in the indictments concerning the nearly $2 million Peter Paul donated to Hillary Clinton - donations and fundraising activities that, ostensibly, are the root causes for his legal troubles.
The 22-page FBI affidavit, which was signed May 30, 2002, by Special Agent David C. Smith, was in support of a search warrant on a large storage locker rented in Tarzana, Calif., by Paul. The existence of the search warrant was reported by Insight in late 2002, including the FBI's search for records of any type related to Hillary Clinton's campaign.
At the time and ever since, the Justice Department has declined to discuss the reasons behind the search warrant's references to the Clinton Senate campaign leaving Paul as virtually the sole source on claims he had proof at the storage locker that he was the major supporter of various Clinton fundraising events in 2000.
As part of a very public strategy to promote Stan Lee Media, according to Paul in numerous interviews with Insight and in voluminous filings in federal courts and with the FEC since his indictments (one of which was superceded in early August 2004 for a trial in New York), he cut a deal with political aides in the national Democratic Party and Hillary Clinton's campaign to host a variety of political events at expensive restaurants and amongst Hollywood's elite.
Paul also planned, hosted and paid for the bulk of an elaborate star-studded Hollywood gala on behalf of Bill Clinton that was part of a big fundraising event for Hillary Clinton when the Democratic Party was holding its national convention in Los Angeles back in 2000. Not only was Paul publicly thanks by both Clintons for each of these events but also was thanked by Bill, Hillary and even Chelsea Clinton in personal thank you notes.
To pay for all these costs, according to Paul and former Stan Lee Media employees, he borrowed large sums of money on margined SLM stocks - a promotions gamble he was sure would help convince Bill Clinton to become a board member of Stan Lee Media after leaving the White House.
In fact, according to those previously interviewed by Insight and who are not accused of any crimes, Paul often bragged that his contacts with high-level Democratic operatives who recommended his extensive political in-kind contributions would pave the way to get Bill Clinton on the SLM board.
Moreover, several sources also said that Democratic officials and operatives who used SLM's offices to help plan both the gala and the Clinton fundraising events openly spoke about how party officials were grateful for Paul's help and that even President Clinton said he would get some of his friends to invest in Stan Lee Media.
Prosecutors in the Central District of California (Los Angeles) and in the Eastern District of New York have never publicly - either in statements or in the various indictments - mentioned any of these political deals or Paul's substantial in-kind contributions. In fact, prosecutors have said that all of Paul's alleged illegal activities were for his own personal gain and that of his family.
Paul has denied that he is guilty as charged and says he even tried before he was indicted to blow the whistle on wrongdoing at Stan Lee Media as well as a failure by Hillary Clinton to properly disclose his contributions.
The root cause for much of Paul's legal troubles appears to have started once his attempts to recruit Bill Clinton began to run into brick walls, demands for additional contributions to DNC causes kept piling up, and a Washington Post story in late August 2000 uncovered his past criminal convictions.
Once that story ran, both Paul and former associates claim, he publicly was dropped like a hot potato by the Hillary Clinton campaign which also returned a $2,000 contribution he had made. However, according to Paul and former associates, behind-the-scenes contacts continued with DNC officials who continued to seek additional political contributions, as well as the Clinton campaign. The White House even arranged a private tour of Air Force One with President Clinton and then-California Governor Grey Davis weeks after the public distancing from Paul after the Washington Post story ran.
As political pressures mounted through the fall of 2000, according to Paul, troubles at Stan Lee Media were beginning to mount as a result of bad business decisions by his partners, secret stock sales, margin loans and alleged corruption that led to a crash of SLM's stock price. Ultimately, the company crashed and burned, according to the federal indictments, due to Paul's alleged illegal actions.
Initially, according to Paul and his lawyers at Judicial Watch, he didn't think that business troubles at SLM would lead to his indictment but to the indictments of corporate officers, audit committee members and outside advisers of Stan Lee Media as well as some lawyers who had set up the various stock deals that Paul currently is being charged with orchestrating.
In fact, such hopes seemed bolstered by secretly recorded government wiretaps whose transcripts of conversations between Paul and an alleged government informant suggested it was not Paul whom the government might go after but others. Insight has obtained these transcripts.
Confidential FBI 302 reports by a senior special agent in the New Jersey Federal Crime Task Force that start in February 2001 and continuing at least to the end of that March seem to back up many of Paul's claims that he was trying to blow the whistle on corrupt practices at Stan Lee Media and, separately, false FEC filings by the Clinton campaign. Copies of some of these confidential FBI 302 reports were obtained by Insight.
In addition to these memorialized attempts by Paul to work with the FBI without counsel, Paul subsequently retained Larry Klayman at Judicial Watch to formerly document such proffers to federal prosecutors, including allowing high-level Justice Department officials who assigned separate investigators to conduct wiretaps from Paul's Brazilian residence on a key player apparently working undercover for the FBI who allegedly helped to manipulate the demise of Stan Lee Media.
Paul also tried several times to have the Clinton campaign correct its FEC records by offering to share his own records detailing his nearly $2 million in contributions plus separate SLM stock transfers on behalf of the campaign to a state PAC in New York. Not only did the Clinton camp decline to correct the record, so did the FEC.
None of these attempts to reach out and cooperate with federal investigators has ever been mentioned in public statements or court filings by federal prosecutors. Neither has there been any mention of Paul's political gift giving in any of the indictments nor in the indictments of four others also charged with banking and securities violations.
Over the past three years, which have included a couple of years in Brazilian jails pending extradition to the United States that got bogged down in international paperwork, Paul has said that if he is guilty of any wrongdoing that doesn't excuse the government from going after others who, by the standards used against Paul, also should be charged -- despite political fall out involving some important political people.
The more he has pushed his own private cause against the Clintons, however, the more say his Judicial Watch lawyers that federal prosecutors have hardened their position not to deal with Paul despite senior Justice Department officials' assurances they would help given his cooperation with them on various matters, including a probe on an apparent FBI confidential operative gone bad.
This FBI operative, according to Judicial Watch, is Stanley Myatt, a Miami businessman with reputed ties to organized crime who also has been a valuable government undercover operative working with the Customs Service, the FBI, the Bureau of Alcohol, Tobacco and Firearms, the Secret Service, various federal crime task forces and even the CIA. Myatt has declined to speak with Insight but has told others that he is an innocent man.
In June, Robert Sticht, one of Paul's New York defense lawyers, argued in a little-noticed motion that the indictments against his client should be thrown out because of "outrageous government conduct" against Paul that includes the pivotal role played by Myatt in both the demise of SLM and the faulty indictments of Peter Paul.
"Since the early 1970's," Sticht said in his motion, "Myatt has been working as an informant, covert operative, and agent for various government agencies...He has been involved in the government's biggest cases including ABSCAM, BCCI, and the prosecution of successive Philadelphia mob bosses. Investigations Myatt was involved in the past were 'run' by the FBI in a terribly uncontrolled manner, resulting both in breaches of regulations and guidelines by agents, and of the law by the informants."
"While acting on behalf of the government, under cover of investigations, Myatt has been looting public companies," Sticht claims. "The FBI does not pay Myatt for his information and/or investigations. The arrangement is such that Myatt makes his living looting public companies as an agent of the government. In exchange, the FBI makes criminal cases."
It is because of such previously unrevealed allegations involving Myatt that, Insight's sources have claimed, both the Criminal Division and Public Integrity Division at the Justice Department, along with the Office of the Inspector General have been holding secret meetings with Paul's lawyers for the past three years and agreed to launch a behind-the-scenes probe of Myatt and his alleged FBI handlers. This is one reason for the federal wiretaps back in 2001.
In an unrelated Florida court case going back several years involving a defendant who allegedly tried to kill Myatt, the South Florida businessman revealed in a secret in-camera hearing captured on tape that he had worked over the years as a confidential informant for several federal agencies, Insight previously has confirmed.
This is the same Myatt that Paul has claimed pressured him to secretly transfer large blocks of SLM stock to Myatt for financial help. And it's the same Myatt caught on the Justice Department's wiretaps talking with Paul about the then-secret N.J. Federal Crime Task Force probe involving Stan Lee Media, problems others were causing the company, and what the N.J. Federal Criminal Task Force was investigating.
Unbeknownst to both federal prosecutors and the Justice Department, the Internal Revenue Service had opened a local criminal probe in South Florida involving Myatt and many of his companies, including several holding companies offshore. This IRS criminal probe quickly expanded to include Myatt's dealings with Stan Lee Media and questionable stock sales, as well as secret stock transfers by others at Stan Lee Media that were traced in some cases to offshore accounts involving not only Myatt but also some people affiliated with SLM - people that to date have not been charged with any crimes.
Once the Justice Department became aware of the independent IRS probe, according to Insight's sources, the investigation of Myatt has been controlled by the department's Criminal Division because of its "extreme" sensitivity and impact on other investigations still underway, including appeals by some mobsters put away allegedly with Myatt's help in various sting operations.
In the past year, as Insight, the Los Angels Times and Vanity Fair have reported, the IRS not only has expanded its criminal probe involving Myatt to include allegations of wrongdoing at SLM, but so too did the Federal Election Commission and a federal grand jury probing irregularities by both the Hillary Clinton campaign and operatives in the Democratic Party.
Though Peter Paul has not been interviewed by the FBI, the SEC or the IRS he recently has been interviewed by the FEC for 12 hours. The SEC also has conducted extensive interviews with a former associate of Paul's now serving up to seven years in jail for similar charges now pending against Paul.
Aaron Tonken, himself a once high-flying operative in the Democratic Party who is facing his own charges from separate fundraising schemes affiliated with some California charities and Hollywood A-list personalities, also has been interviewed extensively by government agents. Tonken is alleged to have played a significant role in the Peter Paul-connected fundraising events on behalf of the Clintons back in the summer of 2000.
In his May 30, 2002, affidavit in support of the search warrant on Paul's storage facility in California, FBI Special Agent Smith outlined the various allegations involving the Clintons' political and campaign activities:
"In addition to the foregoing, a federal grand jury in the Central District of California is continuing to investigate allegations of violations of the federal campaign finance statues, and of false statements to federal government agencies. In particular, on August 12, 2000, while the Democratic National Convention was underway in Los Angles, [PETER] PAUL was responsible for hosting a fundraising event known as 'THE HOLLYWOOD GALA SALUTE TO PRESIDENT WILLIAM JEFFERSON CLINTON' ("the event"). The event was a fundraiser for the benefit of New York Senate 2000, the campaign organization that supported the United States Senate Campaign of Hillary Rodham Clinton.
"The event's costs exceeded $1 million, but the required forms filed by New York Senate 2000 with the Federal Election Commission ("FEC") months after the event incorrectly disclosed that the cost of the event was only $523,000. It appears that the true cost of the event was deliberately understated in order to increase the amount of funds available to New York Senate 2000 for federal campaign activities."
Agent Smith's sworn declaration also mentions interviews he and FBI Special Agent Kevin J. Horn conducted with several people with first hand knowledge of behind-the-scenes activities associated with the fundraising events, including an apparently false FEC report that SLM, Inc. donated $366,000 to the Clinton campaign - a report that was filed by her campaign committee and, to date, has never been corrected.
Curiously, throughout Peter Paul's three-plus years under federal scrutiny and subsequent indictments and incarceration, federal officials have said little to nothing about their interest in the Hillary Clinton campaign matter. And yet, according to a February 27, 2002 letter from then Assistant U.S. Attorney David Z. Seide to the custodian of records at Blue Room Events in Los Angeles, federal prosecutors at one time were probing deeply to uncover evidence of possible wrongdoing by the Clinton campaign.
A federal grand jury subpoena to Blue Room Events, which provided many of the services to the Clinton gala and fundraiser, outlined requests for records specifically naming Clinton-related staff involved in the events. Insight has obtained this subpoena.
Paul has long contended that the government wants nothing to do with the Clintons or worse, has just covered up what it has found to avoid political fallout that surely would follow were illegal acts prosecuted.
Curiously, federal agents and prosecutors have routinely labeled Peter Paul a liar (among other things) when responding to his seemingly outrageous claims about conspiracies, Myatt, corruption at SLM by company officers and directors, and fundraising irregularities at the Hillary Clinton campaign committee.
Yet, according to the newly obtained FBI affidavit and other documents, it appears some within the FBI and the Justice Department felt there was enough evidence of political wrongdoing to engage a federal grand jury to check out the allegations. What's happened since is unclear involving the FBI and Justice but for certain the SEC, the FEC and the IRS have jumped into the fray.
When asked for comment, the only thing a senior Justice Department official would tell Insight is that if anything does emerge that is illegal involving the Clintons, the senator's campaign, Democratic Party operatives and others affiliated with Stan Lee Media then these will be pursued to the fullest extent of the law. And no, the official said, there are no conspiracies to spike such probes.
Then how, Paul's lawyers ask, does such assurances jive with a July 30, 2004, letter to Judge Wexler from a Catherine L. Youssef, an assistant U.S. attorney in the Eastern District of New York. She said the government was prepared to offer evidence that Peter Paul not only exploited his former company for personal gains but also to underwrite his contributions to the Hillary Clinton campaign, to borrow money from a partner that he "explained that he needed ... for a party for Bill and Hillary Clinton," and that he also "sought to bribe William J. Clinton in order to obtain a presidential pardon for his three prior felony convictions."
Youssef also wrote the judge that "Paul sought to effect this bribe by paying the bulk of the costs of certain fund-raising events for Hillary Clinton's New York Senatorial campaign, by making gifts of jewelry and other curios to Mr. and Mrs. Clinton and by offering to install Mr. Clinton on the board of directors at SLM, after Mr. Clinton left his office as President of the United States."
"In addition," the prosecutor wrote, "to conceal from federal authorities that a convicted felon (i.e. Paul) was making large 'soft money' contributions to the Clinton campaign, Paul paid for the costs of certain fund-raising events using SLM and Stan Lee himself as conduits."
To those familiar with Peter Paul and the political events he underwrote in the summer of 2000, the government's claim that he was concealing his involvement seems ridiculous given the bevy of press reports at the time, Paul's own bragging in public about his involvement, the public and private expressions of gratitude to Paul by the Clintons and last but not least, Paul's many attempts long before he was indicted to reveal all he knew about the apparently false FEC records filed by the Hillary Clinton campaign.
Ironically for Paul, perhaps, is that his many years of being ignored by most press outlets concerning his "outlandish" claims now appear to be supported - to some extent - by the federal government itself. And now those very same claims are being used against him.
Tom Fitton, president of Judicial Watch, said, "Top officials at the Justice Department have assured us repeatedly -- and recently -- that they remain interested in Peter's evidence concerning the fundraising activities involving the Clintons. And they have repeatedly promised to step in on issues concerning Peter's criminal prosecutions in New York and California.
"Michael Chertoff, the former head of the Criminal Division at the Justice Department, also had promised us that he and his office would make the final decisions related to Peter's prosecution. But now after his departure the Justice Department has permitted local prosecutors to re-indict Paul a few weeks ago.
"Besides opposing Peter's bail the Justice Department also is misstating the allegations related to the Clintons - for example, claiming that Peter Paul tried to bribe Bill Clinton and conceal contributions. It's hogwash and they know it," Fitton said.
Meanwhile, in a California civil case brought by Paul against the Clintons (and others), a judge has dismissed attempts by the Clintons to be excluded from his claims of personal injury and legal efforts to recoup his nearly $2 million of in-kind donations he gave to the senator's campaign.
"Absent extraordinary court intervention, this case will move forward and we'll be deposing both Clintons along with a cast of other characters that includes Tonken."
Tonken on the other hand, has told reporters he's been singing to a variety of federal agencies and that he'll help tie up loose ends that lead to very high level people in Hollywood and Washington, including the Clintons. He also has a book coming out later this year, as well as facing up to 87 months in prison.
Paul M. Rodriguez is the Editor of Insight
To read Insight's previous Investigative stories on the Peter Paul saga click hereFall Guy May Turn The Tables

Clintons' Fall Guy May Turn the Tables
Posted Oct. 16, 2003
By Paul M. Rodriguez
The Clintons have tried to distance themselves from Paul, third from left, but this picture at a fund-raiser suggests Bill and Hillary appreciated his political gift-giving.
Peter F. Paul, the flamboyant Hollywood entrepreneur who says Hillary Rodham Clinton has hidden almost $2 million of in-kind contributions he made to her campaign in 2000, is back from Brazil and promising to raise a ruckus about the New York senator as he fights bizarre securities and bank-fraud charges on which he's been indicted. Aaron Tonken, a political operative in Hollywood and a former prot?g? of Paul under indictment for a variety of alleged sharp deals with the rich and famous, also is promising to tell everything he knows about behind-the-scenes shenanigans of Clinton and many others.
Meanwhile, the Securities and Exchange Commission (SEC) and the IRS have embarked on extensive civil and criminal probes involving a cast of Damon Runyon characters and securities, tax and bank frauds that appear to center on a now-bankrupt company called Stan Lee Media Inc. (SLM). That company is in turn at the epicenter of charges brought against Stephen and Jonathan Gordon, Paul and at least two stockbrokers/advisers and alleged mob figures who helped to perpetrate government-alleged frauds that were used to finance political fund raising for Hillary and Bill Clinton.
Professionals at the Justice Department in Washington, along with prosecutors in the Eastern District of New York and the Western District of California (Los Angeles), also are pursuing ongoing investigations stemming from their probes of Paul, the Gordons and others. At least that's what government officials tell Insight when asked about the status of this battery of criminal cases triggered by the Paul et al. indictments issued almost three years ago.
First a recap: Paul and the Gordons were alleged in the indictments to have bilked SLM, Merrill Lynch, U.S. Bank and others out of millions of dollars by floating checks on margin accounts holding SLM stocks for various personal perfidies, with which he says he financed the Clinton fund raising. According to prosecutors, as much as $25 million was stolen or otherwise looted.
Paul, who was in Brazil at the time of his indictment and convinced that the Clintons were out to wreck his credibility lest he become a whistle-blower, decided to fight the charges from South America. Through a series of manipulations he soon was locked up in squalid and dangerous Brazilian jails until extradited recently to Brooklyn, N.Y. The Gordons stayed in California, fought the charges and were convicted this spring of (much) lesser offenses than initially charged. They are appealing. Others indicted in allegedly related schemes have yet to stand trial despite the passage of years.
Tonken was indicted earlier this year on unrelated charges of bilking mostly rich-and-famous types through mail fraud tied to charity events he led as a result of having worked closely with the Clintons and top Democrats in earlier political battles. He claims he has dirt to dish about a number of related high-fliers, including Hillary Clinton and financial supporters of her campaign. Prosecutors are reported to be listening.
Paul charges that the indictments which have kept him in danger in some of Brazil's worst jails were obtained on little evidence as political retribution for his whistle-blowing in early 2001 about the failure of Hillary Clinton and her campaign to report his huge contributions. Stephen Gordon, who was executive vice president of SLM, confirms the in-kind donations to Hillary but side-steps political aspects raised by Paul. Gordon says he can't understand why he was prosecuted for allegedly manipulating the stock of SLM as part of a cash-flow problem even as prosecutors ignored those more senior at SLM and at Merrill Lynch whom he says followed the same procedures and worse - procedures he insists were researched carefully and found to be legal by company lawyers and accountants.
All of these defendants - Paul, the Gordon brothers and Tonken - have raised significant questions and issues concerning monies passed through the once promising SLM Internet company on the one hand, and alleged Clinton connections and abuse of prosecutorial discretion on the other. Despite the hype and rhetoric of prosecutors when these indictments were issued in late summer 2001, except for conviction of the Gordons on the much-reduced charges, little has occurred in the intervening years.
However, since Insight began investigating the Paul/SLM/Clinton connection a year ago [see "Paul Takes the Fall?" Oct. 1-14, 2002], this magazine has obtained volumes of internal SLM records that reveal secret stock transactions and activities by and through offshore companies that either are not referenced in the various indictments prosecutors secured or do not show up in required SEC filings for public companies. Newly obtained documents also show previously hidden deals among top SLM executives that involve insider stock deals, loans and conversion of restricted "144" stocks - unregistered stocks given to insiders - that law-enforcement sources allege show major violations of banking and securities laws not previously disclosed by prosecutors.
According to sources, a key reason for failure by prosecutors to pursue other potential crimes in these cases stems from political concern that to do so would require tracking Paul's claim that his indictments were a Clinton-inspired vendetta to keep him quiet about huge unreported donations to Hillary's campaign that broke the company. That Paul's legal troubles were initiated by a political vendetta is denied by federal officials who nonetheless concede privately that they have steered clear of his significant contributions to Hillary Clinton. Indeed, based on voluminous records obtained by Insight - including canceled checks, bank ledgers and margin-account statements and invoices - there is no doubt Paul funded numerous high-profile and well-reported political events for Hillary Clinton as well as a Hollywood tribute gala for President Bill Clinton.
To meet the increasing demands that he underwrite high-profile luncheons, dinners and galas to raise ever more money for the Clintons, according to Paul he began to borrow ever more heavily against margin accounts that held SLM stock he had received and assigned to shell companies he had created. These are the very shell companies that prosecutors have claimed were used solely for personal gain to defraud stockholders and corporate executives of SLM, as well as financial institutions that handled the checks and managed the margin accounts.
Contrary to claims made in the indictments of Paul and others, however, internal SLM documents - including e-mails, corporate minutes and stock-assignment and transfer records - show SLM executives should have been aware of intricate activities that prosecutors claim Paul et al. orchestrated secretly for nefarious purposes and contrary to corporate interests.
Moreover, documents and interviews further show that many of the activities Paul et al. allegedly engaged in were familiar corporate practice for others at or associated with SLM. This includes apparent efforts to reduce taxes by moving stocks to offshore companies, converting restricted stocks for quick sales and giving stocks to companies that later would lend monies back to SLM. These were reported in SEC filings as private investors without revealing details of the deals.
At the time that Paul paid nearly $2 million worth of bills for Clinton events, SLM was riding high in the tech industry and its stock was stable. However, late in 2000 the value of the stock began to sink on unusual sales from so-called private investors. This prompted the SEC to launch a probe which caused a run and plunge of SLM stocks that led to bankruptcy. Prosecutors claim that it was Paul et al. who orchestrated secretly the demise of the company with a pump-and-dump scheme, though apparently ignoring other insiders who sources say actually did the deals.
"Something stinks," a lawyer for Paul says. It boils down to a theory that exposing the allegedly extended wrongdoing at SLM would require prosecutors to delve into activities by the Clintons and top Democratic political operatives who used SLM as a private piggy bank. Not to mention possible exposure of a confidential informant used by the FBI in unrelated Mafia-type stings, sources confirm. It is a theme about which Vanity Fair reported earlier this year.
One such snarly issue into which prosecutors are accused of not wanting to delve involves demands made on SLM to transfer at least $100,000 worth of company stock as part of an alleged quid pro quo between the Clintons and Paul to enlist Bill Clinton to promote the company after he left the White House. Until recently, Insight could not confirm the alleged demands. However, following up on a Los Angeles Times report this summer, Insight now has obtained internal communications from the Hillary Rodham Clinton for U.S. Senate Committee Inc., the political entity she used to raise funds for her campaign in 2000. These documents, above, appear to confirm the allegations that SLM stock-transfer demands were made and paid.
For example, copies of faxes identified as coming from David Rosen, the national finance director for Hillary Clinton's political organization, do indeed instruct the delivery of $100,000 worth of SLM stock to the Working Families Party in New York state. This was a political-action group that threw support to Clinton's 2000 bid for the U.S. Senate.
In a fax dated Aug. 24, 2000 ("in RE: Stock Transfer"), there is a reference to an Aug. 3, 2000, memorandum from Rosen to Steve Gordon at SLM, in which Rosen reveals the brokerage account for the Working Families Party as Morgan Stanley/Dean Wittier, the account number, and its representative, phone number and address in Staten Island, N.Y. Both documents say at the bottom: "Paid for by the Hillary Rodham Clinton for U.S. Senate Committee Inc. Contributions are not tax deductible for federal income-tax purposes."
The Los Angeles Times has reported that neither Working Families nor others would explain the instructions in this document or say whether the authorized stock transfer actually took place. Nor has Insight been able to confirm that the deal was "done" as handwritten on the Aug. 3, 2000, communication. Political operatives tell this magazine that such schemes often have been used by political campaigns to hide movement of funds between and among various like-minded groups that funnel money for campaign expenses without recording it with the Federal Election Commission (FEC) and thus revealing it to the public.
Although federal prosecutors, both in New York City and in Los Angeles, were told of this purported stock-related deal to support Hillary Clinton's run for the U.S. Senate, sources claim the prosecution did not report it either to the FEC or the SEC. Nor did the federal prosecutors publicly mention any of the Paul political schemes on behalf of the Clintons that were run through his various companies - the very same companies the indictments claimed were involved in defrauding the public and other illegal activities.
Nor do Clinton's FEC records, which are voluminous, show: 1) any tangible benefit to the company from the alleged pass-through of SLM stocks or 2) Paul's nearly $2 million of in-kind contributions. The FEC records do show about $400,000 received during the summer of 2000 from SLM, but both SLM executives and Stan Lee reportedly have denied making any such soft-money contribution. In fact, it was Paul who made the donation, sources say. And, in the cache of documents obtained by federal prosecutors Insight has found records showing Paul "reimbursed" at least $100,000 for the Stan Lee/SLM contribution claimed by Hillary's campaign.
FEC sources have told this magazine that while they are aware of Paul's claims - and documents confirming that he provided nearly $2 million for Hillary-related fund-raising events - they have not moved to reconcile the senator's campaign records. "I can't explain it to you," said an FEC source. That same source said the agency was unaware of the stock transfer to the Working Families Party and confirmed there should have been a record of it. "But there's not one we can find."
Sen. Clinton, who has declined all comment about these matters, previously claimed through spokesmen that she barely knew Paul, and had returned a $2,000 donation he made to her campaign in the spring/summer of 2000, denied he was involved in setting up Clinton fund-raisers, denied he gave huge in-kind contributions and denied having anything to do with Paul and SLM in any way (except for that disputed $400,000, of course).
This is curious given the personal notes signed by Hillary, Bill and even Chelsea Clinton thanking Paul for all his work on Mrs. Clinton's fund-raising events back in the summer of 2000. And despite the numerous e-mails and faxes sent by Rosen, Clinton's national finance director, to Paul and Stephen Gordon at SLM demanding the transfer of at least $100,000 worth of SLM stock to the Working Families Party.
Insight is told that prosecutors thus far have not interviewed other top executives at SLM or expanded their probe to include the political contributions to the Clintons, the SEC recently assigned a special team to review all such allegations. But SEC officials have declined public comment on their preliminary investigation, first revealed by the Los Angeles Times.
"Based on what we've learned recently, it certainly appears far more than a simple case of fraud by one or two people," an SEC insider confides to Insight. "My guess is that we'll be picking up the ball and running fast in very short order" to pursue suspected additional wrongdoing. This would include looking into the stock transfers that appear to have been orchestrated by Clinton's national finance director, to the Working Families Party.
Paul M. Rodriguez is the managing editor of Insight magazine.
email the author
View documents showing details of a Hillary Clinton campaign demand for $100,000 in SLM stock.
Read "Paul Takes the Fall?" from the Oct. 1-14, 2002, issue of Insight.
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>> "Syndromic surveillance" - COOL


Biowar: State health tracking laws limited
By Dee Ann Divis
Senior Science and Technology Editor
Published 8/13/2004 10:46 PM
WASHINGTON, Aug. 13 (UPI) -- Two states have passed laws supporting syndromic surveillance and others are considering measures that would incorporate this method of getting an early warning of disease outbreaks and possible bioterror attacks.
Syndromic surveillance combines information from a variety of sources to uncover emerging outbreaks before they spread too widely. Computers tracking clues, such as a sudden rise in the purchase of over-the-counter medicines, can spot unusual trends before the authorities -- or even the people who are ill -- are aware something may be seriously amiss. Some bioterror agents in particular have initial symptoms similar to a severe cold or other common maladies.
With early warning, based on symptoms and not admissions to the hospital, authorities can move sooner to find and help infected individuals.
The federal government has been supportive of syndromic surveillance as a tool and studies have been under way to judge its effectiveness as an early warning bell. Researchers are looking at different combinations of information from emergency room visits, school or work absences, nurse inquiries and even the amount of cold medication people buy.
The right data and accurate computer modeling, however, aren't the only things that need to be in place to make such monitoring successful. Health surveillance takes place at the state level and some states found they needed to update their laws to put such the programs into action.
To help states, the Centers for Disease Control and Prevention in Atlanta supported efforts to draft model legislation, called the Model Emergency State Health Powers Act. As the name implies, the language dealt largely with emergency powers, such as quarantine and control of medicines, during emergencies like an epidemic or bioterror attack.
"It was drafted in 2001, right after the 9-11 and the anthrax exposures," James Hodge told United Press International. Hodge is executive director of Johns Hopkins Bloomberg School of Public Health and intimately involved with the MESHPA and a second much more extensive model called the Model State Public Health Act.
Language suggested in the two models would give public health authorities the right to gather information from any government agency, healthcare providers and public or private organizations. They draw a clear distinction between anonymous data and information that can be tied to a specific individual. The drafts suggest authorities be allowed to use anonymous data for any purpose. In the case of identifiable information, however, the model suggests the written permission of the subject be required for disclosure, except in the case of a medical emergency or when required by law.
Not all the states are as detailed in their laws on handling potentially sensitive surveillance information. Lawmakers in Indiana and Nevada did not use the draft language, choosing instead to delay work on even the broader guidelines.
Indiana's new law, which took effect this March, gives the State Department of Health authority to begin collecting data "related to symptoms and health syndromes from outbreaks of diseases." The state already had been developing a program with plans to comb sources as well as poison call centers, lab tests and veterinarians. The lawmakers designated personally identifiable information as confidential but left it to the health department to develop the exact rules on how to manage "reporting, monitoring and prevention procedures."
Nevada approved a bill June 9, 2003, that focused heavily on issues surrounding involuntary quarantine and isolation. It contained, however, a directive to develop a system for "syndromic reporting and active surveillance" to monitor the public health. New rules were to be set, the lawmakers said, for when to use the system and who had to supply reports.
According to the Center for Law and the Public's Health, which tracks such state legislation, a number of other states have surveillance laws under consideration. Alaska, California and Washington are pondering new provisions and Texas is weighing a law that would allow drivers license records to be used to locate persons who may be in need of treatment. Other states are considering more narrowly focused provisions. In Hawaii, for example, new legislation is centered on reducing the risk of disease entering the state through its many ports.
Some states, such as Kansas and Mississippi, had legislation pending which died in committee this year.
E-mail: ddivis@upi.com
Copyright ? 2001-2004 United Press International

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>> MEANWHILE IN EUROPE...

CONTACT: Cathy Gwin, NTI 202-415-4810, gwin@nti.org

Black Dawn Nuclear Terrorism Exercise Shows Europe Is Vulnerable; Participants Develop Action Agenda to Prevent Attack In the wake of the Madrid terrorist bombings, leaders from across Europe met Monday to assess the threat of nuclear terrorism and to develop an action agenda to prevent a catastrophic attack, as part of Black Dawn, a scenario-based exercise held in Brussels. In an unprecedented exercise involving approximately 55 officials and experts from 15 countries and half a dozen international bodies, leaders saw how terrorists could acquire highly enriched uranium (HEU) from civilian research reactors in or near Europe, make a crude nuclear bomb, and explode the device near NATO Headquarters. While most exercises focus on what to do after an attack has occurred, the purpose of Black Dawn was to develop recommendations for preventing nuclear terrorism. The full details of the exercise are not being released for security reasons. Participants included European Union High Representative Javier Solana, Ambassador Rolf Ekeus, former U.S. Senator Sam Nunn and current and former senior officials from the European Council, the European Commission, the North Atlantic Treaty Organization and the International Atomic Energy Agency. NATO Secretary General Jaap de Hoop Scheffer was a co-convener of the event. "We are in a race between cooperation and catastrophe," said Senator Nunn, co-chairman of the Nuclear Threat Initiative (NTI). "To win this race, we have to achieve cooperation on a scale we've never seen or attempted before. Terrorists cannot hit the United States without staggering Europe, and they cannot hit Europe without staggering the United States. Our greatest perils are the threats that all nations face together, and that no nation can solve on its own." "The threat of catastrophic terrorism is not confined to the United States or Russia or the Middle East," said the European Union's High Representative Javier Solana. "The new terrorist movements seem willing to use unlimited violence and cause massive casualties. Europe is both a target and a base for such terrorists." Among the themes of Black Dawn were: * The threat of nuclear terrorism is real. A terrorist nuclear attack on U.S. or European interests is consistent with al Qaeda's objectives and its profile. It is well
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within al Qaeda's operational capabilities to recruit the technical expertise needed to build a crude nuclear device. The designs and the non-nuclear components can be easily obtained. Only 25% of nuclear bomb-making material in Russia is under the protection of comprehensive security upgrades, leaving enough poorly secured material to make tens of thousands of weapons. Most of the 130-plus HEU civilian research reactors around the world lack the security measures necessary to prevent terrorist theft or diversion of weapons-usable materials. Once the material is missing, it is difficult - if not impossible - to interdict. Some of the inadequately secured research reactors that use Soviet-furnished weapons-usable uranium are located in and around Europe. * It could happen here in Europe. There are numerous targets in Europe that are attractive to al Qaeda and other extremists. Europe is now a key base of operations and recruiting for al Qaeda -- which has cells in virtually every European country. Moreover, if al Qaeda or another of these groups obtained nuclear materials in Europe, security and logistical concerns could lead them to select a target in Europe, instead of the United States. * We can take concrete steps to significantly reduce the risk of terrorists acquiring nuclear, biological and chemical weapons. The action agenda is clear -- we know where the dangerous and vulnerable materials are; we know what has to be done; and we know how to do it. Prevention is the only answer to dealing with nuclear terrorism; there are no other good options. * Europe has a leadership role to play, in contributing resources, defining the agenda, removing obstacles to implementation, and getting the job done. The world community cannot win this race without a global partnership against catastrophic terrorism. * We need to act now. Terrorists are racing to get nuclear weapons and materials, and we are not yet racing to stop them. Our leaders must acknowledge by their actions, by their resource priorities, and by their cooperation that the threat of catastrophic terrorism is the most likely, most potentially devastating threat we face; that it threatens all of us equally; that it demands urgent action; that it requires a new level of cooperation. Senator Nunn said he believed it was clear to most participants that "the most effective, least expensive way to prevent nuclear terrorism is to lock down and secure weapons and fissile materials in every country and in every facility that has them. No terrorist can launch a nuclear attack without weapon-grade material -- plutonium or highly enriched uranium." Participants voiced support for specific recommendations for action -- by the European Union, NATO, individual European governments, the United States and Russia -- that can be taken now, before an attack occurs, including as top priorities: * Launch a "Global Cleanout" of HEU at research facilities worldwide; * Accelerate efforts to consolidate, secure and eliminate the most dangerous materials, such as HEU and plutonium; * Accelerate the consolidation of Russia's nuclear weapons stockpile;
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* Expand efforts to employ former weapons scientists and personnel; * Increase transparency and accelerate destruction of tactical nuclear weapons; * Drastically increase and accelerate funding for chemical weapons destruction; * Establish a truly global partnership to reduce the risk of weapons of mass destruction, specifically bioterrorism; * Engage in biosafety/biosecurity confidence-building measures with Russia; * Strengthen international nonproliferation regimes and work toward their universal implementation; * Enhance and expand export controls; * Build national and international capabilities for detecting and interdicting weapons of mass destruction; * Establish international mechanisms for information sharing and crisis management; and * Improve counterterrorism measures, specifically by adding all countries to the international passport control database and by beginning a regular pattern of anti-terrorism exercises focused on missing material or missing weapons. The exercise was sponsored by the Strengthening the Global Partnership project, a consortium of 21 research institutes in 16 European, Asian, and North American countries. The Project is led by the Center for Strategic and International Studies and is supported by the Nuclear Threat Initiative, a charitable organization working to reduce the threats from nuclear, biological and chemical weapons, co-chaired by Ted Turner and Sam Nunn. ### www.nti.org
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Louisiana North
Why New Jersey is a pit of corruption.
Monday, August 16, 2004 12:01 a.m. EDT
There is a real story in the personal and family tragedy surrounding James McGreevey's decision to resign as New Jersey's governor on Thursday. There's also a story in the difficulties of someone being gay and holding high public office. But the bigger story here isn't about Mr. McGreevey. It's about how the elites of a major state, one with the nation's second-highest per capita income and one of its most educated and skilled work forces, have allowed it to be so poorly governed by both parties over a span of decades.
New Jersey's political corruption has been legendary since the days of the late Mayor Frank Hague, who ran Jersey City for 30 years with such an iron fist that he told federal officials "I am the law." Just two years ago, Sen. Bob Torricelli had to drop his re-election bid after the Senate Ethics Committee detailed his improper relationship with a donor. A spineless state Supreme Court allowed Democrats to replace him on the ballot even though a firm deadline for doing so had passed. The state's politics are awash in allegations of conflicts of interest, raids on public treasuries and corrupt alliances between favored business interests and local officials.
Mr. McGreevey, a former mayor of Woodbridge, became governor in 2002 pledging to "change the way Trenton does business." Ross Baker, a professor of political science at Rutgers, says that McGreevey promise "was the second most unfortunate utterance by a modern politician, after the first President Bush saying, 'Read my lips.' "
Indeed, Mr. McGreevey accomplished the remarkable feat of lowering ethical standards in the state capital. The McGreevey administration was stuffed with hacks and yes-men, and within months two of his aides had to resign after scoring millions of dollars in suspect profits on an outdoor billboard deal. Joseph Santiago, his appointee to head the state police, had to resign after it was revealed he had a criminal record and alleged relationships with mobsters. The governor himself was tape-recorded in one meeting with a principal in a fundraising scandal using the word "Machiavelli," which prosecutors say was a code word for a bribery scheme.
Just last month, prosecutors announced that Charles Kushner, Mr. McGreevey's top donor, was being charged with hiring prostitutes to entrap a witness and obstruct a federal investigation. It was Mr. Kushner who sponsored Golan Cipel, an Israeli poet and PR flack, to enter the U.S. In 2002, the governor appointed Mr. Cipel head of the state's homeland security efforts, starting a chain of events that culminated in Thursday's resignation announcement.
In the end, Mr. McGreevey had become a political shape-shifter, an unprincipled and voracious fund-raiser who was easily the East Coast equal of Gray Davis. To pay off all the favors he owes, his latest $28 billion budget includes a 17% spending hike, the largest in state history. The state's top marginal income tax rate is going up by 41%--to 8.97% from 6.37%--at the same time the two top rating agencies have downgraded New Jersey's bond rating because of repeated borrowing.
"They raised taxes, but instead of balancing the budget, they're borrowing and accelerating spending," says Richard Raphael, executive managing director of Fitch Ratings. Last month, the state Supreme Court declared the latest borrowing tricks unconstitutional.
How did the nation's ninth-largest state compile such a record of mismanagement and corruption? Traditional explanations include the fact that the state is dominated by the huge broadcast markets of New York and Philadelphia, voters get shortchanged on local Jersey news. Others blame the state's Byzantine proliferation of hundreds of self-governing towns, which they say allows the perpetuation of local machines. The electorate also bears part of the blame. Philadelphia Inquirer columnist Alan Caruba says that "something is terribly wrong with voters who have demonstrated a virtual death wish so far as any sensible governance of the state is concerned."
Here are some other culprits:
* The media. Several papers reported on Mr. Cipel's mysterious influence over Gov. McGreevey, but they underplayed the matter. Bob Tennant, editor of the Trentonian, insists that "there was nothing concrete that we could put in the paper" about the nature of the relationship. Others aren't so sure. Steve Adubato, a former Democratic state legislator and current host of a PBS public-affairs show, told Fox News's John Gibson that journalists did not pursue the Cipel story aggressively enough because "we were afraid of being accused of being homophobes and we were wrong for doing that."
* The state's imperial structure. New Jersey's post-New Deal constitution made the state's governor what columnist George Will calls "an American Caesar." As the only statewide elected official, he appoints the attorney general, the treasurer, all the county prosecutors and almost all the judges. When Mr. McGreevey leaves office, state Senate president Richard Codey will become acting governor, but he will also keep his old job, thus allowing him to control both the executive branch and half the legislature.
He will be able to do this because the state also has a bizarre law that allows New Jersey officials to hold two elected positions at the same time. Sharpe James, the closest thing the state now has to Frank Hague, is both mayor of Newark and a state senator. Before Mr. McGreevey became governor he served as both mayor of Woodbridge, the state's sixth-largest city, and in the state Senate. The arrangement invites conflicts of interest and corruption.
* The minority party. Republicans are too often part of the problem in New Jersey, and too rarely part of the solution. In 1991, the party won more than two-thirds of the state Legislature in a voter revolt against then-Gov. Jim Florio's tax increases. In 1993 the GOP won the governorship with a pledge to cut income taxes 30%. After honoring that pledge, Republicans decided that rather than drain the Trenton swamp they would turn it into their own private hot tub.
Spending and state mandates on local government ran rampant, as Gov. Christie Whitman sanctioned a tripling of the state's debt. Her plan to reform auto insurance was strangled in its crib by trial-lawyer Republicans in the Legislature. Under pressure from lobbyists, less than half of the state's Republican legislators honored a party pledge to pass the right of initiative and referendum that voters in 23 other states have. "If I&R had won, the investment lobbyists had made in having legislators see their way would have been threatened," said John Budzash, a founder of Hands Across New Jersey, which collected one million signatures backing I&R, only to have them ignored by legislators. Small wonder that Jersey Republicans saw their legislative majorities shrink in five consecutive elections until they lost control of both houses in 2003.
The party has learned few lessons from that experience. Don DiFrancesco, who served as acting governor for a year after Ms. Whitman's departure, is already talking about making a comeback even though he had to withdraw from the GOP primary in 2001 under an ethical cloud. The party's establishment sometimes seems to spend as much time attacking Bret Schundler, a conservative former Jersey City mayor who was the party's nominee for governor in 2001, as it does Democrats. "In New Jersey, the tax recipients are more organized than the taxpayers," Mr. Schundler says. He is planning another run for governor next year if Democratic plans to scotch a special election to replace Mr. McGreevey succeed.
* The county chairmen. New Jersey is a machine state, and the center of its boss rule are the party chairmen, who dominate local politics in the state's 21 counties. They wield huge influence and can and do usually block the candidacies of independent-minded reformers who want to change things in Trenton. Nearly two-thirds of the GOP county chairmen work for state or local government. In a twist common to dying machines, the county chairmen sometimes seem more afraid of reform than losing to Democrats.
Gov. McGreevey's resignation may create a rare opening for change. Many New Jersey residents of both parties share a disgust at being continually stiffed by the politicians. The current scandals should give them all the indignation they need to demand change.

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>> IS ALLAWI LION AND FOX?


The Bush-Kerensky Government of Iraq
Aug 15, 2004
The Bush-Kerensky Government of Iraq
On August 8 this column offered the opinion that the new government in Iraq must use extraordinary force to disarm the milita of Moktada al-Sadr and kill the rebellious Shiite cleric, if it is to survive.
Recent reports from Iraq indicate that Shiite members of the Iraq legislature have protested such a policy, and demanded that the government use peaceful means to a negotiated settlement.
The Iraq government conceded to members of the Iraq legislature and the ministrations of the United Nations.
We are now compelled to believe that the government of Iraqi Prime Minister Iyad Allawi will fall, and that Iraq will be thrown into civil war. The historical parallel is the Alexander Kerensky government of Russia of 1917.
Kerensky, premier of Russia in 1917, gave an opening to a coup d▓etat by the Bolsheviks under Lenin through his liberal democratic policies.
When Czar Nicolas of Russia ceded to Constitutional forces, a new government under Kerensky was established≈the first democratic government of Russian until the fall of the Soviet Union in 1991. Kerensky▓s government failed because it truly believed that it was necessary to adhere to principles of democracy, political freedom and civil rights≈before civil order was restored, and the threat of revolution stilled.
In a time of civil war, or civil unrest such as exists in Iraq today, precisely the opposite is required. Just as Abraham Lincoln put Constitutional rights on hold throughout the American Civil War, the government of Iraq must impose authoritarian rule≈or end up like Kerensky.
To some extent this outcome was ordained by the ⌠white glove■ American regime established by Paul Bremer that sought to establish a constitutional regime in Iraq before the end of civil unrest. Americans seem to believe the rhetoric of ⌠democracy,■ even when circumstances scream for response to disorder that restricts political freedom until order is restored. This ⌠establishment■ approach to foreign affairs is the hallmark of East Coast liberals like the elder George Herbert Walker Bush, and appears to have been transferred to his otherwise more conservative son.
Somewhere in the Bush White House, perhaps in the Oval Office, is a person or persons whose political experience reflects the school of thought of an older, more liberal, generation than the President▓s. Consider the appointment to the 9/11 Commission of liberal Republican Gov. Tom Kean of New Jersey; the choice of Nixon-era statesman Dick Cheney as Vice President, and Kissinger acolyte Paul Bremer, not to mention liberal ⌠statesman■ Colin Powell.
Students of air disasters tell us that no one decision leads to disaster, but, rather a thread of small errors leads to ultimate disaster. The new, soon to fail, regime of Iraq should not be called the Allawi government, it should be called the Bush-Kerensky Government of Iraq. Unless it does something extraordinary, which is to ask the American government to take down the militia of Moktada al-Sadr.

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Two Election Workers Killed in Afghanistan
Two Election Workers Killed in Afghan Ambush; U.S. Urges Government Action on Slain Relief Workers
The Associated Press
KANDAHAR, Afghanistan Aug. 7, 2004 -- Gunmen ambushed a convoy carrying election workers into a remote Taliban stronghold, killing two of them, officials said Saturday, bringing to a dozen the number of people slain so far while preparing for the landmark presidential vote.
Meanwhile, the U.S. military urged the Afghan government to take "immediate action" to find those behind recent deadly attacks on relief workers that have further restricted reconstruction efforts.
At least 30 militants shot at the jeeps from the joint Afghan-U.N. electoral body on Friday as they passed through Char Cheno, a district of central Uruzgan province, Gov. Jan Mohammed Khan told The Associated Press.
Khan said two members of the voter registration team were killed and all four vehicles were destroyed by fire after being strafed with assault-rifle and machine-gun fire.
The United Nations identified the victims as Mohammed Hashim, a training officer, and driver Mohammed Hussein. A third worker was missing, it said.
The world body "condemns in the strongest terms the murderous attack," spokesman Manoel de Almeida e Silva said.
Khan said guards in the convoy returned fire before the assailants retreated. One Taliban fighter was captured, he said.
Uruzgan and neighboring Zabul have been the scene of some of the worst fighting in recent months, and attacks have increased as the nation gears up for its first post-Taliban election on Oct. 9.
Six American soldiers were wounded, two of them seriously, in Zabul on Friday when insurgents mounted attacks with a mortar and explosives, the U.S. military said. The military on Saturday corrected an initial count of eight wounded soldiers.
In one of the attacks, insurgents attacked a 10-vehicle convoy near Daychopan, a notorious trouble spot, with a truck-mounted mortar. One vehicle was hit, wounding four soldiers, Maj. Scott Nelson, an American spokesman, said. U.S. troops returned fire, wounding and capturing two of the assailants before the rest retreated.
Two of the soldiers were treated and returned to duty. The other two were in stable condition and would be flown to a military hospital in Germany, Nelson said.
Rebels also set off a roadside bomb near Zabul's provincial capital, Qalat, as another Humvee was passing. Two soldiers were injured, but quickly returned to duty.
Twenty-one American soldiers have died in action this year, already the worst tally for the U.S. military since it entered Afghanistan in 2001.
The toll on aid workers is higher still, after the execution-style slaying on Tuesday of two Afghans from the German relief agency Malteser Germany in southeastern Paktia province brought the total to 24. It was unclear who carried out the killing, but aid officials have dismissed police suggestions that the motive was robbery.
The incident follows the June 2 killing of five workers from Medecins Sans Frontieres in a previously peaceful northwestern province which prompted the medical relief group to withdraw from Afghanistan after 24 years.
MSF, whose name in English is Doctors Without Borders, said it was dismayed at the failure to arrest local commanders suspected in the killing and the U.S. military said Saturday that it too expected more.
"Senseless acts of violence like the ones against Malteser and Medecins Sans Frontieres ... require immediate and deliberate action to bring those responsible to justice," Nelson said.
Malteser Germany and the U.N. refugee agency, which were working together on project to help former refugees, have suspended operations in the region.
Copyright 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
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>> "Mafia con Peque?os Obst?culos" - COMO?

Mafia con Peque?os Obst?culos
Nuestra herencia cultural es arca abierta
Aunque casi toda legislaci?n proh?be la venta y regalo de piezas arqueol?gicas, contin?a impune el tr?fico de patrimonio cultural. La Interpol estima en 5.000 millones de d?lares anuales el valor del comercio ilegal de estas obras.
Jos? Antonio Pastor
Tiempos del Mundo
El tr?fico internacional de piezas arqueol?gicas es uno de los grandes problemas de Latinoam?rica. La Organizaci?n de las Naciones Unidas para la Educaci?n, Ciencia y Cultura (Unesco, por sus siglas en ingl?s), sostiene que s?lo es superado por el trasiego de armas y de drogas.
Si bien Bolivia, Per?, Chile y Argentina son los pa?ses m?s afectados por estos saqueos, no hay naci?n que haya podido escapar de este flagelo, que tiene en Estados Unidos y Europa sus principales destinos. Todo empieza con alg?n lugare?o, a quien determinada persona de la ciudad le promete un dinero extra si le consigue piezas de valor de los sitios arqueol?gicos de la zona. Como la vigilancia es m?nima, estos tipos no encuentran muchos problemas para acercarse a las tumbas.
En algunos pa?ses se han tratado de implementar mayores y mejores sistemas de control, pero la falta de presupuesto ha representado un obst?culo insalvable, por lo que los objetos robados terminan finalmente en manos de mayoristas que ya tienen varios compradores potenciales en el viejo continente.
Sacar las piezas del pa?s de origen es una tarea sencilla: la falta de capacitaci?n de las autoridades aduaneras facilita buena parte de la misma, pues se les hace ver que se trata de artesan?as o de r?plicas, y parte sin novedad.
Con el fin de frenar el comercio il?cito de estos bienes culturales, la comunidad internacional de profesionales del patrimonio recientemente hizo p?blica la llamada Lista Roja de bienes culturales latinoamericanos en peligro.
Esta lista contiene ejemplos de categor?as espec?ficas de patrimonio cultural precolombino y colonial que son objeto de saqueo y tr?fico ilegal. Vajillas policromas mayas, keros de madera incas, vasos ceremoniales tejidos de plumas nazca y piedras de moler escult?ricas, son algunos de los 25 ejemplos de piezas que suelen ser sustra?das para satisfacer la creciente demanda de antig?edades.
Dicha lista fue establecida en abril de 2002 en Bogot?, Colombia, por un grupo de profesionales de museos y del patrimonio, provenientes de toda Am?rica y de Europa. Su creaci?n representa un llamado a los compradores potenciales para que se abstengan de adquirir estos objetos. Tambi?n est? hecha para ayudar a los agentes de aduanas, a la Polic?a y a los negociantes de arte a identificar las preciadas obras.
Un combate desigual
La Unesco define el patrimonio cultural como los objetos que, por razones religiosas o profanas, han sido expresamente designados por cada Estado como de importancia para la arqueolog?a, la prehistoria, la historia, la literatura, el arte o la ciencia.
Es as? como el producto de las excavaciones, tanto autorizadas como clandestinas, al igual que los elementos procedentes de la desmembraci?n de monumentos art?sticos o hist?ricos y de lugares de inter?s arqueol?gicos, deben ser protegidos por los gobiernos para evitar que se repitan sucesos como el del 8 de agosto de 1985, cuando en Argentina fue rematado en una subasta el cuerpo momificado de una ni?a inca de cinco siglos de antig?edad, hallado cerca de Cafayate, provincia de Salta.
Dos anticuarios de San Telmo compraron la momia en 55 d?lares, pero el director del Museo privado Chavin de Huantar logr? canjearla a los anticuarios por unos cuantos objetos, cuando ya un franc?s y un japon?s ten?an planes de comprarla y sacarla del pa?s.
La convenci?n de la Unesco sobre los medios para prohibir y prevenir la importaci?n, exportaci?n y transferencia de propiedad ilegal del patrimonio cultural, es un acuerdo legal internacional que contiene una reglamentaci?n y regulaci?n respecto del comercio de los bienes culturales de los diferentes pa?ses. Describe un n?mero de medidas por las que los estados miembros se citan para realizar los esfuerzos necesarios para disminuir y controlar el tr?fico il?cito de bienes culturales. Este acuerdo ha sido firmado por 88 naciones.
Sin embargo, son pocas las que han podido hacerle frente a este problema y sus logros son m?nimos, como se puede corroborar en los medios de comunicaci?n.
Hace unas semanas Estados Unidos le devolvi? a Guatemala dos docenas de artefactos mayas luego de una brega judicial que dur? seis a?os; las autoridades aduaneras de Per? decomisaron cinco calaveras momificadas pertenecientes a una cultura preincaica y las autoridades espa?olas anunciaron el decomiso de 228 reliquias arqueol?gicas mayas y aztecas, sacadas de contrabando desde Nicaragua. Utensilios de piedra, piezas de jade, vasijas policromadas, copas ceremoniales, objetos rituales, figuras, collares y ocarinas forman parte del milenario bot?n, cuyo precio art?stico e hist?rico es incalculable, pero que en el mercado negro podr?a cotizarse en m?s de 1,7 millones de d?lares.
Expertos espa?oles del Museo de Am?rica, en Madrid, reci?n valoraban el estado de las piezas decomisadas en junio pasado. La operaci?n de rescate se inici? luego de detectarse --en el aeropuerto madrile?o de Barajas-- unas piezas con facturas falsas que eran declaradas como artesan?as. Las autoridades de los dos pa?ses trabajaron en las investigaciones que condujo al decomiso de los objetos, en poder de dos m?dicos espa?oles colaboradores de un organismo no gubernamental.
Nicaragua sigue indagando sobre este contrabando de piezas arqueol?gicas, pues calcula que m?s de 480 piezas fueron sacadas del pa?s rumbo a la madre patria.
El ex director de Patrimonio Cultural de Nicaragua, Salvador Baltodano, sostiene que en el pasado muchas acciones contra el patrimonio arqueol?gico quedaron impunes. "En realidad, es de nueva data el que las autoridades policiales tengan un mayor involucramiento en la persecuci?n del delito de tr?fico y destrucci?n del patrimonio cultural nicarag?ense", coment? el ex funcionario.
Baltodano, abogado, especialista en derecho de autor, explic? a Tiempos del Mundo que existen actos, tanto de los particulares como de entidades, que pueden ser perfectamente catalogados o tipificados como poderosas presunciones que ri?en con la ley. "Cuando las personas naturales se niegan a presentar inventario de piezas arqueol?gicas bajo su posesi?n, cuando las empresas o entidades publicas o privadas que por su naturaleza o misi?n est?n relacionadas con el impacto del subsuelo, omiten solicitar el permiso de ley de la Direcci?n de Patrimonio Cultural de la Naci?n con relaci?n a los trabajos de impacto que planean realizar, nos encontramos ante una evidencia poderosa de ocultamiento o presunci?n de tr?fico o da?o que debe involucrar sanciones econ?micas y penales, seg?n sea el caso", a?adi?.
La admisi?n o tolerancia de estos actos il?citos por parte de las autoridades conlleva, o puede desencadenar, una serie de perniciosos efectos, como, por ejemplo, la ausencia de una valoraci?n social de respeto por lo propio.
El experto se mostr? preocupado por el comportamiento que se da en algunos pa?ses que han desarrollado legislaciones fuertes para proteger los bienes culturales que configuran su perfil nacional, pero se guarda silencio cuando los traficantes de piezas o bienes culturales de todo tipo las ofertan en el Internet con indicaci?n de ser reci?n desenterradas.
En Nicaragua, a pesar de que la Ley de Protecci?n al Patrimonio Cultural de la Naci?n es bastante clara en cuanto al tr?fico de piezas arqueol?gicas y en la identificaci?n del Estado de Nicaragua como su ?nico propietario, las autoridades se muestran confundidas o indecisas en la aplicaci?n de la norma cuando se incautan este tipo de bienes a presuntos coleccionistas que confiesan que planeaban sacar las piezas arqueol?gicas. "Estos infractores en buen n?mero son extranjeros provenientes de pa?ses en los que por los delitos de tr?fico il?cito y da?o al patrimonio nacional estar?an privados de libertad o, en el mejor de los casos, enfrentando fuertes sanciones econ?micas", finaliz? Baltodano.
La lucha por la repatriaci?n
El pasado mes de abril, el Secretario Asistente del Departamento de Seguridad Nacional de Estados Unidos, Michael Garc?a, devolvi? 41 artefactos precolombinos valorados en m?s de un mill?n de d?lares a Eduardo Ferrero, embajador peruano en el pa?s.
Los objetos pertenec?an a las culturas Mochica, Chimu y Chancay, y se estima que los m?s antiguos datan del a?o 1530 a.C. Al igual que estas 41 reliquias, cientos de elementos precolombinos de diversas culturas llegan a Estados Unidos anualmente para ser vendidos en subastas o convertirse en piezas de colecci?n. En septiembre de 2003, el gobierno de Honduras recibi? 270 artefactos pertenecientes a la cultura maya obtenidos ilegalmente por un comerciante de Ohio y un ciudadano guatemalteco. Seg?n manifest? el co-administrador del Departamento Internacional de Arte y abogado de la firma neoyorquina Herrick Feinstein, Howard N. Spiegler, el tr?fico ilegal de objetos arqueol?gicos es un serio problema en esta naci?n.
"Es imposible establecer una cifra exacta o aproximada de la cantidad de objetos que entran ilegalmente. Pero dada la proximidad a pa?ses ricos en piezas precolombinas, el poder adquisitivo y la cantidad de coleccionistas interesados en tales materiales, no ser?a descabellado afirmar que Estados Unidos es uno de los destinos y mercados principales de propiedad cultural robada en el mundo, ciertamente el m?s importante de las Am?ricas." El problema de tr?fico es "delicado y complicado", pues la ?nica forma en la que el gobierno de un pa?s puede reclamar obras arqueol?gicas robadas es si prueba que ?stas pertenecen al gobierno en cuesti?n, o sea, ampar?ndose en leyes de propiedad.
No obstante, aclara que las cortes estadounidenses no tienen la obligaci?n de hacer cumplir las leyes de exportaci?n de otros pa?ses, que generalmente proh?ben la salida de estas piezas del territorio nacional. "Por eso, es crucial que las leyes de propiedad de cada pa?s sean claras, pues bajo el reclamo de violaci?n a leyes de exportaci?n, tienen el caso perdido y, generalmente, es m?s complicado probar que un artefacto fue robado de un pa?s en espec?fico si este objeto no ha sido catalogado", se?al? el abogado.
Para remediar esta situaci?n, Estados Unidos ha establecido una serie de medidas bilaterales con varios pa?ses ricos en propiedad cultural para hacer valer autom?ticamente un c?digo internacional de leyes de exportaci?n.
Pero estas medidas preventivas son relativamente nuevas, pues en 1970 EE.UU. se adhiri? a la Convenci?n de la Unesco para prohibir y prevenir la importaci?n, exportaci?n o transferencia il?cita de propiedad cultural. Sin embargo, no fue hasta 1983 que el Congreso norteamericano aprob? la Ley de Aplicaci?n de la Convenci?n sobre Bienes Culturales, la cual permite que este pa?s imponga restricciones de importaci?n al material arqueol?gico o etnol?gico cuando el saqueo de dichos materiales pone en riesgo el patrimonio cultural del pa?s.
Seg?n fuentes de la Divisi?n de la Protecci?n Internacional de Bienes Culturales del Departamento de Estado (Usds, por sus siglas en ingl?s), a?n sigue siendo relativamente sencillo traer propiedad cultural a territorio estadounidense, pues quedan pa?ses, como Venezuela y Paraguay, que no pertenecen al acuerdo internacional de la Convenci?n de Unesco, y otros, como Per?, se adhirieron a dicho acuerdo en los a?os 90.
"El Usds cuenta con mejores probabilidades de detectar el tr?fico ilegal de propiedad cultural", afirma el portal de Internet de la Divisi?n de la Protecci?n Internacional de Bienes Culturales. No obstante, "las restricciones no son aplicables a bienes que han salido del pa?s de origen antes de que dicha restricci?n haya entrado en vigencia", por lo que cualquier artefacto que haya llegado a Estados Unidos antes de 1983 o antes de que cualquier otra naci?n haya firmado el acuerdo bilateral no puede ser repatriado bajo la ley de la Convenci?n sobre Bienes Culturales.
"El Departamento de Estado trata de hacer su parte, pero es imposible que los agentes aduaneros detecten todos los objetos importados ilegalmente que entran en territorio estadounidense", dijo Spiegler, quien represent? exitosamente a la Rep?blica de Guatemala en 1998, ayudando a ese pa?s a recuperar un monumento maya robado hace m?s de 30 a?os. "Pero Estados Unidos entiende la responsabilidad que le recae y es justo reconocer que est? haciendo todo lo posible por frenar este tr?fico que supone la destrucci?n del pasado de muchas culturas latinoamericanas."u
Colaboraron en esta investigaci?n Jorge Luis Oliver (Estados Unidos), R?ger Su?rez (Nicaragua) y Ana Paula Valverde (Costa Rica).
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>> PRESSURE - REALLY?
http://www.moretothepoint.com/
Terrorism, Politics and Justice in Pakistan and Afghanistan listen
Pakistan has been arresting al Qaeda suspects in the war on terror, but it▓s no closer to Osama bin Laden. Today▓s Los Angeles Times says, that▓s despite the FBI▓s ⌠crucial role■ in helping intercept cell phone calls and provide other assistance. The story repeats what the US has previously denied, that the Bush administration wants Osama before the November election. As low level suspects are being rounded up, why is Osama so illusive? Meanwhile, in Afghanistan, the trial of three Americans accused of torture and hostage-taking has resumed. The main defendant is Jonathan Idema, who has told reporters his mission was approved by the Pentagon, a charge the Defense Department denies. Warren Olney updates both stories with reporters, experts in foreign policy, and a former official of the National Security Council.

Pakistan arrests 63 al-Qaida suspects
By Anwar Iqbal
UPI South Asian Affairs Analyst
Published 8/16/2004 7:24 PM
WASHINGTON, Aug. 16 (UPI) -- Pakistan seems to be moving toward a head-on collision with al-Qaida and its Pakistani sympathizers in arresting 63 suspects thought to be linked to the extremist network.
In a surprise announcement Monday, the country's interior minister blamed Pakistan's largest religious party, the Jamaat-e-Islami, for harboring al-Qaida suspects.
Faisal Saleh Hayat also said that since early July, Pakistan has arrested 63 al-Qaida suspects, including 12 foreigners and 51 Pakistani nationals. "At least 20 people have also been arrested for attempts on President Pervez Musharraf and on (Pakistan's Prime Minister-designate) Shaukat Aziz," he told reporters in Islamabad.
Hours later, Musharraf -- who has survived at least three serious attempts since joining the U.S.-led "war on terror" -- also appeared on state television in a live interview with a group of senior Pakistani journalists and urged his nation to battle al-Qaida and other terrorist groups.
"Please rise against these obscurantist forces, help me in curbing them," said Musharraf in a live interview. "We have to bring sense into them."
Musharraf said that al-Qaida suspects are escaping their tribal hideouts to Pakistani cities and to destinations outside Pakistan.
The Pakistani leader said his government was determined to "finish the terror threat."
In June, the Pakistani military launched a major offensive against al-Qaida and Taliban hideouts in a tribal zone bordering Afghanistan. More than 100 Pakistani troops and dozens of militants have so far been killed in the ongoing offensive.
"When we began shelling their mountain hideouts, they escaped to the cities. Some of them also escaped to places outside Pakistan," said Musharraf.
"Three Uzbek (al-Qaida suspects) were arrested covered in burqa (a head-to-toe veil) posing as women," said Musharraf, who then urged al-Qaida not preach their brand of religion in Pakistan.
"We are all Muslims, please do not make us more Muslims," he said. "Maybe, you need to become better Muslims."
Musharraf rejected the suggestion that he was fighting al-Qaida to please America. "It is disgraceful to say that I get instructions from America -- that we are conducting the operation against al-Qaida on America's order."
His government, he said, was fighting al-Qaida because it was in Pakistan's interests to do so.
Earlier, Hayat said many of the 51 Pakistani suspects now in police custody were held for sheltering al-Qaida operatives and some of them were from the Jamaat.
"The Jamaat has to explain this to the nation," said Faisal Saleh Hayat, while blaming the party for hiding at least two physicians and a woman suspected of links to al-Qaida.
Although he did not identify them, in a report published on Aug. 11, United Press International identified the physicians as Akmat Waheed and Ajmal Waheed from the southern Pakistani city of Karachi. They were members of an organization called the Pakistan Islamic Medical Association, which allegedly provided medical assistance to the Taliban and al-Qaida fugitives at an exclusive facility in Karachi.
Khalid Sheikh Mohammed, the alleged organizer of the Sept. 11, 2001, terrorist attacks in the United States, was also arrested from the residence of a Jamaat sympathizer, Ahmed Qadoos. The 42-year-old Pakistani denied direct links to the Jamaat or al-Qaida but his mother, Mahlaqa Khanum, was the president of the Jamaat women's wing in Rawalpindi, a city adjacent to Islamabad.
Musharraf also blamed the Jamaat for sheltering al-Qaida suspects. "I can say, with 100 percent surety, that we arrested the suspects from the homes of Jamaat workers," he said. "In some places, they also fired at the raiding party."
This is the first time that the Pakistani government has directly blamed the Jamaat for helping al-Qaida fugitives. Although Pakistani security agencies first learned about the Jamaat's links to al-Qaida soon after the Sept. 11 attacks, they refrained from taking on the Jamaat, a powerful religious group with hundreds of thousands of devoted workers spread across the country.
Previous governments in Pakistan have avoided a direct clash with the Jamaat, which is capable of bringing thousands of workers out into the streets and has successfully demonstrated its strength in the past.
When talking about the Jamaat, Musharraf seemingly added as an afterthought he did not believe that "the Jamaat as an organization" is involved with al-Qaida.
The Jamaat was also cautious not to attack Musharraf while responding to the government's allegations. "The interior minister should resign because he has failed to maintain law and order in the country," said a senior party spokesman, Monawar Hussain. "To hide his failure, he is now blaming the Jamaat."
The police, he said, have been holding the two physicians in their custody for weeks but so far have not been able to prove their links to al-Qaida.
Some observers, however, say that the government was bringing pressure on the Jamaat to force it withdraw a demand for Musharraf to leave the army. In an arrangement with the Jamaat and other religious parties earlier this year, Musharraf had agreed to quit the army and rule the country as a civilian president. But since then, both Musharraf and his close aides have said the general, who came to power in a bloodless coup in 1999, is not bound to do so.
"It is not so much about al-Qaida," said Hussain Huqqani, a visiting fellow at Washington's Carnegie Endowment for International Peace. "It is more about domestic politics and Musharraf's desire to continue to govern as a military ruler."
Copyright ? 2001-2004 United Press International


>> PERVEZ CAN DO BETTER...

Two Men Held in Pakistan Are Back Numbers
DEBKAfile Exclusive Report
August 2, 2004, 5:27 PM (GMT+02:00)
Improbable hideaway for al Qaeda secrets
DEBKAfile's counter-terror experts are skeptical about the sourcing of the intelligence which prompted the terror alert - declared Sunday at five financial bastions in New York, Washington and New Jersey - to Pakistan's two newest al Qaeda captives, the Tanzanian Ahmed Khalfan Ghailani, caught on July 25, and the Pakistani Muhammed Naeem Noor Khan, apprehended on July 13.
US Homeland Secretary Tom Ridge made a point of thanking Pakistan for its intelligence assistance in forewarning against terror attacks, naming the IMS and World Bank in Washington DC, the New York Stock Exchange and Citicorp and Prudential in New Jersey at targets. But ascribing the "unusually specific information" to these two detainees in Pakistani custody poses questions.
Ghailani fled to Afghanistan after the 1998 twin US embassy bombings in East Africa and reached Pakistan after US troops invaded Afghanistan in 2001. He remained in hiding among low-ranking al Qaeda adherents from then on without holding any important jobs in the organization.
Khan is equally improbable as al Qaeda's present communications manager. According to DEBKAfile's terror experts, the use of coded Internet and e-mail messaging for transmitting signals and orders was more or less abandoned from mid-2001, months before the 9/11 attacks. Since then, messengers and personal couriers have carried most of al Qaeda's coded messages, usually without knowing what was in them or even the identities of the recipients.
The two men are not of the usual a Qaeda caliber for preparing a complex, spectacular attack in the United States - or even acting as the top level's repositories for the necessary foreknowledge. Only very limited information must therefore have been elicited from the two men detained in Pakistan and their computers:
1. They may have known that Al Qaeda started surveillance operations against key US financial centers as far back as to 1999-2000, straight after the embassy attacks in Kenya and Tanzania. The surveillance was integral to the organization's preparations for the September 11 attacks in New York and Washington. The financial centers may have been intended as additional targets or alternatives if the World Trade Center and Washington strikes failed.
2. Khan, though a youthful 25, does not belong to al Qaeda's new breed. He was on the information hub staff 1998 or 1999 until the present. This means he was working with the pre-Afghan War commanders and may not have known that contemporary missions had already passed into the hands of new recruits who joined up in early 2003 when al Qaeda regrouped in Saudi Arabia and Iran after the Afghan debacle. Khan would have been allowed to carry on until the present without being informed of the new men driving al Qaeda's current operations. The organization is so compartmented that they would not have realized they were superceded. For the same reason, no single operative could conceivably be in control of updated intelligence on terrorist plots in the United State as well as Britain, as Khan is claimed to be.
3. The Al Qaeda computers fallen into US intelligence hands until now have thrown out an abundance of data on terror plots and networks, most of which proved false or planted to mislead. The most striking instance occurred in September 1998, when FBI agents reached the hurriedly-vacated home of al Qaeda's East African agent Muhammed Fazul on the Indian Ocean Comoro Islands. Fazul orchestrated the US embassy attacks in East Africa and was Ghailani's direct commander. The computer he discarded on the Indian Ocean Island was packed with data on terrorist targets and al Qaeda cells in the Horn of Africa and the southern extremity of the Arabian Peninsula. Years of strenuous following up this information ended up yielding nothing.
4. Even if some of the information obtained from the two detainees holds up, an operation on the colossal scale of 9/11 was not contemplated, only strikes using local teams. Al Qaeda would not activate its entire network for suicide truck bomb attacks on buildings. Neither are its leaders inclined to copy their Iraq modus operandi in the United States. Counting possible sleepers, the fundamentalist organization does not maintain in North America even one tenth of its present strength in Iraq - around 1,500 today down from 4,500 in the first half of 2004.


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>> LA RATA SE ESCAP? - SAID CARTER?

Ch?vez: ?S? o No?
Las horas est?n contadas para que el pueblo venezolano decida si Hugo Ch?vez debe continuar en el poder o, por el contrario, tiene que abandonarlo. Sin duda ser? una hist?rica jornada para la democracia, por lo in?dito del referendo revocatorio al mandatario venezolano. Para que Ch?vez deje la presidencia es necesario que sus opositores obtengan m?s de 3,7 millones de votos --y que superen la votaci?n de quienes lo apoyan--, que fueron los que el gobernante obtuvo en las elecciones del 2000.
La oposici?n ha denunciado la existencia de migraciones fraudulentas de electores y asegurado que esa situaci?n, junto a la entrega tard?a de los listados de votantes, resta transparencia al proceso. El gobierno chavista, por su parte, habla de la trama de una insurrecci?n si es que el referendo favorece al presidente Ch?vez.
Aunque los enfrentamientos por diferencias de origen pol?tico o ideol?gico --con todo tipo de maniobras-- no son ajenos al juego de la democracia, es muy importante que ?stos se circunscriban en el marco de la legalidad constitucional y con reglas claras de juego. De otra manera, no s?lo se le resta transparencia al proceso, sino que se expone al sistema y al pa?s entero al riesgo latente de una disoluci?n definitiva.
Gran responsabilidad tienen las autoridades competentes en mantener el orden y en impedir que se enturbie la jornada electoral con actos fraudulentos o de violencia. Tambi?n debe haber garant?as m?nimas para que los medios de comunicaci?n ejerzan su libertad de expresi?n, sin temor alguno a represalias o ataques como los que han sufrido meses atr?s.
En manos de la comunidad internacional --ONU, OEA, Centro Carter-- estar? la estrecha vigilancia de la celebraci?n del referendo para verificar que todo se cumpla cual lo acordado pero, especialmente, para que no haya dudas en ninguno de los bandos --oficialista y de oposici?n-- sobre la claridad y justicia de los resultados.
Los venezolanos se juegan nada menos que el futuro de un pa?s polarizado y sumido en el peor caos pol?tico de su historia reciente. Conscientes de esta realidad, los votantes deber?an acudir a las urnas despojados de sus tintes pol?ticos, y arropados por la solidez de la democracia que los ha caracterizado, para elegir lo que m?s le conviene al pa?s, a la sociedad.
Ojal? se respeten y se cumplan los compromisos adquiridos por todos los actores de esta contienda, para que la jornada c?vica del 15 de agosto en Venezuela sea otro triunfo de la democracia en Am?rica Latina.



Ch?vez: Yes or No?
The countdown is ticking away for the Venezuelan people, who must soon decide whether president Hugo Ch?vez should continue in power or should leave. No doubt the outcome will mark a historic watershed for democracy, because the forthcoming recall referendum will not be business as usual for the Venezuelan president.
For Ch?vez to leave the presidency, it is necessary for his opponents to get more than 3,7 million votes --and outnumber his supporters' vote -- a level he obtained in the 2000 elections.
The opposition has denounced the existence of fraudulent migrant electors, assuring that the situation, along with the late delivery of voters' listings, takes away from the transparency of the process. In turn, the Ch?vez admin-istration talks about an insurrection being plotted if the referendum should favor president Ch?vez.
While the clashes caused by political or ideological differences --fraught as they are with all kinds of maneuvering-- are not alien in the interplay of democracy, it is important that they stay within the scope of constitutional legality and clear rules of the game. Otherwise, not only will the democratic process be detracted, but the whole system and the country will become exposed to the latent risk of a definitive dissolution.
The competent authorities bear the great responsibility to keep the order and impede that the electoral exercise be clouded by fraud and violence. Also, the media must be provided with minimum guarantees so that they can exert their freedom of speech without fearing reprisals or attacks like the ones they endured several months ago.
The task of keeping a watchful eye on the referendum will fall upon the international community --the UN, OAS, Carter Center-- to ensure that everything will proceed as agreed, and particularly so that no doubt is harbored by any of the parties --government and opposition-- about the clarity and fairness of the results.
The Venezuelan people have at stake no less than the future of a polarized country that finds itself plunged into the worse political chaos in its recent history. Aware of this fact, the voters should go to the polls free from any political taint, under the protection of the solid democracy that has characterized them, to vote for what is best for their country and society.
It is to be hoped, therefore, that the commitments agreed upon by all actors in this contest are met, and that on August 15 the Venezuelan civic event achieves another triumph for Latin American democracy.

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Venezuela
Venezuela is oil. Venezuela provides the United States with about 15 percent of its oil, the third largest supplier behind Saudi Arabia and Canada. The Government of Venezuela has opened up much of the hydrocarbon sector to foreign investment, promoting multi-billion dollar investment in heavy oil production, reactivation of old fields, and investment in several petrochemical joint ventures. Almost 60 foreign companies representing 14 different countries participate in one or more aspects of Venezuela's oil sector. The Venezuelan national oil company Petroleos de Venezuela, S.A. (PDVSA) and foreign oil companies have signed 33 operating contracts.
Hugo Chavez Frias, an avid admirer of Cuba's Fidel Castro, once remarked, on one of his many visits to the Cuban capital, Havana, that the two countries were sailing towards what he called "the same sea of happiness". Ever since then, the accusation that Venezuela's leftist president wants to copy Fidel Castro's communist system has been a constant of opposition speeches and rallies. Fidel Castro is a very good friend of Hugo Chavez, who he visits frequently. To Venezuela's entrenched elite, Chavez is a palurdo, a lower-class wannabe upsetting the old order.
The US initially adopted a "wait and see" posture in the aftermath of Hugo Chavez's landslide victory in Venezuela's presidential elections. But by 2002 George Friedman, chair of the intelligence organization, Stratfor, suggested that Venezuela's Hugo Chavez was next on Bush's military agenda. "You've got a team in the White House that is unafraid of world public opinion because they know it is unreliable, self-serving and hypocritical.'' he said.
Background
Since the overthrow of Gen. Marcos Perez Jimenez in 1958 and the military's withdrawal from direct involvement in national politics, Venezuela has enjoyed an unbroken tradition of civilian democratic rule.
In 1989, the prevailing political calm was shattered when Venezuela experienced rioting in which more than 200 people were killed -- the so-called Caracazo, in response to an economic austerity program launched by then-President Carlos Andres Perez. Subsequently in February 1992, a group of army lieutenant colonels led by future President Hugo Chavez mounted an unsuccessful coup attempt, claiming that the events of 1989 showed that the political system no longer served the interests of the people.
A second, equally unsuccessful, coup attempt by other officers followed in November in 1992. Lieutenant-Colonel Hugo Chavez led the unsuccessful military coup in 1992 against the democratic government in Caracas. That effort earned him two years in prison.
Hugo Rafael Ch?vez Fr?as was born in the town of Sabaneta, State of Barinas, Venezuela, on 28 July 1954. The son of provincial schoolteachers, he is what Venezuelans call a bachaco, a man of mixed race. Accepted into the Venezuelan Military Academy in 1971, he obtained a College-level degree in Military Sciences and Arts, Engineerign Branch, Ground Specialty. Graduating as a Second Lieutenant on 05 July 1975, he began a quick ascent through the ranks of the army. In 1982, he joined other young officers in forming the "Bolivarian Revolutionary Movement," named for Simon Bolivar, the 19th century father of Venezuelan independence. The young officers were nationalists angered by the corrupt, two-party system that had dominated their country for generations.
In 1993 Congress impeached Perez on corruption charges. Deep popular dissatisfaction with the traditional political parties, income disparities, and economic difficulties were some of the major frustrations expressed by Venezuelans following Perez's impeachment.
When Chavez got out of prison in 1994, he began campaigning with his Movimiento V Republica [MVR], and Castro gave Chavez a hero's welcome when he visited Havana that year. In 1998 the Movimiento al Socialismo party announced its support for Chavez's presidential bid, and a group of leftist parties allied around his MVR won 34 percent of the seats in Congress.
Hugo Chavez won the presidency in December 1998, after campaigning for far-reaching reform, constitutional change, and a crackdown on corruption. Chavez won by a landslide margin that left the two-party system that had previously dominated national politics in ruins. Until the 1998 elections, the Democratic Action (AD) and the Christian Democratic (COPEI) parties dominated the political environment at both the state and federal level. His programs alienated much of the upper and upper-middle class while retaining the enthusiastic support of poorer Venezuelans. His platform called for the creation of a National Constituent Assembly to write a new constitution for Venezuela. Chavez's argument that the existing political system had become isolated from the people won broad acceptance, particularly among Venezuela's poorest classes, who had seen a significant real decline in their living standards over the previous decade and a half. The National Constituent Assembly (ANC), consisting of 131 elected individuals, convened in August 1999 to begin rewriting the Constitution. In free elections, voters gave all but six seats to persons associated with Chavez's movement. Venezuelans approved the ANC's draft in a referendum on 15 December 1999.
With a new Venezuelan constitution adopted in 1999, the country renamed "the Bolivarian Republic of Venezuela." There was a new presidential election that Chavez won, and allowed him to stay in power for six more years. On 30 July 2000 Hugo Chavez won reelection with 60% of the popular vote. The national election, the fifth in 18 months, pit Chavez against his 1992 military coup d'etat comrade, Francisco Arias Cardenas. Mr. Chavez' Patriotic Pole party also won a controlling majority in the country's new unicameral legislature. Chavez' six-year term runs through 2006, but Venezuela's constitution allows for a referendum at the mid-point of his term in August 2003.
Chavez opponents say the nation's economic problems began when he took office and started implementing a leftist strategy that they say is modeled after the Cuban communist system. Mr. Chavez has openly praised Cuban President Fidel Castro and has sold oil to Cuba at preferential prices. President Chavez constantly speaks of his government as "revolutionary," though he was elected democratically.
Chavez continues to deride his opponents in public. He calls them coup-plotters, and accuses them of trying to re-establish a system of government that favors the wealthy classes. He rejects what he calls the "neo-liberal" policies of past governments, and also condemns the "capitalists" and "oligarchs" who privatized some industries. There are vast gaps between rich and poor in Venezuela. Too many in the elite are enmeshed in political corruption.
In early 2000 Hugo Chavez created a stir in Bogota upon declaring that he wished to reach an agreement with the Colombian guerrillas in order to prevent their moving into Venezuelan territory.
On 10 August 2000 Venezuelan President Hugo Chavez made the first visit by a foreign head-of-state to Iraq since the Gulf war 10 years ago. The visit was part of a tour by the Venezuelan president of major oil exporting countries prior to an OPEC summit in Caracas on 27 September 2002. The Venezuelan president met with Iraqi President Saddam Hussein, during which they criticized Western pressure on the Venezuelan leader to cancel his visit. The Iraqi news media hailed the visit as a breakthrough and a weakening of the international isolation of Iraq. The visit was part of a tour by the Venezuelan
In October 2001, the US State Department recalled Ambassador Donna Hrinak for "consultations" after Chavez criticized the US war in Afghanistan as "fighting terror with terror" and met in Tripoli with Libyan leader Moammar Gaddafi. By November 2001, communications between US officials and dissident officers had become so frequent that Ambassador Hrinak took the unusual step of asking the American military attache to cease contacts with the dissidents.
In December 2001 the first national strike against Chavez, lasting just one day. This successful strike united workers with businessmen and allowed the opposition to discover its strength as a political presence. However, Ch?vez did not recognize the strike and reinforced his original style, repeatedly calling the year 2002 as "the year of his revolution's consolidation".
After a period of modest economic growth in 2000 and 2001, the Venezuelan economy entered into recession in 2002. A loss of business confidence and the devaluation of the Venezuelan Bol?var started the country's economic downturn. Political conflict, particularly the nationwide strikes last December and January, further compounded the dire situation of the country's economy. As a result, Venezuela's real gross domestic product (GDP) in 2002 fell by an estimated 8.9%.
April 2002 - The Coup
In February 2002, Chavez fired retired general Guaicaipuro Lameda from his post of President of the government-owned oil company, Petroleos de Venezuela, and replaced him with a former Communist Party militant. Protesting Chavez's actions, officials and workers at the company launched a production slowdown. On 11 April 2003, the third day of the strike, about 200,000 people marched in Caracas, calling on Chavez to resign. The march began peacefully but degenerated into violence, with a group of Chavez supporters opening fire with handguns. In all, 15 people were killed. The "massacre," as Chavez opponents called it, gave the military the moral authority to break with the president.
On 11 April 2002 the head of Venezuela's National Guard said the military had taken control of the country from President Hugo Chavez. In a televised address, Gen. Alberto Camacho Kairuz said the Chavez administration had "abandoned its functions" and the armed forces chief of staff, Gen. Bernabe Carrero Cubero, said that military leaders had asked the president to resign and call for new elections. The country's richest business leaders, its largest labor confederation, its top military men and its most influential media had joined forces against Chavez.
Chavez returned to power on 14 April 2002 following the collapse of the coup leadership in the face of an emotional outpouring from supporters in slums and towns across the country. President Ch?vez's comeback left Washington looking rather stupid. The national security adviser, Condoleezza Rice, didn't help that impression when she cautioned the restored president to "respect constitutional processes."
The Inter-American Democratic Charter is an Organization of American States' agreement to condemn and investigate the overthrow of any democratically elected OAS member government and, if necessary, suspend the offender's membership. The charter was approved by the 34 OAS member nations in Lima, Peru, on 11 September 2001. Washington's lack of commitment to democracy in the region had been made clear by the response to the Chavez coup attempt. Over the past decade, previous Administrations had reacted promptly in similar situations in Paraguay, Ecuador, Peru and Guatemala -- publicly calling for an adherence to the rule of law. This time around, the US reaction was muted, first accepting Chavez?s ouster, then embracing the coup leaders, and finally accepting the lead of the OAS to condemn the coup. In previous crises, the US rallied other countries around the hemisphere.
In the months before the coup, the US Embassy in Caracas had sought to distance itself from coup rumors. US Ambassador Donna Hrinak, took the unusual step of asking the American military attache to cease contacts with the dissidents. But Washington's signals to Chavez's opponents had been open, and at the highest levels. On 05 February 2002 testimony before the Senate Foreign Relations Committee, Secretary of State Colin Powell expressed concern "with some of the actions of Venezuelan President Chavez and his understanding of what a democratic system is all about." Similar remarks were made that same day by CIA director George Tenet. The opposition felt it had the green light from Washington to remove Chavez from power.
There were published reports that suggested that the US military provided intelligence or other assistance to the Venezuelan military as it conducted this coup. There were reports that Navy vessels carrying out exercises off Venezuela's Caribbean coast engaged in strategic communications jamming during the days of the coup. Immediately after the ouster, White House spokesman Ari Fleischer suggested that the administration was pleased that Mr. Ch?vez was gone. "The government suppressed what was a peaceful demonstration of the people," Mr. Fleischer said, which "led very quickly to a combustible situation in which Ch?vez resigned."
Within hours of the coup, Otto Reich, the assistant secretary for Western Hemisphere affairs, summoned a number of Latin-American ambassadors to his office and told them that Chavez had resigned and he urged them to support the new government. Reich reportedly phoned Venezuelan coup leader Pedro Carmona the day he took over as interim president, pleading with Carmona not to dissolve the National Assembly, which He said would be "a stupid thing to do," and would provoke an outcry. Subsequent reports suggest that this phone call was made by the US ambassador.
Otto Juan Reich, the State Department's assistant secretary for Western Hemisphere affairs, and Rogelio Pardo-Maurer, Reich's counterpart at the Defense Department, met with Venezuelan leaders of the coup during preceeding months. Pardo-Maurer was an aide to the head of the Contras when they were waging their US-backed war against the elected leftwing Sandinista government in Nicaragua. Reich was a key player in the Iran-Contra scandal. In the mid-1980s ran the State Department's Office of Public Diplomacy for Latin America and the Caribbean. Since Reich is a hard-line anti-Castro Cuban immigrant with a long history of covert activity, speculation spread that that he - along with other veteran cold warriors - helped stage-manage the Venezuelan coup.
On 16 April 2002 Victoria Clarke ASD (PA) was asked for the record whether or not the US military provided any intelligence and other support to the Venezuelan military when they were conducting the coup against President Hugo Chavez? Clarke reponded that "We wouldn't talk about any intel. matters, but I can say emphatically that we had somebody from our policy shop who met recently with the chief of staff, who made it very, very clear that the U.S. intent was to support democracy, human rights, that we in no way would support any coups or unconstitutional activity." The meeting took place between the assistant secretary of Defense for Western Hemisphere Affairs, Roger Pardo-Maurer and General Lucas Romero Rincon, chief of the Venezuelan high military command, on 18 December of 2001.
The United States suggested that Chavez's increasingly autocratic governing style was largely responsible for provoking the popular discontent that resulted in his brief ouster. Regional leaders criticized the Bush Administration when Mr. Fleischer blamed President Chavez for provoking the coup that briefly drove him from power after his supporters fired on protesters. When President Chavez returned to office two days later, Mr. Fleischer said the Bush Administration repeatedly told opposition leaders that they would not support a coup. Asked her reaction to the brief ouster, National Security Advisor Condoleezza Rice said "I hope that Hugo Chavez takes the message that his people sent him that his own policies are not working for the Venezuelan people... "
A senior State Department official emphatically denied that the United States in any way supported a coup to oust Venezuelan President Hugo Chavez. "Let me now say, categorically: the United States did not participate in, inspire, encourage, foment, wink at, nod at, close its eyes to, or in any way leave the impression that it would support a coup of any kind in Venezuela," said Ambassador Lino Gutierrez, Principal Deputy Assistant Secretary of State for the Western Hemisphere. "In all our meetings with Venezuelans in the government and opposition in recent months, in Washington and in Venezuela, we underlined this fundamental principle of our policy." Discussing the U.S. response to the upheaval last week in Venezuela at a session at the North-South Center in Washington 17 April 2002, Gutierrez said, "We oppose military coups in any democratic country."
December 2002 - General Strike
The Venezuelan opposition began a general strike against President Hugo Chavez on 02 December 2002. The aim was to intensify street protests in an attempt to force the president to bring forward elections. The opposition decided - to the surprise of many observers - to continue extending its strike day-by-day. In mid-December, the strikers shut down a large portion of the country's oil industry, drastically reducing the production of Venezuelan oil and its delivery to internal and external markets. President Ch?vez declared the strikers' demands unconstitutional and enlisted the help of the military to maintain production. By mid-December government efforts to free the country's oil industry from the clutches the national strike had provoked protests from petroleum workers and Venezuela's merchant marines. President Chavez fired 16,000 of the striking workers and has replaced them with workers loyal to his government.
On 13 December 2002 The White House said that it wanted Venezuelan President Hugo Chavez to call early elections to end the political crisis that has paralyzed the country's vital oil industry. White House spokesman Ari Fleischer said the United States was convinced that early elections are the only peaceful and politically-viable way out of Venezuela's political crisis. "The United States believes that this is the best course to preserve peace in Venezuela, a society that has been wracked on an increasingly-daily basis with violence. And the president believes that the solution to issues that could potentially involve violence is to defuse the violence and focus on democracy."
Diplomats from the United States, Brazil, Chile, Mexico, Spain, and Portugal, the so-called "friends of Venezuela," pressed for a solution, based on proposals set forth by former US President Jimmy Carter on 21 January 2003. Under the Carter plan, there would either be a recall referendum in August 2003, or a change to the constitution that would allow for early elections.
By February 2003, after nearly two-months, the opposition strike in Venezuela began showing signs of weakening, but the divide between those who oppose and those who support President Hugo Chavez remained wide. The general strike that shut down almost all commerce in Venezuela since 02 December 2002 was starting to come undone. Little by little, merchants are opening their doors, or expanding hours of operation, if they were already open. Owners of shopping centers, theaters and other popular destinations say they expect to open soon.
The strike cost Venezuela more than $4 billion, and the economy was expected to show a 25-percent contraction this year as a result. The nation's currency, the Bolivar, lost nearly 30-percent of its value. Oil production in this, the world's fifth-largest producer, fell as low as 200,000 barrels-a-day in January 2003. By the end of January, the government managed to move production back up to about 1,000,000 barrels-a-day, but that was still only about a third of what used to be produced.
Since January 2003, President Ch?vez has expanded his administration's control over the economy by banning foreign-currency trading and imposing price controls on a number of products. Ch?vez has also been pressuring the Venezuela's central bank to reduce interest rates, and has indicated that he would like to restructure external debt under more favorable terms.
2002-2003 - Continued Conflict
In late March 2003, Venezuela's military bombed and strafed an outpost in the far western part of the country. Its target: a Colombian paramilitary group pursuing Colombian rebels across the border into Venezuela. It was yet another indication of Colombia's civil strife spreading to other countries. Colombia reacted angrily at what it considered a foreign intervention in its own affairs. Venezuela responded it was protecting its territory, but in fact, is thought to be sympathetic to the leftist guerrillas who regard Venezuelan President Hugo Chavez as an ideological ally. most of the attention was on Venezuela because of the reported sympathies between Venezuelan President Hugo Chavez and some of the Colombian guerilla groups, the two largest groups the ELN and the FARC in particular.
Although the general work stoppage ended on February 3, 2003 in non-oil sectors, there has been no resolution of the strike in Venezuela's oil sector, now in its sixth month. As of May 2003, Venezuelan crude oil production is widely believed -- by striking workers and independent analysts -- to be around 2.6 million barrels per day.
Venezuela has been supplying Cuba with 53,000 barrels of oil a day at reduced prices in exchange for the services of Cuban doctors, paramedics, teachers, workers, and other technicians who participate in internationalist missions. Cuba's petroleum debt with Venezuela's State Oil Company, PDVSA, rose to $266 million by May 2003. The Castro regime has fallen behind on payments to PDVSA repeatedly since Fidel Castro and Hugo Chavez signed a trade agreement in October 2002. PDVSA supplies approximately 35% of the island's oil under generous financing terms that amount to a 25% price subsidy over 5 years.
The opposition umbrella group, known as the Democratic Coordinator, long insisted the country could not endure the controversial leadership of populist President Hugo Chavez until August 2003, when his current six-year term reached the three-year mark. They accused the president, among other things, of seeking to impose an authoritarian regime, of repeatedly violating the constitution and of destroying the economy. Despite staging a devastating, two-month long strike and business stoppage, which paralyzed the country's vital oil industry, in a bid to force the president to resign or hold an early vote, the opposition was eventually forced to give in.
After months of talks among Venezuelan government, the opposition, and diplomatic representation led by the "Group of Friends," which includes Brazil, Chile, Mexico, Portugal, Spain and the United States, the Organization of American States (OAS) and the Carter Center, relevant parties were unable to reach an agreement to stage a referendum in 2003.
2003 - Cuba Connection
The claim that Hugo Chavez wants to copy Fidel Castro, repeatedly denied by the government, received fresh impetus in July 2003. The catalyst was the launch of a nationwide literacy campaign designed in Cuba. There have also been renewed allegations that Cuban doctors and sports instructors, as well as teachers, sent in the hundreds by Fidel Castro, are part of an indoctrination scheme aimed at introducing communism by stealth.
Chavez made a deal with Cuba's Fidel Castro, though many of the deal's provisions - like bartering Venezuelan goods for Cuban doctor and other professional services - were questionable in the norms of international trade. Details of the deal were suppressed from traditional Venezuelan media, but those details did leak out via the Web.
The poor barrios of Caracas are the scene of a new pilot program aimed at improving health care for the poor. Cubans described as "volunteers" have moved into private homes, where they offer free consultations and medication, often in open competition with clinics run by the metropolitan authorities. Caracas health officials say their budget has been cut by over 50-percent, with the result that their already over-burdened clinics are facing collapse. They suggest that this may be part of a plan to shift resources to the Cuban cooperation project. Adding to the controversy are accusations that the Cubans are neither qualified to practice medicine nor familiar with modern pharmacology or treatment methods. There have been claims by Venezuelan doctors of serious malpractice that allegedly placed patients' lives in danger.
There have been similar complaints by the teachers' unions about the Cuban-designed literacy campaign. Over 70 Cuban teachers were brought in to train Venezuelans to use the audio-visual material. So far, the opposition has been unable to prove its accusations of indoctrination.
2004
On 26 February 2004 Venezuelan Chancellor, Jesus Arnaldo Perez said "The United States must resort to the corresponding institutions to prove its innocence," referring to accusations made several organizations and by Venezuelan President, Hugo Chavez, regarding US involvement and financing in destabilizing events which were encouraged by opposition sectors against the Venezuelan government, such as the attempted coup that occurred on April 11, 2002. Perez pointed out that "not only Venezuela but the whole world is waiting for an explanation concerning these actions" and he highlighted that it is indispensable for the US government to deliver a speech regarding this issue, "the US must come out of that ambiguity and clarify that it gives support to democracy and not to opposition sectors that are trying to disregard the democratic system".
Venezuelan government representatives, Eustoquio Contreras, Calixto Ortega, Nicolas Maduro and Cilia Flores requested the US Congress to set up a commission to investigate the usage of funds granted to opposition groups by the National Fund for Democracy (NFD) to promote destabilization in the Venezuelan democratic system. The Venezuelan delegation explained that "NFD funds have been used in a biased way, they have been exclusively granted to ultra-radical opposition organizations that have not been in accordance with Venezuelan constitutional channels". They also made reference to the Education Civil Association Assembly which has received 100,000 dollars for an alleged educational reform program, and they added that the founding member and Association president was appointed Minister of Education during Pedro Carmona's attempted coup in April 2002.
On 29 February 2004 President Bush ordered US Marines into Haiti as part of an international stabilization force following the departure of President Aristide. Aristide's departure rattled President Hugo Chavez. In a Caracas speech punctuated by expletives, Chavez insulted President Bush and railed against alleged US intervention in Venezuelan politics. Chavez accused the US of involvement in a 2002 failed coup against him and said it is funding groups seeking a presidential recall vote.
On 01 March 2004 President Chavez said "If Mr. Bush is possessed with the madness of trying to blockade Venezuela, or worse for them, to invade Venezuela in response to the desperate song of his lackeys ... sadly not a drop of petroleum will come tothem from Venezuela."
On 03 June 2004 Venezuelan election officials decided to allow a recall referendum on the rule of President Hugo Chavez to go forward. The council announced that opponents of Mr. Chavez had gained the petition signatures of the 20 percent of the electorate necessary to force a recall. The council had initially rejected the recall move on grounds that a sizable portion of signatures collected were invalid. But after allowing voters to reconfirm signatures late last month, it ruled that recall supporters had gotten the required total of nearly two and a half million. After the election petition verdict, Mr. Chavez reiterated a claim the United States is behind the recall move. Under the Venezuelan constitution, there would be elections for a new president if Mr. Chavez loses a recall before 19 August 2004. But if he is defeated in a recall vote is held after that, Mr. Chavez's vice president would take over and run the country for the remainder of the his term which runs until the end of 2006, effectively extending his government's rule.
On 15 August 2004 Venezuelans voted in a referendum on whether to recall President Hugo Chavez or allow him to complete his term in office. His opponents say he is emulating the failed policies of Cuba's Communist dictatorship. They also say Mr. Chavez is a threat to Venezuelan democracy. Venezuelan authorities have launched politically motivated investigations against recall supporters, including Sumate, a Venezuelan civic organization that is promoting voter education and mobilization. The August 15th recall vote will determine President Hugo Chavez's political future and will send an important message about the future of democracy in Venezuela.
On 16 August 2004 the Venezuelan Electoral Council announced that President Hugo Chavez had won the special recall election through which opponents hoped to unseat him. With 94 percent of the vote counted, more than 58 percent of voters opposed the recall.
http://www.globalsecurity.org/intell/ops/venezuela.htm
Maintained by John Pike
Last Modified: August 16, 2004 - 12:33
Copyright ? 2000-2004 GlobalSecurity.org All Rights Reserved


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Canada Supports Curbing Iranian Nuclear Work

Canada announced Friday it would support efforts by the International Atomic Energy Agency to halt Iran's alleged nuclear weapons development, the Ottawa Citizen reported (see GSN, Aug. 11).
"We are very preoccupied by the nuclear proliferation," said Foreign Minister Pierre Pettigrew, after meeting with U.S. Secretary of State Colin Powell. "And we are not pleased at all with the way the Iranians are conducting this level of nuclear proliferation," Pettigrew added (Mike Blanchfield, Ottawa Citizen/Canada.com Aug. 14).
Iranian Supreme Leader Ayatollah Ali Khamenei said the Islamic republic would proceed with its nuclear program despite international concern, Iran's state news agency reported today.
"The Islamic republic will continue on the reasonable path which will result in the peaceful use of nuclear energy without concerning itself about all this fuss and bother," Khamenei said yesterday, according to Agence France-Presse (Agence France-Presse/Khaleej Times, Aug. 16).
Elsewhere, U.S. Senate Foreign Relations Committee Chairman Richard Lugar (R-Ind.) said yesterday that the United States should get "very tough" with Iran to prevent the Islamic republic from building a nuclear bomb.
"The Iranians are moving toward weaponization of the uranium experiment that they have. And they've been clearly doing this. I suspect to begin with economic sanctions on Iran ... but not ruling out at the end of the day military sanctions against Iran," Lugar added.
Lugar could not say whether the United States would back a pre-emptive strike on Iran's nuclear installations by another nation, such as Israel's attack against Iraq in 1981.
"I'm not going to speculate for a moment on a pre-emptive strike or any specific action," he said (UPI/Washington Times, Aug. 15).
Meanwhile, the United States on Friday called on Japan to review its business dealings with Iran in light of the Islamic republic's suspected nuclear weapons drive, Agence France-Presse reported.
"We would hope that as Japan examines its relationship with Iran, it would take into account, in any business transaction or any proposals that come along, the fact that Iran is not behaving in a responsible manner," Powell said (Agence France-Presse, Aug. 13).
In response, Japanese officials said yesterday that Japan does not plan to stop pursuing an oil development deal with Iran, Kyodo News Service reported.
"We won't say we'll give up just because we were asked to do so," said Economy, Trade and Industry Minister Shoichi Nakagawa. "There will be no policy reversal at the current stage," Nakagawa added (Kyodo News Service/Japan Today, Aug. 15).

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Iran's Looming Missile-cum-Nuclear Threat Sparks Fresh Tensions
DEBKAfile Special Military Report
August 8, 2004, 2:00 PM (GMT+02:00)
Saturday night, August 7, Iranian defense minister Admiral Ali Shamkhani came out with a disturbing announcement. He said Iran will soon test an improved version of its new ballistic Shehab-3 missile whose 1300-km range covers every part of Israel.
"These improvements do not only concern its range, but other specifications as well," said the Iranian minister, adding "The Israelis are trying hard to improve the capacity of their missiles, and we are also trying to improve the Shehab-3 in a short time." He offered no details on either upgrade, saying only: "We will improve the missile and when we test it, in the very short future, we will let you know." If attacked, Iran would not leave its people without defense, he stressed.
Shamkhani also denied any Iranian cooperation with North Korea in missile technology - as suggested in Washington - stressing that the Islamic Republic does not need it.
In between emphasizing defense, Shamkhani issued a dire warning to Israel not to dare attack its nuclear sites.
DEBKAfile notes that the Shehab-3 missile's first unveiling was accompanied by the pledge: "We will wipe Israel off the map," a theme that recurs every Friday sermon in Iran's mosques and its official pronouncements. In view of the Tehran hardline regime's admitted strategic commitment to Israel's destruction, Iran's nuclear program combined with the development of its Shehab-3 is seen by policymakers in Jerusalem as the greatest threat to Israel's existence since 1948.
Iran's processing facilities for enriching the uranium necessary to building nuclear weapons are carefully dispersed in several subterranean sites. They are built in bunkers, often tens of meters deep, under densely populated urban centers, in the hope of deterring the Americans and the Israelis from attacking them.
Nonetheless, the Iranians do not feel safe. The defense minister believes Israel is developing a new type of depth bomb able to penetrate buried sites or wipe out electronics with electro-magnetic energy bursts. Tehran's defense specialists are also keeping a watchful eye on the war tactics employed by the US military before, during and since the invasion of Iraq and against the Iraqi guerrilla war. They regard the Iraq precedent as a potential dress rehearsal for a possible US military operation against Iran.
Iranian military chiefs avidly read American publications on new weaponry - for instance, US Air Force research on a 9.5 tonne Massive Ordnance Air-burst Bomb capable of hitting mountain bunkers, whose warhead is as powerful as a small nuclear bomb. This weapon is designed to replace the biggest conventional US bomb, the 7.5 tonne Daisy Cutter, used at least twice in Afghanistan against mountain caves.
The Iranians are also worried by the airborne GBI-28 bunker busters the Americans used in the capture of Baghdad and in another airborne or cruise missile-carried BLU-114B bomb that is capable of knocking out the electricity grids of whole cities. There are reports of an "E-bomb" under development, whose microwave beams can massively damage electronic circuitry over a large area.
International media, furthermore, have reported at least one Israeli Dolphin submarine carrying cruise missiles with nuclear warheads to be lurking in waters just outside the Persian Gulf between the Indian Ocean and the Gulf of Aden. Israel's Ofek 5 spy satellite is also able to track Iran's nuclear activities.
Iran is concerned by these new weapons and devices because they are armed with deep underground penetration capabilities, or geared to crippling electric and electronic systems in urban areas. Iran's subterranean nuclear plants are therefore potentially vulnerable - even in their subterranean lairs under cities. Iran's regime and military leaders live in fear of waking up one morning to find that an Israeli or an American strike has wiped out their nuclear option just when it is closest to their grasp.
Although Tehran's highly effective procrastination maneuvers have paid off so far in keeping diplomatic, military and economic hurdles at bay, defense minister Shamkhani finds it necessary to issue a warning threat to Israel. In the last ten days, these threats have intensified as a result of certain key developments inside Iran.
One, According to DEBKAfile's Iranian sources, Iran's radical spiritual ruler Ali Khamenei convened a high-powered secret conference Sunday, August 1, to underline a policy of nuclear brinkmanship in the face of the US-led international outcry against its nuclear weapons program. The decision to tough it out was endorsed by the assembled leadership group of former president Hashemi Rafsanjani, secretary of the national security council and liaison on nuclear matters with international institutions Hassan Rouhani, Iran's former delegation to the IAEA Ali Akbar Salehi, head of foreign affairs commission of NSC Seyyed Hossein Moussavian and also defense minister Shakhmani.
A tough line against America automatically begets a doubly aggressive attitude towards Israel.
Two, Some of the new Shehab-3 missiles have been deployed secretly in central Iran - both as a shield for the nuclear plants against air, ground or naval attack and as a retaliatory option against attackers.
Knocking out this deployment would leave the industry susceptible to attack and nullify Iran's deterrent.
The comment by Israel's air defense commander that Israel's Arrow II anti-missile missile system successfully tested last week against a Scud would not be effective against an Iranian multiple warhead Shehab 3 was taken with a pinch of salt by the ayatollahs who live in suspicion of trickery. But it does leave teasing questions about what Israel can do to prevent the deployment of the soon-to-be tested improved Shehab-3 batteries pointing in the direction of the Jewish state.
Sunday, August 8, the New York Times reported: American intelligence officials and outside nuclear experts have concluded that the Bush administration's diplomatic efforts with European and Asian allies have barely slowed weapons programs in Iran and North Korea over the past year and both have made significant progress. Senior administration and intelligence officials, the paper reports, say they are seeking ways to step up unspecified covert actions.
The NYT report is sourced to Kennebunkport, the Bush family's summer residence.
The Shakhmanei threat and this report come together with the distribution in southern Israel Sunday, August 8, of Lugol radiation antidote capsules to people living in the triangle formed by Israel's nuclear center at Dimona, Arad and Eilat on the Red Sea. Home Command soldiers are handing these iodine dose packages - not to be opened until ordered - round homes in Dimona, Yeruham, Arara, Kseifa and Bedouin Negev settlements. Instructions in Hebrew, Arabic, English, Russian and Amharic are attached. Distribution centers will also stock the antidote and extra doses made available for growing families.
Lugol is being handed out in case of an accidental leak from the Dimona reactor, say Israeli officials. They are talking less about the danger of nuclear fallout from a possible strike by an Iranian Shehab-3 missile.
In the 1991 Gulf War, Saddam Hussein did shoot a Scud missile against Dimona. It carried a warhead packed with cement for smashing through the reactor's dome but missed its target and fell in the sand without causing damage.

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The Terror Masters Revisited
Let's go to the videotape.
Saturday's Washington Post had an article that quotes the usual unnamed intelligence sources saying that they are surprised to discover that al Qaeda has "reconstitute[d]" itself. This surprise derives from, inter alia, the computer data found recently in Pakistan, intelligence sources (both ours and friends'), and simply looking at the range of activities in which the terrorists engage.
This surprise is, as usual, unsettling, since it has been quite clear for some time now that al Qaeda and the other major terrorist groups -- Hezbollah, Islamic Jihad, Hamas, Jamaa, etc. -- are all working together, and have been ever since we went into Afghanistan. The cooperation increased in the run-up to Operation Iraqi Freedom, and was only possible because the regimes who gave the bulk of the operational support to the terrorists -- Syria, Iran, Iraq, and Saudi Arabia -- worked closely to coordinate the anti-American jihad. That coordination has, for the most part, continued (note the visit of Bashar Assad to Tehran at the time of the turnover of "sovereignty" in Iraq. At those meetings, Syria and Iran agreed on a five-point plan to attack us in Iraq, Europe, and at home, and to do everything possible -- including massive efforts to get the price of oil as high as they can -- to defeat President Bush in November's elections).
This helps understand the coordination between, say, attacks by the forces of Moqtada al Sadr and Baathist "loyalists." The infrastructure was created before we ever arrived in Iraq.
I wrote about this phenomenon at the time, and it enabled me to accurately forecast what happened in Iraq: the active cooperation among terrorists of widely diverse ideological, religious, and national backgrounds and convictions, in a desperate effort to drive us out of Iraq.
The war in the Middle East -- for it is a regional war, not merely a battle for Iraq -- cannot be analyzed at the level of the individual terrorist groups, because the terrorists are part of a larger context. The organizing center is, as Spanish Magistrate Balthazar Garzon publicly put it, a "directorate" located in Iran, that works closely with Iranian intelligence organizations, including the Revolutinary Guards. Those organizations, in turn, work with their counterparts in other friendly countries.
BLIND ANALYSTS
In order to conceal their activities from us, the Iranians have deployed several deceptive myths. The two most effective are "al Qaeda" and "Zarqawi." I believe I was the first American writer to call attention to Zarqawi (long before he was named by secretary of State Colin Powell in his presentation to the U.N. Security Council). I was able to do that because I had read German and Italian court documents that proved Zarqawi, operating from Tehran, had organized a European terrorist network. I'm sure that fact was known to Garzon, as it was to the Italian military intelligence organization, SISMI, which came to similar conclusions (published a few months ago in the Corriere della Sera).
This was the period when, according to our intelligence analysts, Zarqawi became a major player in al Qaeda.
It follows that the Iranians were involved in the marriage between al Qaeda and Zarqawi. To believe otherwise, you'd have to believe that Zarqawi and top al Qaeda officials were operating freely and independently of the Iranian regime. I don't think any serious person would buy that one.
But the notion that radical Sunni terrorists like Zarqawi and bin Laden and Zawahiri were working hand in glove with the radical Shiite regime in Tehran was an impossible hypothesis for most of our analysts, who believed that strategic cooperation between Sunnis and Shiites was not possible (even though, for example, the Sunnis of Arafat's Fatah-trained Khomeni's Shiites -- the embryonic Revolutionary Guards -- in the Bekaa Valley as early as 1972. I have personally interviewed the person who organized that training program). Those analysts were working with false assumptions within the wrong context.
By now, an Iranian role is obvious, as is the Syrian component. More evidence pours in every hour. Just look at the best Iraqi bloggers, or, if that's too hard, just listen to the Iraqi defense minister or the Iraqi interior minister. But I don't think we have accepted the full context, and we won't get it right so long as we continue to obsess over al Qaeda and/or Zarqawi.
Zarqawi is an instrument of a far more powerful terrorist engine: the Iranian regime, allied with other terror masters. Zarqawi himself is only involved in a fraction of the actions for which he gets credit; the most important figure is actually our old enemy, Imad Mughniya, the operational commander of Hezbollah. And if you're in a betting mood, I'll give you even money that Hezbollah is the operational glue that binds together the various terrorist factions on the ground in Iraq.
TYRANNICAL TERROR TRIO
I think it's fair to say that my analysis has stood up pretty well, starting more than a year before Operation Iraqi Freedom. If I am right, then we cannot possibly "win" in Iraq, because Iraq is just one battlefield in a (at a mininum) regional war. The Iranians, Syrians, and (a significant group of) Saudis dare not acquiesce in the creation of a free and successful Iraq, because that would mortally threaten their own survival. The regimes in Tehran, Damascus, and Riyadh are extremely unpopular; their peoples are aching for the chance to remove the regimes and experiment with freedom. The regimes know that, and are ruthlessly oppressing their peoples.
Remember that Machiavelli said that tyranny is most unstable form of government. And precisely because the regimes are unstable, our most potent weapon against them is political, not military. I do not believe we can win the war by force of arms alone. It is certainly very important to defeat al Sadr in Najaf and Kut, and to liberate Fallujah, but even those victories will not suffice. Our regional enemies will find new instruments -- indeed, I have no doubt they have them already in place. Victory, as the president has said, requires regime change and the spread of freedom. And this is not nearly so daunting as might appear.
We defeated the Soviet Empire at a time when only a small minority of the people was willing to fight for freedom. We overthrew Milosevic with a minority of the Yugoslavs. In Iran we have upwards of 70 percent of the people on our side. If we supported them, I think it quite likely that we could liberate Iran in a matter of a few months. And if Iran falls, Syria will most likely come right alongside.
If we do not quickly expose the vulnerability of mullahs and empower the Iranian people, I believe the next few months in Iraq will, if Tehran has its way, be bloodier than anything we have seen to date. Not to mention the planned attacks against us here at home.
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/ledeen200408160834.asp

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A Bad Relationship
How al Qaeda has changed not just terrorism, but the way rogue states relate to their terrorist friends.
by Andrew Apostolou
08/12/2004 6:00:00 PM
ONE OF THE KEY FINDINGS of the 9/11 Commission is that al Qaeda was a terrorism innovator. Al Qaeda's "new terrorism," as the commission calls it, is more than just using aircraft as weapons and turning hijackers into pilots, it's about transforming the relationship between terrorists and rogue states. Old-style terrorists, such as the Palestinian groups, have generally been surrogates of states. By contrast, al Qaeda redefined these connections following its expulsion from Sudan in 1996, all but taking over the state in Afghanistan while loosely cooperating with other states--yet refusing to be controlled by them.
For decades rogue states used terrorism as a form of low-level, low cost warfare. Gaddaffi's Libya and the Baathist dictatorships in Syria and Iraq knew that they could not win conventional battles against either the Americans or the Israelis. Instead, they sent terrorists to murder their opponents and extract concessions from them. For these regimes, terrorism was a standard tool of statecraft, a bloodier version of the old diplomatic note.
Saddam Hussein's Iraq was the classic terrorism sponsor. The ideologically promiscuous Iraqis assisted groups inimical to their Baathist regime. Saddam helped the Muslim Brotherhood fight against his fellow Baathists in Syria, even while repressing the Muslim Brotherhood in Iraq.
The terms of the deal were that the terrorists remained under some sort of state control. Saddam supported Abu Nidal in the 1970s, touting him as an alternative to Yasser Arafat. The Iraqi regime then expelled Abu Nidal in 1983 as a condition for restoring diplomatic ties with the United States. Abu Nidal was brought back to Baghdad after 1991, but was then murdered by the Iraqis in 2002. Clearly, all relationships have their ups and downs.
There was a similar pattern to relations between al Qaeda and Sudan, where the organization was based from 1991 to 1996. The Islamic fundamentalist government of Sudan created a permissive environment for terrorists. When U.N.-imposed sanctions and the diplomatic and economic pressure grew too great, however, Sudan was willing to trade its terrorist friends. The Sudanese offered bin Laden to the Saudis on condition that he be pardoned. The Saudis declined.
Osama bin Laden's expulsion from Sudan to Afghanistan in 1996 was initially a setback. The country was in chaos and his position was precarious. Yet bin Laden soon latched onto the increasingly dominant Taliban, a militia of religious students backed by Pakistan, Saudi Arabia, and the United Arab Emirates. He won their confidence. From being their guest, bin Laden became the Taliban's partner and financier. Ties grew so close that Mullah Omar, the leader of the Taliban, ordered the murder of some of his lieutenants who had disagreed with the hosting of bin Laden. Al Qaeda seemed to fuse with the Taliban. After September 11, Mullah Omar chose to risk war with the United States rather than surrender bin Laden.
Yet throughout his time in Afghanistan, bin Laden kept his options open. He ensured that he had other bolt holes available in the unlikely event that the Taliban turned on him. Al Qaeda collaborated with rogue states, but avoided becoming dependent upon them.
For al Qaeda's state friends, the connection brought benefits but no control, rewards seemingly without risk. In return, al Qaeda received travel facilitation--vital assistance for a terrorist group operating beyond its Middle Eastern recruiting base--and training in advanced terrorist techniques.
Al Qaeda was as open-minded about its liaisons as Saddam had been. Iraq and al Qaeda undoubtedly spoke to each other. Saddam was a terror master who liked to keep his contacts fresh. Bin Laden, despite having previously assisted some of Saddam's opponents and claiming to defend Muslims, was quite content to keep channels open to a mass murder of Muslims.
More remarkable, and possibly more fruitful, were al Qaeda's dealings with Iran. Iran apparently provided al Qaeda with suicide terrorism training, a technique pioneered by Hezbollah, Iran's terrorist ally in Lebanon. The Iranian authorities also allowed al Qaeda members to pass unhindered through their territory. Graduates from bin Laden's Afghanistan camps traveled through Iran to join an al Qaeda affiliate group, Ansar al-Islam, based in a remote corner of Iraq close to the Iranian border. According to the 9/11 Commission, 8 of the 19 September 11 hijackers traveled through Iran between October 2000 and February 2001.
Pakistan was similarly accommodating towards al Qaeda's travel needs, allowing scores of operatives to cross into Afghanistan. In return, Pakistan used al Qaeda camps to train terrorists for operations in Indian-controlled Kashmir. The arrangement allowed Pakistan to deny that it was training terrorists on its own territory, and pretend it had no connection to al Qaeda, even while it supported the Taliban.
Conveniently, these relationships--of cooperation but not control--were so fleeting that they left little evidence behind them. Unlike the 1989 bombing of a Pan Am airliner over Lockerbie, Scotland, there are no direct traces of any state helping to plan or execute the September 11 attacks. Deniability was part of the link, with Iran, Iraq and Pakistan able to disown rogue border officials.
For years the hands off links between al-Qaeda and its state friends suited both sides. From now on, such relationships have to come with a price attached.
Andrew Apostolou has been a historian at St. Antony's College, Oxford, and was Director of Customised Research at The Economist Group's Economist Intelligence Unit. He is presently director of research at the Foundation for the Defense of Democracies, a policy institute focusing on terrorism. He has interviewed prisoners from an al-Qaeda affiliate group.

? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.
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Report identifies Jordan bank as funding channel for Palestinian terror groups...

Mystery of the Missing Qassam Missiles - or Arafat's New Ploy
DEBKAfile's Special Report
August 10, 2004, 1:16 PM (GMT+02:00)
Since Thursday, August 5 and up until early August 10, not a single Qassam missile landed from the Gaza Strip on the southern Israel towns of Sderot or neighboring West Negev kibbutzim. Their daily nightmare since last year was more or less in abeyance for six days. Suddenly too the stream of anti-Israel invective and threats dried up in the mouths of the ruling Fatah and its al Aqsa Martyrs (Suicides) Brigades, the Hamas, and the other Palestinian purveyors of mass terror. Furthermore, while Israelis argued the rights and wrongs of allowing Palestinian police officers (many of whom moonlight as terrorists) to patrol West Bank streets bearing arms, those officers began were already out fully armed on the streets of Jenin and Qalqilya without waiting for Israeli permission.
DEBKAfile's Palestinian sources hold up two keys to these mysteries, both held by Yasser Arafat:
A.The most important one is that Arafat has finally vanquished the former Gaza strongman and challenger Mohammed Dahlan and put down his attempted revolt. Far from marking their reconciliation, as widely reported, their expected face-to-face encounter will occasion Arafat's public declaration of victory for the benefit of the Palestinian people and Arab world and Dahlan's concession of defeat. The meeting will take place after the terms of surrender are finalized.
B. Arafat has undertaken certain steps to collect the spoils of victory. Since the United States, Britain, Egypt and Israel backed the loser, he wants them to pay the forfeit by accepting a deal on his terms.

He is offering a lull in anti-Israel violence - suddenly, he is capable - in return for which the Americans and Israelis must agree to end his three years of isolation, ostracism and siege and finally begin addressing him. A realistic political trader, he understands that President George W. Bush and Israeli prime minister Ariel Sharon face too many obstacles for an abrupt switch of course. He is therefore willing to make do with their representatives or messengers engaging him directly.
To prepare the way for re-engagement, he has instituted two important processes and raised demands.
1. The first is on the Palestinian plane and aims at proving that he, and no one else, is in command of Palestinian affairs. For four years, he generated the anarchy, of which the ordinary Palestinian is heartily sick, as a perfect breeding ground for his suicidal terror campaign against Israel. Now, the time has come for order. He has therefore instructed Palestinian policemen to be deployed in the northern Gaza Strip and to take charge of security in the Beit Lahiya, Beit Hanoun and Jebalya sectors from which the Qassam missiles plaguing southern Israel are fired. Mussa Arafat's men moved in on August 5, whereupon Israeli forces, who had spent more than a month there trying in vain to halt the Qassem barrages, moved out. By this maneuver Arafat made it clear that his hand was behind the Qassam offensive and that he has the power to restart it whenever he likes.
He also put armed Palestinian policemen on the streets of the West Bank terrorist strongholds of Qalqilya and Jenin, making the argument in Israel over what types of weaponry to approve irrelevant.
Arafat's mouthpieces then went into action with the demand that Israel abolish the standing order for its soldiers to shoot to kill every armed Palestinian seen in public. Lifting that order would enable Palestinian policemen armed with rifles to fan out through West Bank towns. Official Israeli assurances that Palestinian policemen will only be permitted handguns and must be vetted in advance by the Shin Beit are no more than meaningless pacifiers for Israeli fears.
A second demand is for an Israeli pledge that the IDF will cease its incursions into Palestinian towns.
The substantial reduction in West Bank-based Palestinian terrorist attacks against Israel owes much to Israeli preventive operations and the roughly one-quarter of the defense barrier Israel's High Court has allowed to go up. But it stems equally from a deal negotiated by Arafat's henchmen with local Fatah-al Aqsa Martyrs Brigades chiefs. For every Palestinian policeman posted on the beat, a Brigades gunman will be withdrawn and rewarded with sizeable "gifts" of thousands of shekels.
DEBKAfile's Palestinian sources note that Nablus is the real testing stone of Arafat's suddenly-discovered authority. While much was made of the revolt in the Gaza Strip, Nablus has long been caught up in local rivalries between the city governor and mayor, on the one hand, and the feuding Fatah-al Aqsa gangs of the Casbah and the Balata refugee camp, on the other.
DEBKAfile reveals: Those gangs are working on an improvised super-mortar shell designed to fly over Israel's defense barrier and strike Israeli targets on the other side. The new weapon, estimated by our military sources as 60-70mm with a range of 2-3 km, was secretly test-fired Saturday night by Abd Saleh Sanakra, Fatah-al Aqsa Brigades chief in the Balata camp.
The Nablus gangs' fervent determination to keep the terror war against Israel alive impedes all efforts to institute law and order in this largest of West Bank towns. But it does not prevent Arafat's spokesmen, prime minister Ahmed Qureia, propagandist Saeb Erekat and some Palestinian security organization chiefs, with whom the Americans are directly in touch, from maintaining that the obstacle to a real lull in Palestinian terrorist violence is Israel's slowness in meeting Palestinian demands.
2. The second process is going forward between the radical Hamas and Egypt. The Damascus-based Hamas executive Khaled Mashal was in Cairo last week for long discussions with Egyptian intelligence minister General Omar Suleiman on guidelines for the Islamic terror group's operation after Israel's evacuation of the Gaza Strip. All that has been agreed thus far is that the Hamas will not impede Egyptian efforts to keep the territory calm. Hamas leaders believe they deserve credit for doing more than their bit by accepting constraints without demanding a deal: They have let Mussa Arafat's security police take control of the northern sector, called off terrorist operations against Israelis, complied with a personal verbal request from Arafat to halt the Qassam barrage against southern Israel, and cooperated with Egypt's reconciliation efforts.
Egypt, for its part, is keen on keeping Israel calm and confident enough to allow the way to be smoothed towards bringing Yasser Arafat back into the diplomatic process. To this end, Cairo has posted general intelligence units at the Sinai end of the Palestinian gunrunning tunnels.
A lot of this is just going through motions. But even token actions and half-measures for show are having good effects. Palestinian shooting attacks and bombings have dwindled, a hopeful symptom that will persist only as long as Arafat believes he has a chance of regaining recognition. But if not, he has fully retained the option of activating his armed police, suicide squads and new weaponry at any time it suits him.




Palestinians Step up and Upgrade Missile Threat
DEBKAfile Special Report
July 31, 2004, 3:05 PM (GMT+02:00)
Russian Mi24b with two S-5 57mm pods
A Qassam missile fired from the Gaza Strip landed in the southern Israeli Negev early Saturday, July 31, after two days of heavy barrages against Sderot and local kibbutzim. No casualties were reported. In all July, Gaza Strip terrorists fired 61 Qassam missiles across the border, killing two Israeli civilians and injuring a score. The mounting threat has raised the demand to expand the IDF presence to outside the Beit Hanoun sector so as to cover additional launching sites in the northern Gaza Strip before there are more casualties.
DEBKAfile's military sources add:
When defense minister Shaul Mofaz gave Israeli troops a free hand to halt the hail of missiles, he ran into the limitations posed by Israel's approaching disengagement from the Gaza Strip. The cabinet will be asked Sunday when it convenes in Jerusalem to determine how far the IDF may drive into the Gaza Strip to stamp out the threat - without placing Sharon's planned evacuation in question, a quandary that may prove insoluble.
In any case, Arafat has raised the stakes.
Russian-made S-5 unguided aircraft rockets were part of the Egyptian haul earlier this month of a large shipment of missiles, stopped before they were smuggled to the Palestinians through the Rafah tunnels. The S-5 would be an important boost to the Palestinian arsenal; some may still defeat attempts to stop them and reach the Gaza Strip - either through the smuggling tunnels or by other routes, especially after Israeli troops are pulled back.
DEBKAfile reveals the Palestinians are planning to convert these Soviet-era 20-25-km range rockets into surface missiles capable of hitting southern Israel's key cities of Beersheba, Ashkelon and Ashdod. The rockets were originally Soviet-designed for use by the Mi-24 helicopter, the Russian equivalent of the American AH-64 Apache, in Afghanistan.
In Palestinian hands, they would upgrade the missile threat beyond that posed by the hit-or-miss home-made Qassams, even the improved Nasser version.
Since Israel withdrew from southern Lebanon, the Hizballah have lined up some 13,000 missiles along the Israeli border. But the Shiite terrorist group is subject to certain outside constraints before it can shoot missiles into northern Israel. Arafat faces no such restrictions. Smuggled into the West Bank and deployed along the new defense barrier route ordered by Israel's High Court, the new surface missiles could easily target Ben Gurion international airport and even the northern outskirts of Tel Aviv.
As to where Arafat found his new weapons, DEBKAfile's intelligence sources postulate a number of possible suppliers: old stocks in Yemen, Sudan or Syria, sold with the knowledge of their governments or officers making a private buck. Another more menacing albeit roundabout alternative is their withdrawal from the large stores maintained by Saddam Hussein's air force and army by Baathist insurgents, in token of their old ties with the Palestinians, or by al Qaeda elements fighting in Iraq, who would have used their Hizballah connections to smuggle them through southern Iraq and the Gulf emirates and on by sea to the Mediterranean coast of Egyptian Sinai.
The second possibility would explain why Egypt decided for the first time to seize a shipment of weapons bound for Rafah through Palestinian smuggling tunnels in Sinai and why Cairo hastened to report the seizure to Washington and Israel. Out of concern for its own stability, Egypt is making every effort to contain the Iraqi guerrilla-al Qaeda terror war from reaching a finger into the Sinai peninsula.


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UN: Palestinians reforms have been meaningless
Special to World Tribune.com
MIDDLE EAST NEWSLINE
Monday, August 16, 2004
The United Nations has determined that the Palestinian Authority failed to implement meaningful reforms.
In a briefing to the UN Security Council, a senior official said the PA has not responded to appeals from the international community to institute security or civilian reforms. The official said the PA has announced reforms, but largely failed to implement them.
"Implementation of reform continues to be slow, and mostly cosmetic," Kieran Prendergast, UN undersecretary-general for political affairs, told the Security Council. "This cannot be explained other than by a lack of political will to advance along that road."
Prendergast reviewed recent developments in the PA in his Aug. 11 briefing. The UN officials, a U.S. national, said PA Chairman Yasser Arafat agreed in late July to grant Prime Minister Ahmed Qurei authority over security agencies that had been under under Interior Ministry control.
But, Prendergast said, Arafat did not fulfill his pledge even in wake of a threat by Qurei to resign. Instead, such authority has remained with the Arafat-dominated National Security Council.
"Ultimate authority and control over all Palestinian Authority security agencies remains with the National Security Council, headed by President Arafat," Prendergast said.
Prendergast said the PA has failed to restructure the 13 PA security agencies. He cited another Arafat pledge to merge the security agencies.
In July, UN envoy Terje Roed-Larsen warned that the PA has been paralyzed and on the verge of collapse. Roed-Larsen blamed Arafat for the failure to implement security reforms and restore order.
The UN also was briefed on incidents in which staffers were caught in the crossfire between Israeli troops and Palestinian insurgents in the Gaza Strip. Prendergast said that in two cases Israeli troops refused to halt fire against Palestinian insurgents to enable the UN staffers to move to safety.
"The United Nations is deeply concerned over the unacceptably high number of security incidents involving UN staff caused by Israeli action over the last few weeks," a UN statement said.
Copyright ? 2004 East West Services, Inc.

Iran uranium source revealed
http://www.janes.com/security/international_security/news/jdw/jdw040810_1_n.shtml
Andrew Koch JDW Bureau Chief
Vienna and Washington, DC
Inspectors from the International Atomic Energy Agency (IAEA) believe they have resolved a key question underlying Iran's nuclear programme: whether particles of enriched uranium detected in the country are due to previous contamination on imported equipment - as Tehran claims - or represent a smoking gun proving a clandestine nuclear weapons programme.
IAEA inspectors have reached a tentative conclusion that the contamination came from equipment provided by the nuclear smuggling network headed by Pakistani scientist AQ Khan, sources close to the agency told JDW.
The existence of the particles of enriched uranium found by the agency in Iran has been a crucial factor in the continuing international dispute over whether Tehran has reneged on its obligations to inform the IAEA of all enrichment activities. Tehran claims that it has not introduced uranium into any enrichment facility - a step that would require IAEA notification - but it could not explain the presence of the enriched uranium particles.
Now, the sources say, the inspectors believe they can confirm that a sample of uranium enriched to 54%, found at one Iranian site, has come from Pakistani equipment. The confirmation was only possible after Islamabad gave the IAEA data to verify the uranium source and the US provided a simulation of the Pakistani nuclear programme that matched the account. A separate sample of 36% enriched uranium contamination derived from Russian equipment that Moscow had supplied to China. Beijing then passed it on to Pakistan as part of previous nuclear assistance and Khan later sold it to Iran.
The sources note that the origins of several other contamination samples are difficult to trace and may never be known.
The issue of enriched uranium contamination on Iranian centrifuges has been a key question the IAEA is working to resolve as part of its investigations into Tehran's nuclear programme.


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Iran's nuclear work revealed
http://www.janes.com/security/international_security/news/jdw/jdw030624_1_n.shtml
By Andrew Koch, JDW Bureau Chief, & Alon Ben-David, JDW Correspondent, Washington, DC & Tel Aviv
Iran has failed to inform the International Atomic Energy Agency (IAEA) about a number of nuclear activities in a timely manner, according to the latest report by IAEA Director-General Muhammad El Baradei, which warns Tehran that its behaviour is "a matter of concern".
The report, however, falls short of labelling the country in violation of the 1970 Nuclear Non-Proliferation Treaty, as some US officials have called for.
The report confirms, as JDW reported previously (JDW 11 June), that R&D work for Iran's uranium enrichment gas centrifuge programme has taken place at a previously undisclosed facility in Tehran called Kalaye Electric.
Regional intelligence sources told JDW that in recent weeks 1.9kg of uranium hexafluoride (UF6) gas, previously imported from China, has been used to test four centrifuges at Kalaye Electric in preparation for starting up a larger centrifuge pilot plant at Natanz.
The UF6 is part of a larger consignment Iran confirmed it had imported from China in 1991 and had not previously informed the IAEA about. That material, which includes 1,000kg of UF6, is "now being stored at the previously undeclared Jabr Ibn Hayan Multipurpose Laboratories [JHL]", located at the Tehran Nuclear Research Centre, the report says.
US officials said they have long known about JHL, which has worked on both uranium enrichment and enrichment using laser isotope separation.
Also imported from China were 400kg of uranium tetrafluoride (UF4) and 400kg of uranium oxide (UO2), which are being stored at JHL. Iran now says that in 2000 it converted most of the UF4 into uranium metal at JHL, the report notes.
Western intelligence officials said the presence of metallic uranium is proof of Iran's military nuclear intention as metallic uranium is not normally used in commercial atomic programmes. The IAEA also expressed its concern, indicating that "the role of uranium metal in Iran's declared nuclear fuel cycle still needs to be fully understood since neither its light-water reactor nor its planned heavy-water reactors require uranium fuel".


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Nuclear Facilities
http://www.nti.org/e_research/profiles/Iran/3119_3166.html
Jabr Ibn Hayan Multipurpose Laboratories (JHL)
Other Names: Jaber Ibn Hayan, Research Department (JIHRD)
Location: Tehran Nuclear Research Centre (TNRC)
Subordinate to: TNRC
Size: Numerous laboratories and facilities
Primary Function: Research and laboratory support
Description:
JHL is a multipurpose research complex that conducts research on most aspects of the nuclear fuel cycle, production of 99Mo (Molybdenum), 131I (Iodine), and 133Xe (Xenon) radioisotopes, and provides various laboratory services to the Nuclear Fuel Production Division. In a letter to the IAEA dated 23 July 2003, Iranian authorities acknowledged that 113 experiments had been conducted using the UF4 imported from China in 1991. These experiments were intended to optimize conditions for producing uranium metal. In the same letter, Iran claimed that in the early 1990s, it was unclear whether the Iranian nuclear program would consist of CANDU reactors, Magnox reactors, or light water reactors. It was therefore decided to include a uranium metal production line, since it could also be used in the production of a shielding metal. The IAEA believes the uranium metal experiments "could be considered as a process to gain know-how in nuclear material production." A uranium metal purification and casting laboratory is currently under construction at JHL. The status of that facility is unknown.
Key Sources: Jaber Ibn Hayan, AEOI Research Department, ; "Implementation of the NPT Safeguards Agreement in the Islamic Republic of Iran," International Atomic Energy Agency (IAEA), 26 August 2003, p. 5.
Updated November 2003

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Kalaye Electric Company
http://www.globalsecurity.org/wmd/world/iran/tehran-kalaye.htm
Satellite Imagery
Links
Jaber Ibn Hayan Research Department



Kalaye Electric Company, on the southern outskirts of the capital, Tehran, is a supplier to Iran's weapons industry. In early 2003 Iran admited that some centrifuge components were made at a workshop of the Kalaye Electric Company in Tehran. During the discussions in Iran in February 2003 between DDG-SG and the Iranian authorities, reference was made by the Agency to information in open sources on the possible conduct of enrichment activities at the workshop of the Kalaye Electric Company in Tehran. The Iranian authorities acknowledged that the workshop had been used for the production of centrifuge components, but stated that there had been no operations in connection with its centrifuge enrichment development programme involving the use of nuclear material, either at the Kalaye Electric Company or at any other location in Iran. According to the Iranian authorities, all testing had been carried out using simulation studies. While a centrifuge component production facility is not a nuclear facility required to be declared to the Agency under Iran's NPT Safeguards Agreement, Iran was requested, in light of its stated policy of transparency, to permit the Agency to visit the workshop and to take environmental samples there to assist the Agency in verifying Iran's declaration and confirming the absence of undeclared nuclear material and activities. The request was initially declined.
In February 2003, Iran acknowledged that the workshop of the Kalaye Electric Company in Tehran had been used for the production of centrifuge components, but stated that there had been no testing of these components involving the use of nuclear material, either at the Kalaye Electric Company or at any other location in Iran. According to Iran, its enrichment programme was indigenous and based on information from open sources.
In March 2003, during an Agency visit to the workshop at the Kalaye Electric Company, the Iranian authorities refused Agency access to one of the workshop buildings, claiming that the building was used for storage and that no keys to the building were available.
IAEA inspectors left Iran on 21 June 2003 after Iranian officials refused to let them visit the Kalaye Electric Company facility in Tehran. The inspectors had been refused the opportunity to take environmental samples at Kalaye. The IAEA had requested permission to take samples at a workshop at Kalaye where Iran had admitted to constructing components for centrifuges designed for enriching uranium. Iran was requested, in light of its stated policy of transparency, to permit the agency to visit the workshop and to take environmental samples there to assist the agency in ... confirming the absence of undeclared nuclear material and activities. The request was initially denied. The Iranian authorities told the agency that Iran considered such visits, and the requested environmental sampling, as being obligatory only when an Additional Protocol was in force. Iran initially indicated it would allow the IAEA team to take samples at Kalaye during their June 7-11 inspections, but then refused to allow the team to take samples.
During their 9-12 August 2003 visit to Iran, IAEA inspectors were permitted to take environmental samples at the Kalaye Electric Company workshop, with a view to assessing the role of that company in Iran's enrichment R&D programme. The results of the analysis of these samples are not yet available. It was noted by inspectors that there had been considerable modification of the premises since their first visit in March 2003. Iranian authorities have informed the Agency that these modifications are attributable to the fact that the workshop is being transformed from use as a storage facility to its use as a laboratory for non-destructive analysis. This modification may impact on the accuracy of the environmental sampling and the Agency's ability to verify Iran's declarations about the types of activities previously carried out there.
On 16 September 2003, the Agency met representatives of Iran to discuss the results of the analysis of the environmental samples taken at the Kalaye Electric Company in August 2003, which had revealed the presence of high enriched uranium (HEU) particles and low enriched uranium (LEU) particles which were not consistent with the nuclear material in the declared inventory of Iran.
Between 13 and 22 October 2003, an Agency inspection team conducted safeguards inspections at PFEP and other facilities in Esfahan and Tehran. These inspections included follow up activities related to the HEU and LEU particles found at the Kalaye Electric Company and at Natanz and to the newly acknowledged existence of nuclear material resulting from uranium conversion experiments.
On 16 October 2003, at the invitation of the Iranian Government, the Director General met in Tehran with H.E. Dr. H. Rohani, Secretary of the Supreme National Security Council of Iran, to discuss the open issues requiring urgent resolution. These issues related to the use of nuclear material in the testing of centrifuges (including the presence of LEU and HEU particles at the Kalaye Electric Company and at Natanz); the testing of conversion processes; the purpose of uranium metal production; the existence of laser isotope enrichment; and details of Iran's heavy water reactor programme.
In a letter to the Director General dated 21 October 2003, Iran acknowledged that: between 1998 and 2002 it had carried out some testing of centrifuges at the Kalaye Electric Company using UF6 imported in 1991; between 1991 and 2000 it had had a laser enrichment programme, in the course of which it had used 30 kg of uranium metal not previously declared to the Agency; and between 1988 and 1992 it had irradiated 7 kg of UO2 targets and extracted small quantities of plutonium. Attached to the letter was significant additional information with respect to those activities, as well as information concerning Iran's conversion and heavy water reactor programmes.
In its letter of 21 October 2003, Iran acknowledged that "a limited number of tests, using small amounts of UF6, [had been] conducted in 1999 and 2002" at the Kalaye Electric Company. In a meeting with enrichment technology experts held during the 27 October-1 November 2003 visit, Iranian authorities explained that the experiments that had been carried out at the Kalaye Electric Company had involved the 1.9 kg of imported UF6, the absence of which the State authorities had earlier attempted to conceal by attributing the loss to evaporation due to leaking valves on the cylinders containing the gas (see GOV/2003/63, para. 18). The equipment used between 1999 and 2000 at Kalaye Electric Company was suitable for pilot scale uranium isotope separation. As an isotope separation plant is defined in Article 98.I.(a) of the Safeguards Agreement as a facility, the existence of this facility should have been declared to the Agency.
As mentioned above, environmental samples taken by the Agency at PFEP and at the Kalaye Electric Company revealed particles of HEU and LEU indicating the possible presence in Iran of nuclear material that had not been declared to the Agency. The Iranian authorities attributed the presence of these particles to contamination originating from centrifuge components which had been imported by Iran. In connection with its efforts to verify that information, the Agency requested, and Iran provided in October 2003, a list of imported and domestically produced centrifuge components, material and equipment, and an indication of the batches of items that Iran claims to have been the source of the contamination. The Agency carried out another sample taking campaign in October 2003, at which time all major imported and domestically produced components, as well as various pieces of manufacturing equipment, were sampled.
The IAEA report of 10 November 2003 found that Iran had failed to report the use of imported natural UF6 for the testing of centrifuges at the Kalaye Electric Company in 1999 and 2002, and the consequent production of enriched and depleted uranium. It also found that Iran had failed to provide design information for the centrifuge testing facility at the Kalaye Electric Company.
Some reports place the Kalaye Electric Company at Ab Ali, situated at a distance of 75 Kilometers east of Tehran. The first ski area in Iran in which mechanical ski lifts were installed in 1332 (1953) was Ab Ali. Prior to that, typically, since the region enjoyed favorable climatic condition in summer, sportsmen and those who liked mountainous areas and skiing rushed to the region for its recreational facilities. Since Ab Ali is situated on the road of Tehran-North, many sportsmen were familiar with Ab Ali. Specific characteristics such as thermal spring water, Imam-Zade Hashem Holy Shrine and etc, have made the region much distinctive from other ski fields of Iran. This region is the birthplace of modern ski and the base of ski sport in Iran.
http://www.globalsecurity.org/wmd/world/iran/tehran-kalaye.htm
Maintained by John Pike
Last Modified: July 02, 2004 - 16:39
Copyright ? 2000-2004 GlobalSecurity.org All Rights Reserved


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Hard-line Iranian Lawmakers Reject Discussions With European Union on Nuclear Crisis
http://www.nti.org/d_newswire/issues/2004_8_11.html#2CD0E344
Members of Iran's parliament yesterday criticized Foreign Minister Kamal Kharazi for allegedly mishandling negotiations with France, Germany and the United Kingdom on the Islamic republic's nuclear program, Agence France-Presse reported (see GSN, Aug. 10).
"Why did we surrender to the demands of the Europeans and the West?" asked Akbar Alami, a member of the Majlis Foreign Policy and National Security Commission.
"I have even heard that one member of our delegation to the Paris negotiations told the Europeans that Iran would guarantee that it would not leave the Nuclear Nonproliferation Treaty if the Westerners did not take our case to the United Nations Security Council," he added.
"These sort of approaches undermine Iran's sovereignty," Alami said.
Ali Ahmadi, another conservative deputy, questioned why Iran agreed to allow tougher inspections under the Additional Protocol to the safeguards agreement with the International Atomic Energy Agency, even though parliament has not yet ratified that agreement.
Kharazi replied that Hassan Rohani, a powerful conservative cleric and head of Iran's Supreme National Security Council, maintained ultimate responsibility in the nuclear negotiations.
"The nuclear issue in Iran gets special treatment. Dr. Hassan Rohani, a well-known politician, is heading the case, while the Foreign Ministry and the atomic organization are helping him out," Kharazi said.
"The Islamic republic of Iran will never give up its right to peaceful nuclear technology, since we are not seeking production of nuclear weapons," he added (Agence France-Presse/Yahoo!News, Aug. 10).
Thus far, 150 members of parliament have signed a bill mandating that the Islamic republic acquire "peaceful nuclear technology," National Security and Foreign Policy Commission member Kazem Jalali said yesterday.
"According to the draft, the government will have to take action on access to peaceful nuclear technology by using the expertise of domestic scholars, researchers and facilities as well as fulfilling its commitments to the International Atomic Energy Agency within the framework of the Additional Protocol to the Nuclear Nonproliferation Treaty," he said, according to IRNA (IRNA, Aug. 10).

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http://www.fas.org/nuke/guide/iran/iaea061804.pdf


Board of Governors
GOV/2004/49
Date: 18 June 2004
Original: English
For official use only
Item 8(e) of the agenda
(GOV/2004/45)
Implementation of the NPT Safeguards
Agreement in the Islamic Republic of Iran
Resolution adopted by the Board on 18 June 2004
The Board of Governors,
(a) Recalling the resolutions adopted by the Board on 13 March 2004 (GOV/2004/21),
26 November 2003 (GOV/2003/81), and on 12 September 2003 (GOV/2003/69) and the
statement by the Board of 19 June 2003 (GOV/OR.1072),
(b) Noting with appreciation the Director General's report of 1 June 2004 (GOV/2004/34), on
the implementation of safeguards in Iran,
(c) Reiterating its appreciation that Iran has continued to act as if its Additional Protocol were in
force, and noting with satisfaction that Iran has submitted to the Agency the initial declarations
pursuant to that Protocol,
(d) Noting, however, that Iran has yet to ratify the Protocol as called for in previous Board
resolutions,
(e) Recalling Iran's voluntary decisions to suspend all enrichment-related and reprocessing
activities and to permit the Agency to verify that suspension; noting with concern that, as
detailed in the Director General's report, this verification was delayed in some cases, and that
the suspension is not yet comprehensive because of the continued production of centrifuge
equipment; also noting with concern that Iran's decision to proceed with the generation of UF6
is at variance with the Agency's previous understanding as to the scope of Iran's decision
regarding suspension; and further noting that Iran has withheld 10 assembled centrifuge rotors
for research activities,
(f) Encouraged by the Director General's assessment that there has been good progress on the
actions agreed during the Director General's visit to Tehran in early April 2004 and that the
Agency continues to make progress in gaining a comprehensive understanding of Iran's nuclear
programme, but noting with concern that after almost two years from when Iran's undeclared
programme came to the Agency's knowledge a number of questions remain outstanding, and in
particular two questions that are key to understanding the extent and nature of Iran's enrichment
International Atomic Energy Agency
Derestricted 18 June 2004
(This document has been derestricted at the meeting of the Board on 18 June 2004)
GOV/2004/49
Page 2
programme: the sources of all HEU contamination in Iran and the extent and nature of work
undertaken on the basis of the P-2 advanced centrifuge design,
(g) Noting in this context with serious concern that important information about the P-2
centrifuge programme has often been forthcoming only after repeated requests, and in some
cases has been incomplete and continues to lack the necessary clarity and also that the
information provided to date relating to contamination issues has not been adequate to resolve
this complex matter,
(h) Noting with appreciation that the Agency has received some information from other states
that may be helpful in resolving some contamination questions,
(i) Noting with concern that the Agency's investigations have revealed further omissions in the
statements made by Iran, including in the October declaration, in particular concerning the
importation of P-2 components from abroad and concerning laser enrichment tests, which have
produced samples enriched up to 15%, and also that Agency experts have raised questions and
doubts regarding the explanations provided by Iran concerning those programmes, which
require further clarification,
(j) Recognising the inalienable right of states to the development and practical application of
atomic energy for peaceful purposes, including the production of electric power, consistent with
their treaty obligations, with due consideration for the needs of the developing countries,
(k) Stressing the need for effective safeguards in order to prevent the use of nuclear material for
prohibited purposes in contravention of safeguards agreements and underlining the vital
importance of effective safeguards for facilitating cooperation in the field of nuclear energy, and
(l) Acknowledging the statement by the Director General on 14 June that it is essential for the
integrity and credibility of the inspection process to bring these issues to a close within the next
few months,
1. Acknowledges that Iranian cooperation has resulted in Agency access to all requested locations,
including four workshops belonging to the Defence Industries Organisation;
2. Deplores, at the same time, the fact that, overall, as indicated by the Director General's written
and oral reports, Iran's cooperation has not been as full, timely and proactive as it should have been,
and, in particular, that Iran 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;
3. Underlines that, with the passage of time, it is 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 calls 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;
4. Calls on Iran to take all necessary steps on an urgent basis to help resolve all outstanding
questions, especially that of LEU and 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;
GOV/2004/49
Page 3
5. Welcomes Iran's submission of the declarations under Articles 2 and 3 of its Additional Protocol;
and stresses 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;
6. Emphasises 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 urges Iran to ratify without delay its Protocol;
7. Recalls that in previous resolutions the Board called on Iran to suspend all enrichment-related
and reprocessing activities; welcomes Iran's voluntary decisions in that respect; regrets that those
commitments have not been comprehensively implemented and calls 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;
8. In the context of Iran's voluntary decisions to suspend all enrichment-related and reprocessing
activities, calls on Iran, as a further confidence-building measure, voluntarily to reconsider its decision
to begin production testing at the Uranium Conversion Facility 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;
9. Recalls that the full and prompt cooperation with the Agency of all third countries is essential in
the clarification of certain outstanding questions, notably contamination;
10. Commends 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;
11. Requests the Director General to report well in advance of the September Board - or earlier if
appropriate - on these issues as well as on the implementation of this and prior resolutions on Iran; and
12. Decides to remain seized of the matter.
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Qods (Jerusalem) Force
Iranian Revolutionary Guard Corps (IRGC - Pasdaran-e Inqilab)
While the Constitution of Iran entrusts the military with guarding Iran's territorial integrity and political independence, it gives the Revolutionary Guard [Pasdaran] the responsibility of guarding the Revolution itself. Established under a decree issued by Khomeini on May 5, 1979, the Pasdaran was intended to guard the Revolution and to assist the ruling clerics in the day-to-day enforcement of the government's Islamic codes and morality. The Revolution also needed to rely on a force of its own rather than borrowing the previous regime's tainted units.
By 1986 the Pasdaran consisted of 350,000 personnel organized in battalion-size units that operated either independently or with units of the regular armed forces. In 1986 the Pasdaran acquired small naval and air elements. By 1996 the ground and naval forces were reported to number 100,000 and 20,000, respectively.
Domestic Operations
The Pasdaran has maintained an intelligence branch to monitor the regime's domestic adversaries and to participate in their arrests and trials. Khomeini implied Pasdaran involvement in intelligence when he congratulated the Pasdaran on the arrest of Iranian communist Tudeh leaders. The Baseej (volunteers) come under the control of the Revolutionary Guards. In 1988, up to 900,000 baseej were mobilized. The Baseej allegedly also monitor the activities of citizens, and harass or arrest women whose clothing does not cover the hair and all of the body except hands and face, or those who wear makeup. During the year ending in June 1995, they reportedly "notified 907,246 people verbally and issued 370,079 written notices against ▒social corruption▓ and arrested 86,190 people, and also broke up 542 ▒corrupt gangs▓, arresting their 2,618 members, and seized 86,597 indecent videocassettes and photographs.
The Ashura Brigades force was reportedly created in 1993 after anti-government riots erupted in various Iranian cities and it consists of 17,000 Islamic militia men and women. The Ashura Brigades are reportedly composed of elements of the Revolutionary Guards (Pasdaran) and the Baseej volunteer militia
In August 1994, some Pasdaran units, rushed to quell riots in the city of Ghazvin, 150 km. west of Tehran, reportedly refused orders from the Interior Minister to intervene in the clashes, which left more than 30 people dead, 400 wounded and over 1,000 arrested. Subsequently, senior officers in the army, air force and the usually loyal Islamic Revolutionary Guard reportedly stated that they would no longer order their troops into battle to quell civil disorder. A Pasdaran commander was among four senior army officers who are said to have sent a letter to the country's political leadership, warning the clerical rulers against "using the armed forces to crush civilian unrest and internal conflicts." In a communiquИ sent to Ayatollah Ali Khameini, stated that "the role of the country▓s armed forces is to defend its borders and to repel foreign enemies from its soil, not to control the internal situation or to strengthen one political faction above another." They are said to have then recommended the use of Baseej volunteers for this purpose. In a move believed to indicate a shift in the trust of the ruling clerics from the Pasdaran to the Baseej volunteer force, on 17 April 1995 Ayatollah Ali Khameini reportedly promoted a civilian, veterinary surgeon Hassan Firuzabadi, to the rank of full general, placing him above both Brigadier-General Mohsen Rezai, commander-in-chief of the Pasdaran and Brigadier General Ali Shahbazi of the regular armed forces.
Foreign Operations
The foreign operations by the Guardians, which also encompass the activities of Hizballah and Islamic Jihad √ are usually carried out through the Committee on Foreign Intelligence Abroad and the Committee on Implementation of Actions Abroad. As with agents of Ministry of Intelligence, Pasdaran personnel operate through front companies and non-governmental organizations, employees or officials of trading companies, banks, cultural centers or as representatives of the Foundation of the Oppressed and Dispossessed (Bonyade-e- Mostafazan), or the Martyrs Foundation.
The Qods (Jerusalem) Force of the Iranian Revolutionary Guard Corps (IRGC) is responsible for extraterritorial operations, including terrorist operations. A primary focus for the Qods Force is training Islamic fundamentalist terrorist groups. Currently, the Qods Force conducts training activities in Iran and in Sudan. The Qods Force is also responsible for gathering information required for targeting and attack planning. The Pasdaran has contacts with underground movements in the Gulf region, and Pasdaran members are assigned to Iranian diplomatic missions, where, in the course of routine intelligence activities they monitor dissidents. Pasdaran influence has been particularly important in Kuwait, Bahrain, and the United Arab Emirates.
The largest branch of Pasdaran foreign operations consists of approximately 12,000 Arabic speaking Iranians, Afghans, Iraqis, Lebanese shi▓ites and North Africans who trained in Iran or received training in Afghanistan during the Afghan war years. Presently these foreign operatives receive training in Iran, Sudan and Lebanon, and include the Hizballah ["Party of Allah"] intelligence, logistics and operational units in Lebanon [Hizballah is primarily a social and political rather than military organization]. The second largest Pasdaran foreign operations relates to the Kurds (particularly Iraqi Kurds), while the third largest relates to the Kashmiri▓s, the Balouchi▓s and the Afghans. The Pasdaran has also supported the establishment of Hizballah branches in Lebanon, Iraqi Kurdistan, Jordan and Palestine, and the Islamic Jihad in many other Moslem countries including Egypt, Turkey, Chechnya and in Caucasia. Hizballah has been implicated in the counterfeiting of U.S. dollars and European currencies, both to finance its operations and to disrupt Western economies by impairing international trade and tourism.
The Office of Liberation Movements has established a Gulf Section tasked with forming a Gulf Battalion as part of the Jerusalem Forces. In April 1995 a number of international organizations linked to international terrorism --including the Japanese Red Army, the Armenian Secret Army, and the Kurdistan Workers' Party -- were reported to have met in Beirut with representatives of the Iraqi Da'wah Party, the Islamic Front for the Liberation of Bahrain, Hizballah, Iran's "Office of Liberation Movements," and Iran's Guardians of the Revolution. Tehran's objective was to destabilize Arab Gulf states by supporting fundamentalists with military, financial, and logistical support. Members of these and other organizations receive military training at a Guardians of the Revolution facility some 100 kilometers south of Tehran. A variety of of training courses are conducted at the facility for fundamentalists from the Gulf states, Egypt, Algeria, Tunisia, and Lebanon, including naval operations, mines, and diving operations in a special camp near the Orontes River.
Sources and Methods
SPECIAL AND IRREGULAR ARMED FORCES in IRAN - A Country Study Library of Congress Federal Research Division
"ISLAMIC REPUBLIC" OF IRAN EXPORT OF REVOLUTION FLAG OF FREEDOM ORGANIZATION OF IRAN (FFO) SPECIAL REPORT August 12, 1997
Counterfeit U.S. Currency Abroad: Issues and U.S. Deterrence Efforts (GAO Letter Report, 02/26/96, GAO/GGD-96-11)
"Alleged Extremist Plans To Destabilize Gulf" FBIS-NES-95-092 : 10 Feb 1995 [Source: Paris AL-WATAN AL-'ARABI , 10 Feb 95 pp 14-16]

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Chinese Kerry Out: John Kerry's Private Trade Trip to Beijing
Posted August 6, 2004
By Charles R. Smith
The Kerry campaign currently is struggling with recent photographs of the candidate, one dressed in a "bunny" suit at NASA and another on the bow of a ferry imitating a famous scene from the movie Titanic. However, a new photograph has emerged showing the Massachusetts senator in Beijing, People's Republic of China, working with a company associated with the Chinese military. The Kerry campaign and the Kerry Senate office both are refusing to comment on the Democratic presidential candidate's privately sponsored trade trip to China. Repeated phone calls both to Kerry's campaign headquarters and his Senate office were not returned.
During the late 1990s, John Kerry traveled on a "U.S. trade mission to the People's Republic of China organized and sponsored by a private corporation." The Kerry trip to Beijing was topped off with a "banquet in Beijing's legendary Great Hall of the People." To prove the trip was a success, the Massachusetts-based firm of Boston Capital & Technology photographed Kerry in the Beijing Great Hall of the People. The image and trip information appear at www.us-china.com, Boston Capital's Website
The photo shows Kerry, an unnamed Chinese government official and Paul Marcus, the head of Boston Capital & Technology. Marcus also refused to provide details of the China trip, including the time and date, whether the senator took money for his services, or the identity of the Chinese officials with whom Kerry met. "I am not doing an interview with you, and please don't call me again," Marcus declared.
The chief of Boston Capital and his Chinese-born wife, Moying Li, live in the same Beacon Hill district of Boston as Kerry, who used his half-interest in the family mansion to borrow $6.4 million to save his then-faltering presidential campaign.
While Marcus currently refuses to comment on the private trade trip to China, he does advertise his connection to Sen. Kerry on Boston Capital's Website, where Marcus claims that his firm was "China Advisor to U.S. Senator's commercial agenda for China." The Website goes on to says that Boston Capital: "Advised, assisted, and executed Minister-level commercial agenda for U.S. Senator. Advanced Senator in China for all Minister-level meetings, coordinated and acted as liaison to: The U.S. State Department, The U.S. Embassy in Beijing, The Department of Commerce, and all relevant Chinese authorities."
The Chinese Army Bank: In fact, Marcus is a business partner with the China International Trust and Investment Corp. (CITIC), a firm closely associated with the Chinese military and included on the Website a picture of himself meeting with CITIC officials in China. "Boston Capital & Technology is a bilateral contractual affiliate of both the China Council for the Promotion of International Trade (CCPIT), China's largest trade organization, and the China International Trust and Investment Corporation (CITIC), China's largest investment organization," the Website says.
CITIC is known as a front for the munitions manufacturer Poly Technologies Corp. According to a 1997 report prepared by the Rand Corporation, "Poly Technologies Ltd. was founded in 1984, ostensibly as a subsidiary of CITIC, although it was later exposed to be the primary commercial arm of the PLA [People's Liberation Army] General Staff Department's Equipment Sub-Department." The Rand report continues: "Throughout the 1980s, Poly sold hundreds of millions of dollars of largely surplus arms around the world, exporting to customers in Thailand, Burma, Iran, Pakistan and the United States. ... CITIC does enter into business partnerships with and provide logistical assistance to PLA and defense-industrial companies like Poly."
The Rand report notes that CITIC's Poly Group once tried to smuggle machine guns into the United States: "Poly's U.S. subsidiaries were abruptly closed in August 1996. Allegedly, Poly's representative, Robert Ma, conspired with China North Industries Corporation's (NORINCO) representative, Richard Chen, and a number of businessmen in California to illegally import 2,000 AK-47s into the United States."
Poly Technologies was run by international arms dealer Wang Jun and his "princeling" friend, the powerful He Ping, son-in-law of long-time Chinese leader Deng Xiaoping. The Rand Corporation noted that "Wang Jun is both director of CITIC and Chairman of Poly Group, the arms-trading company of the General Staff Department."
In 1996, Poly Chairman Wang Jun met with President Bill Clinton inside the White House with convicted Chinagate figure Charlie Trie, who donated hundreds of thousands of dollars to the 1996 Clinton/Gore campaign from Red Chinese sources. The Democratic Party later returned much of this donated money.
Satellites for China: While CITIC is reported by U.S. military authorities to be involved in the international sale of illegal arms it also is interested in obtaining advanced U.S. technology. The Boston Capital Website notes that the firm has been involved with the transfer of advanced U.S. space technology to China. Such references are viewed in the arms trade to have missile applications.
According to the Boston Capital Website, the company acted as a China adviser for a "U.S. High Technology Corporation's technology-transfer efforts in the People's Republic of China. They were responsible for technology transfer for full-scale manufacturing in China of technologies in telecommunications and satellites. ... Each production package sells for $15 [million] to $20 million. The Corporation has successfully transferred these [satellite] technologies to several Chinese manufacturers now in production."
It should come as no surprise that Marcus' partner in Beijing, CITIC, also owns a controlling interest in the Hong Kong-based Asia Satellite Telecom Co. Ltd. (AsiaSat). Founded in 1988, AsiaSat operates several communications satellites in the Far East bought from U.S. manufacturers including Hughes. According to Aviation Week and Space Technology, in addition to direct TV broadcasts, AsiaSat satellites regularly carry communications traffic for Chinese military units and Chinese military-owned companies.
Sweet Deal Turns Sour: Not all of the Marcus projects in Communist China have turned out so sweet. In 1998 the U.S. Department of Agriculture gave Marcus a $77,000 contract to produce a report on the cranberry market in China. By 2001, Marcus had spun the contract and report into a deal to put Massachusetts-based Ocean Spray in business with China's largest juice company, perhaps looking to find markets and perhaps outsourcing a traditional American industry.
According to an article published in March 2001 by the Beijing Business Wire, "Under an agreement with the Beijing Huiyuan Beverage Group, Ocean Spray, the number-one brand of canned and bottled juice drinks in the U.S., will grant a 10-year license to Huiyuan for the Ocean Spray brand and technology." The official Beijing business report stated that Ocean Spray "made its initial contact with Huiyuan through the consulting firm Boston Capital & Technology, which had a personal working relationship with its chairman, Zhu. Their rapport with Huiyuan management helped secure the agreement."
Critics of the Ocean Spray deal quickly warned that Huiyuan Beverage readily could become a global competitor. According to the Huiyuan Website, the Chinese beverage company imported more than 40 advanced sterile filling lines, and set up two juice-extracting plants and six filling factories. The cranberry deal with China turned sour. Today, Ocean Spray officials refuse to comment on the 2001 China deal with Huiyuan. Ocean Spray no longer lists Huiyuan as a partner or as an official outlet of its products. In fact, Ocean Spray does not list any outlet for its products in China, and China is a major producer of cranberries and a major juice competitor.
Many Faces, No Answers: Who Marcus was working for in the juice case is not entirely clear, but he has completed several other sweet deals. Marcus is the founder of a number of firms that do business with Beijing, including not only Boston Capital & Technology but Boston Business Consulting, Massachusetts-Guangdong Committee Inc. and China Development Holdings Ltd.
The Marcus business savvy also extends far beyond China. He once sold the Webpage name bbc.com to the British Broadcasting Corp. for about $350,000. The Boston-based consultant also has time for the arts. He and his wife are listed as founders of the nonprofit American Friends of the National Gallery of the Cayman Islands, a lovely place notorious for hiding and laundering money.
John Kerry frequently has stated that he has had contacts with high-ranking officials of foreign governments. Yet, the Kerry campaign is refusing to answer any questions about the candidate's privately sponsored trade trip to China or his relationship with Marcus. But it would appear that the presidential candidate has many friends at high levels in Beijing. The Chinese official Internet news outlet of the People's Daily, official newspaper of the Communist Party of China, recently endorsed the senator from Massachusetts for president of the United States.
Charles R. Smith is an investigative reporter specializing in military and information technology.

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Region-building in the Middle East
Martin Ortega, Bulletin n? 11, juillet 2004
While various summits in June have introduced several plans to promote political reform and cooperation in the `broader' Middle East, none of them is likely to change the desperate situation of that region. Without any doubt, these plans, which clearly follow the spirit of the EU's Barcelona process initiated in 1995, are steps in the right direction. However, they are not enough. They amount to giving aspirin and applying small plasters to someone who has suffered from a heart attack. The Middle East's afflictions are so complex and serious that they need another kind of treatment.
In spring 2003 President George W. Bush applied shock therapy to Iraq, but this therapy did not work as expected. The current political transition, endorsed by UNSC Resolution 1546, has certainly raised new hopes. Yet, the fact of the matter is that the bad security situation in the country might still make the completion of that transition very difficult. The wishful prospect of Iraq's new democracy expanding across the region has not worked either; for instance, the war in Iraq has led to neither more democracy nor more stability in Saudi Arabia, and terrorism is growing.
President Bush's shock therapy for the region has not worked because it is grounded on old Hobbesian methods. The assumption that forceful regime change would have prompted a friendly regime in Baghdad, which would have accepted an American military presence in Iraq, ignored basic twentieth century principles such as self-determination and democracy. The use of armed force - necessary as it is on some occasions - cannot be utilised today to impose a regional order while disregarding international legitimacy.
The Middle East needs a wholly different approach, inspired in the Kantian tradition of international relations. The circle of violence there must be stopped and replaced by a region-building process that ushers in a more positive atmosphere. Many deem this idea a senseless dream, which is understandable because old realist thinking cannot explain such schemes - and neither can it explain the European Union or the role of human rights in international relations. What is less understandable, though, is that many of those Hobbesian experts accepted the senseless idea of a democratic domino effect in the Middle East in the wake of a military intervention in Iraq.
Region-building is perhaps the most powerful, yet the most underestimated, feature of international politics in the last half century. This long-term therapy is the only possible solution to the Middle East's numerous problems; however, its implementation raises many thorny issues.
First, none of the previous experiments in region-building can be imported as such to the Middle East. However, we can draw lessons that are applicable to the region from all of them: the Marshall Plan, European economic integration, CSCE-OSCE, the 1991 Madrid Conference, NATO's Partnership for Peace, the Barcelona process and the Stability Pact for South Eastern Europe.
Second, region-building in the Middle East is such a huge undertaking that neither the United States nor the European Union can attempt it on its own. It goes without saying that local actors alone are unable to halt perverse historical dynamics. Therefore, the appropriate synergy between the three interlocutors must be found. The current vicious circle of violence must be transformed into a virtuous triangle.
Third, the profound transatlantic understanding needed to design an ambitious plan for the region is not conceivable in the current political circumstances. Following the November US presidential elections, irrespective of the result, a window of opportunity to discuss Middle East issues in depth will open.
Fourth, isolated treatment of specific conflicts and situations in the Middle East (Israeli-Palestinian conflict, Iraq's reconstruction, Iran's nuclear ambitions, political transitions, etc.) is no longer possible. We need to tackle all problems simultaneously in order to reach consequential agreements through strategic horse-trading. An international conference is perhaps the best way to start.
Finally, region-building in the Middle East will be a long-term process that must be based on a new balance of interests. An historic agreement that takes into account territorial, political, energy, economic and nuclear issues must be reached.
In the coming months the options will be clear: either we continue to attempt to manage periodical crises, which weaken both Europe and the United States, or we launch an ambitious regional plan that promotes peace in the region and reinforces both transatlantic allies' positions.


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North Korean Official To Attend N.Y. Seminar
Trip Builds on Contacts With the U.S.
By Glenn Kessler
Washington Post Staff Writer
Tuesday, August 3, 2004; Page A12
A senior North Korean official who threatened last year that North Korea might test a nuclear weapon will attend a foreign policy seminar next week in New York, allowing him to cross paths with U.S. officials attending the same meeting, diplomats said.
This is the second year in a row that Li Gun, deputy head of U.S. affairs at North Korea's Foreign Ministry, will attend the meeting of scholars and experts hosted by the National Committee on American Foreign Policy, a nonpartisan organization that focuses on resolving conflicts that threaten U.S. interests.
Li's trip to New York follows a rare visit to Capitol Hill last month by the North Korean ambassador to the United Nations and other signs that the Bush administration's resolve to avoid bilateral meetings with the North Korea could be weakening. Because North Korea and the United States do not have diplomatic relations, travel by North Korean diplomats in the United States requires permission from the State Department.
Donald S. Zagoria, a professor at Hunter College in New York who helped organize the meeting, said Li was invited to attend the conference Aug. 10-11.
Since North Korea began reprocessing plutonium for use in nuclear weapons last year, the Bush administration has pushed for negotiations with North Korea that also include China, Russia, Japan and South Korea and has allowed formal talks with North Korean officials only on the sidelines of those talks.
Democratic presidential nominee John F. Kerry has criticized the administration for declining to meet directly with North Korean officials to resolve the impasse. Since he leveled his criticism, U.S. negotiators at six-nation talks in June met one-on-one for more than two hours with their North Korean counterparts. Secretary of State Colin L. Powell spoke with the North Korean foreign minister for 20 minutes in July in Jakarta, Indonesia, and the North Korean ambassador was permitted to make his trip to Washington.
Diplomats said that several State Department officials are expected to attend the New York conference, including Joseph R. DeTrani, special envoy for negotiations with North Korea. But State Department spokesman J. Adam Ereli said "there are no plans for bilateral meetings between him [Li Gun] and U.S. officials."
During talks in Beijing in April 2003 between the United States, North Korea and China -- when the White House had ordered Assistant Secretary of State James A. Kelly not to meet with North Korean officials alone -- Li cornered Kelly at a dinner anyway and announced that North Korea possessed nuclear weapons and might test or transfer them. His government might be willing to end its nuclear projects, Li added, if the United States would change its approach toward North Korea.
Since then, three more rounds of talks on North Korea's nuclear ambitions have been held in Beijing in the past year -- also including Russia, Japan and South Korea -- but none has produced a breakthrough. DeTrani last week traveled to Beijing for consultations with the Chinese on setting up a round of working-level talks later this month, in preparation for senior-level talks in September.
In June, the administration offered a more specific proposal for ending the impasse, which included a three-month window for verifying North Korea's disclosures about its nuclear programs. But last week North Korea issued a statement denouncing the U.S. proposal as "nothing but a sham offer."

2004 The Washington Post Company

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Bin Laden hints major assassination
By Bill Gertz
THE WASHINGTON TIMES
U.S. intelligence officials say a high-profile political assassination, triggered by the public release of a new message from Osama bin Laden, will lead off the next major al Qaeda terrorist attack, The Washington Times has learned.
The assassination plan is among new details of al Qaeda plots disclosed by U.S. officials familiar with intelligence reports who, speaking on condition of anonymity, said the killing could be carried out against a U.S. or foreign leader either in the United States or abroad.
The officials mentioned Saudi Arabia and Yemen, two nations that are working with the United States in the battle against al Qaeda, as likely locales for the opening assassination.
The planning for the attacks to follow involves "multiple targets in multiple venues" across the United States, one official said.
The new details of al Qaeda's plans were found on a laptop computer belonging to arrested al Qaeda operative Muhammad Naeem Noor Khan of Pakistan.
"We're talking about planning at the screwdriver level," one official said. "It is very detailed."
Khan was arrested July 13 in Lahore, Pakistan, along with Ahmed Khalfan Ghailani, a Tanzanian who was indicted in the 1998 U.S. Embassy bombings in Africa and was on the FBI's list of most-wanted terrorists.
U.S. and allied counterterrorism officials are pursuing leads on other terrorists based on the data from Khan's seized laptop. At least one arrest in Britain has been made so far, and others are expected, the officials said.
Additionally, U.S. intelligence officials said they think that several al Qaeda terrorists already in the United States are part of the plot, although their identities and locations are not known.
The targets, in addition to the financial institutions in New York, Washington and Newark, N.J., that have been the subject of public warnings, include such economic-related targets as oil and gas facilities with a view toward disrupting the November election.
"The goal of the next attack is twofold: to damage the U.S. economy and to undermine the U.S. election," the official said. "The view of al Qaeda is 'anybody but Bush.' "
The officials also said the terrorist group has begun using female members for preattack surveillance and possibly as suicide bombers, thinking that women will have an easier time getting past security checkpoints at airports, borders and ports.
The al Qaeda attack plans call for bombings using trucks and cars, and hijacked aircraft, including commercial airliners and helicopters.
"There is a particular concern that chemical trucks will be used," one official said.
Regarding the new bin Laden message, the officials said there are intelligence reports, some of them sketchy, that a new tape from the al Qaeda leader will surface soon.
In the past, video and audio messages by bin Laden or his deputy, Ayman al-Zawahri, were broadcast days or weeks before an attack, the officials said.
"The message likely will be the signal for the attack to be launched," one official said.
A second U.S. official said one intelligence agency was aware of unconfirmed reports of a new bin Laden tape.
"There may be such a tape, but it hasn't surfaced and we haven't seen it," this official said.
Bin Laden last released a taped message in April. The CIA said that the audiotape probably was the voice of bin Laden and that the mention of the March 11 Madrid train bombings shows that the tape was current.
That tape offered a "truce" for any European state that pledged to stop attacking Muslims and end cooperation with the United States.
Contrary to what some Democratic critics of the Bush administration have said, intelligence officials said the new details of al Qaeda planning were obtained from the Khan laptop. The terrorist group was in the process of updating older attack plans, the officials said.
On Aug. 2, the Bush administration raised the terrorism threat level from "elevated" to "high" for five finance-related sites in the District, New York and New Jersey, based on the intelligence in Khan's computer, as well as other intelligence.
Frances Townsend, a White House homeland-security adviser, said Sunday that the government has received a steady "stream" of intelligence indicating that an al Qaeda attack is planned.
"What we know now that we didn't know six months ago is that they've done a good deal of planning and surveillance work to accomplish that goal," she said on CBS' "Face the Nation."


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FCW.com August 2, 2004
FBI picks 10 firms for tech support project
In-Depth Coverage
BY Dan Caterinicchia
As part of their information technology transformation, FBI officials recently issued the first operations and maintenance task orders for their Technical Support and Development Project (TSDP).
TSDP "is a standard contracting vehicle in which numerous businesses apply to provide specific technical skill sets to the FBI," an FBI spokesperson said. Officials hired the experts to advance their IT transformation.
The indefinite-delivery, indefinite-quantity contract has a potential value of $42.5 million during a five-year period. The contract, awarded June 18, covers operational IT support services such as information assurance, cybersecurity, configuration management, technology policy and planning, maintenance, upgrades, Web integration and application development.
The 10 prime contractors -- all of which are small businesses -- are McDonald Bradley Inc., Pragmatics Inc., AlphaInsight Corp., Comso Inc., Data Computer Corp. of America, Innovative Management and Technology Approaches Inc., InfoPro Inc., Staffing Alternatives Inc., Glotech Inc. and Project Performance Corp.
The small-business teams will support various financial, investigative, intelligence and electronic document management systems.
McDonald Bradley officials are leading a team of seven partners that will perform work at the FBI headquarters in Washington, D.C., and at other designated facilities. Staff who work on the project will hold top-secret clearance credentials, said Kenneth Bartee, president and chief executive officer of McDonald Bradley. He added that he expects to have more than 40 employees dedicated to the FBI work once the bureau progresses past the current transition phase.
Bartee said the FBI has already issued 10 task orders, mostly for operations and maintenance of existing systems.
"There's no new development work in the first 10 tasks," Bartee said, adding that the maintenance tasks cover everything from financial management to agent field support systems.
McDonald Bradley officials responded to two of the requests, he said. "It's moving pretty quickly from contract to award."
McDonald Bradley's visual intelligence tools allow clients in the intelligence community to easily and graphically analyze large, diverse information sets. Bartee said improved data sharing is critical for all federal law enforcement and defense agencies.
"How do you get just what you're looking for and not all the garbage" to agents in the field and in field offices? Bartee asked. "That is the key challenge right now."
Once new development work begins in areas such as information sharing, the small businesses will be able to show the FBI some state-of-the-art technologies that "big integrators are slow to bring to the table," Bartee said.
"Some small businesses can do things better than the big guys -- some can't," said George Smith, a senior fellow at GlobalSecurity.org. He added that he was not surprised that FBI officials are using only small businesses on this project because that has been a well-established practice throughout the federal government.
"And not all big contractors are flat-footed or clueless," he said. "You'd have to judge on a case-by-case basis, particularly in the computer software industry."
Caterinicchia is a freelance writer based in Washington, D.C.
Copyright 2004, FCW.com is a product of FCW Media Group, a division of 101communications LLC.
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Training Technology Against Terror
http://www.fas.org/main/content.jsp?formAction=297&contentId=71
Contact : Kay Howell (khowell@fas.org)
Last modified : April 27, 2004 10:41 AM
Millions of individuals need to be trained to respond to biological, chemical, radiological, and other terrorist attacks. In addition, they must be continuously retrained to ensure that their skills are sharp and their information current. The information they need to master is complex and can be difficult to retain since few, if any, of the people needing the training will have any first-hand experience with WMD incidents.
Our Training Technology Against Terror project is focused on promoting the use of advanced information technologies to provide local officials, public health providers, emergency responders, and hospital workers with timely, accurate information and identifying and reacting to incidents involving weapons of mass destruction.
Our Mass Casualty Incident game is designed to train first responders in the essential skills in the instance of a mass casualty situation.
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U.S., North Korean Officials Discuss Crisis; Japan Asks Libya for Korea Nuclear InformationАктуальные темы и анализ

Senior U.S. and North Korean officials attended a conference yesterday that included discussions of six-party talks on Pyongyang's nuclear program, the Associated Press reported (see GSN, July 21).
Joseph DeTrani, U.S. special envoy for negotiations with North Korea, and Li Gun, deputy head of U.S. affairs at North Korea's Foreign Ministry, attended the two-day, closed-door Conference on Northeast Asian Security in New York, organized by the National Committee on American Foreign Policy. There were unconfirmed reports of the two conferring during a break.
However, the United States plans to pursue a resolution to the nuclear standoff through multilateral negotiations and has no plans to engage Pyongyang directly, according to U.S. officials.
"We're not seeking a bilateral negotiation with the North Koreans. We are seeking a multilateral solution to a problem of multinational interest, and we think the best way is the six-party talks," said a U.S. State Department official.
Two topics of yesterday's session were "Perception of the Six-Party Talks" and the "U.S. Proposal and Reaction to It," according to the Associated Press. Speakers included DeTrani, Li, and Chinese diplomat Yang Xi Yu, director of the Korean Peninsula office.
"A positive and constructive conversation was held and the participants discussed frankly and openly," Yang said at the conclusion of the session (Associated Press/Boston Herald, Aug. 11).
Meanwhile, a Japanese official requested yesterday that Libya provide information about North Korea's nuclear and missile programs, Jiji Press Ticker Service reported.
Senior Vice Foreign Minister Ichiro Aisawa requested the assistance from his visiting Libyan counterpart, Mohamed Siala. He also called on the North African nation to exert pressure on Pyongyang to resolve the nuclear crisis.
Libya is prepared to play an important role in the issue of weapons of mass destruction and missiles, Siala is reported to have told Aisawa in response to the appeal (Jiji Press Ticker Service, Aug. 10).


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Договор о всеобъемлющем запрещении ядерных испытаний (ДВЗЯИ)
Проф. Лоренс Шайнман
Офис ЦИПН в Вашингтоне
апрель 2002 г.
Введение
Подготовка к подземным ядерным испытаниям в Неваде
Договор о всеобъемлющем запрещении ядерных испытаний (ДВЗЯИ) был открыт для подписания в сентябре 1996 года; он считается "самой трудной и долгожданной победой в истории договоров о контроле над вооружениями". Подписавшие и ратифицировавшие Договор государства обязуются "не производить любой испытательный взрыв ядерного оружия или любой другой ядерный взрыв". Для обнаружения взрывов и проведения инспекций по запросу стран, имеющих подозрения в нарушении положений Договора, он предусматривает создание широкомасштабной Международной системы мониторинга. Построение этой системы поручается вновь создаваемой Организации по Договору о всеобъемлющем запрещении ядерных испытаний со штаб-квартирой в Вене.
Для вступления в силу Договор должен быть ратифицирован 44 государствами, обладавшими в 1996 году исследовательскими или энергетическими ядерными реакторами. К настоящему моменту Договор подписало 41 государство, но лишь 31 его ратифицировало. Среди не подписавших Договор стран - Индия, Северная Корея и Пакистан. Соединенные Штаты выступили инициаторами усилий по заключению ДВЗЯИ и первыми поставили под ним свою подпись, но, наряду с Китаем, остаются в списке стран, подписавших, но не ратифицировавших Договор. В 1999 г. против ратификации Договора проголосовал Сенат США, без согласия и совета которого международные договоры не могут вступать в силу и иметь обязательный характер. Отказ в ратификации объясняется не только раскладом партийных интересов в Сенате, но и неуверенностью в том, что Договор сможет обеспечить дальнейшую безопасность, сохранность и надежность американских ядерных арсеналов и что предусмотренная им система проверок позволит эффективно обнаруживать испытания малой мощности. Новая администрация президента, в целом скептически относящаяся к ряду договоров о контроле над вооружениями, заявила, что не будет настаивать на проведении новых сенатских слушаний по ДВЗЯИ. При этом она выступает за поддержание объявленного всеми странами добровольного моратория на испытания, а также за сохранение и окончательное формирование Международной системы мониторинга, так как она, по мнению администрации, эффективно дополняет имеющиеся у США национальные системы обнаружения. Тем не менее, администрация не поддерживает выделение средств и участие в мероприятиях, связанных с местными проверками, которые после вступления Договора в силу будут проводиться в рамках более общего механизма инспекций по запросу.
Введение Краткий обзор Материалы по теме


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South Korea to move capital 100 miles south
Rural region will become huge building site for new city
Jonathan Watts in Beijing
Thursday August 12, 2004
The Guardian
The South Korean government confirmed yesterday that it is to create a new capital in what will be one of Asia's biggest ever construction projects.
Under the ?26bn scheme, a site in the sleepy region of Gongju-Yongi 100 miles south of Seoul will replace it as the seat of parliament and government by 2020. Despite sharp divisions among the public and the mixed results of similarly ambitious projects by other states, president Roh Moo-hyun insists relocation is necessary to ease chronic overcrowding in Seoul, redistribute the state's wealth, and lessen the danger of a bombardment by North Korea.
Gongju-Yongi is a hilly, rural area in Korea's midlands. Its selection was finalised yesterday - although an appeal has been made to the constitutional court - and caused joy among local farmers expecting a property boom.
Under the plan, announced by the prime minister, Lee Hae-chan, the government will start buying 7,100 hectares (17,540 acres) next year. After construction starts in 2007, the administration hopes to begin moving 230,000 employees into 85 ministries and institutions within five years. With the addition of the constitutional court, a national assembly and the presidential palace, it is expected that this region of 140,000 people will become home to half a million. To fund the move, the government will sell off most of the state's property in Seoul, including the presidential Blue House.
The idea is to create a centre of government similar to Washington DC, while leaving Seoul as a business, financial and cultural capital equivalent to New York. Previous development plans for what is Asia's third biggest economy have concentrated so much money and power in Seoul that the city and its environs are home to almost half of South Korea's 48 million population. By comparison, one in nine Britons lives in London.
President Roh made relocation a pillar of his election campaign, and says it is vital to improve conditions in Seoul by reducing its population by a tenth. A move 100 miles south also takes the government out of the range of much of North Korea's weaponry.
Opponents in the Grand National party argue that the scheme is vote-buying and will cost two or three times times the estimate. Many newspapers have called for further investigation, and civic groups have challenged the plan's validity; the constitutional court must rule within six months if it is to go ahead.
Surveys indicate that the public is evenly split. Most feel the question should be put to a referendum, something the president has refused to accept. The fiercest criticism has been in Seoul, where the mayor, Lee Myung-bak, has warned that relocation would undermine the competitiveness of South Korea as a business hub.
In a battle of wills, the city authorities pulled down subway advertisements by the central government which claimed that Seoul had the worst standard of living among the world's 20 biggest cities. Another discarded poster featured a cartoon of a cramped Seoul businessman watching enviously as a Chinese rival pedals across the expanse of Beijing's Tiananmen Square on his bicycle. The caption read: "Ten reasons why foreign companies choose Beijing rather than Seoul."
It is far from certain, however, that foreign businesses or countries favour relocation. Newspapers report several negative comments by diplomats concerned at the cost of moving. The United States embassy, now in the process of moving within Seoul, said it had no plan to shift again in the foreseeable future.
Such hesitation is inevitable, given the history of Korea's itinerant capital. Yongi country was a centre of government once before - during the Paekyae dynasty 1,500 years ago. Its second opportunity may not last long. If the peninsula re-unifies, there are likely to be calls for the capital to be moved north again, possibly even back to Pyongyang - another ancient seat of government.
City swaps
? In 1956 Brazil's capital moved from lively, crowded Rio to remote Brasilia. But spectacular buildings alone failed to attract the crowds
? Australia's government decided to build Canberra in 1908. A functional, elegant city was created, though many residents escape to Sydney for nights out
? In a symbolic gesture, the German government moved from Bonn to Berlin in 1991. But resources are still split between the two cities
? Though Tokyo earthquake fears prompted Japan's government to look for a new home, no move is likely soon

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Burst pipe points a finger at nuclear dangers

Many people probably remember how the nation was rocked in 1976 by the Lockheed payoff scandal that involved former Prime Minister Kakuei Tanaka.
That same year, the nuclear power reactor in Mihama, Fukui Prefecture, where a serious and sad accident occurred on Monday, was put into operation.
Four workers were killed and seven injured at Kansai Electric Power Co.'s Mihama Nuclear Power Plant when they were sprayed by highly pressurized steam that spewed out of a ruptured pipe inside the plant's No. 3 reactor.
The ruptured section of the pipe in question should have been inspected regularly. But never once had it been inspected since the reactor was put into operation. The section was not registered on the list of spots to be checked, and for a long time, nobody noticed its absence from the list.
Worse still, even when its absence was noticed last year, the power firm put off a checkup on the section, according to news reports.
Newspaper photographs show a terribly disfigured pipe, broken as if slashed by a sharp-edged knife and curling like a piece of paper.
The pipe material, originally 1 centimeter thick, had been reduced to 1.4 millimeters at the thinnest sections. No wonder that pipe, surely a shining brand-new product when it was installed in 1976, had worn out and was left looking like a brown rag.
What British mathematician and philosopher Bertrand Russell (1872-1970) said in his ``Sceptical Essays'' may be worth recalling in this connection. He wrote: ``Machines are worshipped because they are beautiful, and valued because they confer power; they are hated because they are hideous, and loathed because they impose slavery.'' (A Japanese translation has been published as part of the Kadokawa paperback series.)
The ruptured pipe was nearly 60 centimeters in diameter. At different times, it might have struck people as beautiful or as a powerful arm supporting a huge system for nuclear power plant. But it has taken on a fearful aspect now.
We should take the ugly transformation as a sign that the pipe is pointing a finger of accusation at Kansai Electric for failing to fulfill its heavy responsibility by neglecting a regular checkup-an important form of dialogue with machinery.
But is that all the disfigured pipe is doing? As I looked at the newspaper photos of the pipe, it seemed to me that the pipe was silently asking the authorities and consumers a question: How much should we rely on nuclear power generation, which always has the potential of running out of control?
--The Asahi Shimbun, Aug. 11(IHT/Asahi: August 12,2004) (08/12)

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Pipe at N-plant not checked even once
The Asahi Shimbun
Kansai Electric Power Co. officials talk about the fatal accident at the power company's head office in Osaka on Tuesday. Hiroshi Matsumura, head of the company's nuclear power division, is in the center.
A subcontractor noticed and informed the company, which put off making an inspection.
OSAKA-A ruptured pipe that burst in a torrent of high-pressure steam that killed four workers at the Mihama Nuclear Power Plant on Monday had never once been checked in the 28 years the facility has been in operation, officials acknowledged Tuesday.
The admission is bound to raise questions about the state of Japan's nuclear power plants as one in three of the 52 reactors now in operation is at least 25 years old. Another issue, of course, concerns scrupulous adherence to maintenance and safety measures.
Seven other workers were injured, some critically, by scalding steam on Monday. An estimated 800 tons of superhot coolant water was discharged, officials said.
It was the worst accident at a nuclear power plant in terms of deaths and injuries.
Kansai Electric's in-house rules stipulate that the portion of coolant water pipe that ruptured should have been inspected. But Mitsubishi Heavy Industries, which was contracted to compile inspection ledgers, failed to enter the pipe in question in the checklist. Kansai Electric workers also failed to notice the omission.
However, an employee with another company that took over Mitsubishi Heavy Industry's work for the plant did notice the omission in April last year and informed Kansai Electric.
Even so, the company put off the inspection until the regular annual reactor checkup that was due to start this Saturday, officials said.
The pipe in question, which is part of the secondary cooling system, is inside the No. 3 reactor's turbine building. The steam, fortunately, is not radioactive.
The carbon steel pipe is about 56 centimeters in diameter and was about 1 cm thick when it was installed in 1976.
Officials of Kansai Electric acknowledged in a news conference at the company's head office in Osaka on Tuesday that the pipe should have been inspected for corrosion but was overlooked.
After the accident, officials found the pipe had corroded from its original 1-cm thickness to 2-3 millimeters in places and even 1.4 mm in one area.
The absolute minimum thickness of the portion of the damaged pipe should have been 4.7 mm, according to the company.
Officials said tears in the top portion of the pipe running through the ceiling of the second floor of the turbine building measured up to 57 cm in one place.
The dead and injured men were working about 10 meters away when the pipe started spewing 142-degree steam at high pressure.
Fukui prefectural police are investigating the incident as a case of professional negligence resulting in deaths. Aside from questioning Kansai Electric officials, police will conduct autopsies on the victims to discover more about the way they died.
The cause of the corrosion may be due to a device called an orifice flowmeter that was installed inside the pipe to measure and regulate the flow of coolant water. The diameter of the pipe that ruptured was about 34 cm because of the device, instead of the 56 cm that should have been standard, according to the company.
Company officials could offer no other explanation for the corrosion. They noted that the pace of erosion might have been hastened because the pipe was narrower at the point where the flowmeter was installed. That interfered with the flow of the water.
From 1990 and 2003, the company carried out extensive checks on pipes in the secondary coolant system for its eight reactors. The pipes are similar to those installed at Mihama's No. 3 reactor.
Pipe erosion was discovered at the No. 1 reactor of the Oi Nuclear Power Plant and the No. 3 reactor of the Takahama Nuclear Power Plant, both in Fukui Prefecture, that have orifice flowmeters installed in roughly the same spot as in the case of Mihama's No. 3 reactor. The pipes were replaced with stainless steel tubing.
A similar accident occurred at the Surry Power Station in the U.S. state of Virginia in 1986. It, too, claimed four lives because erosion in a pipe had gone unchecked.
Inspections of condenser pipes were stepped up in the United States as a result.
The Mihama No. 3 reactor is one of 20 reactors that went into operation in the 1970s.
Experts criticized Kansai Electric for its slow-paced inspection of pipes. Its in-house rule requires checks on a quarter of all pipes in the secondary coolant system every 10 years.
That means it takes four decades to complete inspections of all pipes.(IHT/Asahi: August 11,2004) (08/11)


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Strip Poker
It's time for the U.N. to bare all and release its Oil-for-Food documents.
BY CLAUDIA ROSETT
Wednesday, August 11, 2004 12:01 a.m. EDT
A hallmark of the United Nations Oil-for-Food relief program in Iraq was secrecy, which served Saddam Hussein all too well. Since Oil-for-Food ended last November, its records have been handled with . . . yet more secrecy. And while I must confess to a certain relief that these remain largely locked up, thus excusing the press from any immediate responsibility to slog knee-deep through piles of old sanctions-busting "Dear Uday" documents, this secrecy does not serve the interests of the world public, nor is it a gift to anyone who would like to see the U.N. function as an honest institution.
The problem at this stage is not a lack of investigations, there being at least nine of these now in motion, including the U.N.'s own inquiry into itself, headed by former Federal Reserve Chairman Paul Volcker--who now has the monopoly on the U.N.'s central hoard of Oil-for-Food records. But don't hold your breath waiting for results. At a press conference Monday, Mr. Volcker said that his Independent Inquiry Committee, which is looking into such matters as the Oil-for-Food "payoffs, bribes, kickbacks, overcharges, undercharges," may not be ready to issue a report until the middle of next year.
Meanwhile, with major policy being made right now, involving among other things, Iraq, the U.N., and the War on Terror, the U.N. stash remains confidential. So do the vast stores of Oil-for-Food documentation in Baghdad. All told, the reported inventory of paperwork is staggering. The U.N., according to Mr. Volcker, has upwards of 15 million documents related to Oil-for-Food, or about 10,000 boxes worth so far, with more expected to turn up. In Baghdad, where many government offices reportedly kept detailed records of various aspects of Saddam's deals, the Iraq Interim Government apparently has tons more Oil-for-Food related documents, the circumstances of which have been variously described by U.S. or Iraqi officials in recent months as frozen, locked down and gathered in one place--bringing to mind a sort of Yucca Mountain of toxic finance. One can only hope that wherever this giant data dump might be located, it is very carefully guarded against those with an interest either in destroying potentially damning information, or using it selectively and quietly to blackmail Saddam's former cronies, some of whom may still wield power on the world stage.
And then, of course, there's the hoard of documents allegedly held by Ahmad Chalabi, head of the Iraqi National Congress. Mr. Chalabi was one of the first to call for serious investigation of Oil-for-Food, based on what he has described as "damning documents" found in government offices in Baghdad, implicating senior officials of both the U.N. and various unnamed nations. Mr. Chalabi, according to his Washington-based adviser, Francis Brooke, recovered enough of Saddam's paperwork last year to fill three basketball courts chest-high. Of this hoard, says Mr. Brooke, some 20,000 pages relate directly to Oil-for-Food, most of them from the files of the Finance Ministry--which was just one of the many Iraqi ministries involved in this program.
Since Mr. Chalabi first called for that investigation, the discrediting in some quarters of anything he has to say, including his charges about Oil-for-Food, has proceeded apace. In May, U.S. authorities raided his home and office. This week an Iraqi judge issued a warrant for Mr. Chalabi's arrest, on counterfeiting charges--an intriguing allegation in an environment where a considerable number of still un-arrested people appear to have been involved for years in the embezzlement of billions of entirely genuine dollars, hand-over-iron-fist.
The effect, especially with all the secrecy surrounding the officially-held records of Oil-for-Food, has been to tie allegations about Oil-for-Food to whatever doubts now surround the rest of Mr. Chalabi's activities. In recent weeks, I have received notes suggesting that if Mr. Chalabi was the main source for the Oil-for-Food story, it may be time to rethink. Actually, it is time to reclarify. Mr. Chalabi, for this columnist, at any rate, was never a major source. Oil-for-Food was a program so vast, so obviously packed with perverse policies and incentives, and so disturbing to a number of honest people who encountered it--including some sources quite close to the U.N.--that the array of whistle-blowers is extensive and highly varied. The difficulty, over and over, has been to get at some of those umpteen zillion confidential documents, which might help substantiate exactly who did exactly what to produce the biggest aid scam in U.N. history. (Or, if you prefer, might perhaps clear Saddam's name by demonstrating that he was, after all, a much-maligned do-good kinda guy, trying his best to bring baby food to the people of Iraq).
Oil-for-Food was a deal between Saddam and the U.N., in which, to my knowledge, Mr. Chalabi, an avowed long-time foe of Saddam, was not invited by either party to ride the gravy train. Rather, Mr. Chalabi was one of the early messengers, bringing specific tidings that the program was rotten. All the signs so far suggest that whatever else he may be accused of, he was right about this. Since Mr. Chalabi kicked off an investigation this past spring (which was promptly blocked by the U.S. administration), U.N. Secretary-General Kofi Annan, Paul Volcker, the U.S. Justice Department, and five congressional teams have followed suit.
Nor has Mr. Chalabi been a solo voice in noting that high officials of various stripes, in various counties, might be implicated in Oil-for-Food. On March 30 of this year, CIA chief weapons inspector for Iraq, Charles Duelfer, testified to the Senate Armed Services Committee that of the billions skimmed from Oil-for-Food, Saddam's regime "channeled much of the illicitly gathered funds to rebuild Iraq's military capabilities," importing "banned weapons and technology and dual-use goods through Oil-for-Food contracts."
Perhaps most immediately intriguing, even with Saddam gone from the scene, Mr. Duelfer in the same testimony, said: "Companies in several countries were involved in these efforts. Direct roles by government officials are also clearly established."
Direct roles? Which countries? What government officials?
At least some of the evidence, one might suppose, is socked away among the umpteen zillion documents to which the public has no access--save when here or there, someone chooses to leak a sheaf or two. Until the various investigations start to report in--and they seem to be taking their time about it--we won't even necessarily know just which aspects they are examining, and which they might choose to leave out.
Meanwhile, in effect, the Oil-for-Food papers have become poker cards held by various players in a high-rolling global backroom game that lends itself to such practices as blackmail. In some ways, these documents have begun to resemble a form of currency. Maybe we should simply make that official, and ask former Fed Chairman Volcker to start open market operations now.
Certainly Mr. Chalabi's best defense, in Oil-for-Food matters, would be to disclose the documents he says he's got. But the responsibility hardly begins there. The U.N. should have disclosed its records from the start. The keepers of these documents would be wise to release them today, or at least allow public access to the databases both extant and now being assembled. The secrets packed away with those Oil-for-Food papers are the spawn of a sick and predatory system. There can be few endeavors more cynical and ugly than skimming funds meant for sick and hungry people, and few rationales more alarming than the idea that everyone was doing it--especially if "everyone" includes officials still in positions of public trust. The best cure is daylight. Or, to borrow one of Mr. Volcker's best lines: Let the chips fall.
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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Defining Democracy Down
The problem with Keyes in Illinois.
American democracy is in sorry shape these days.
Usually, when I hear pronouncements of this sort, my eyes roll and I start counting ceiling tiles. Indeed, as a democracy curmudgeon, I applaud most of the things democracy fetishists complain about. I wish it were harder to vote and that fewer people did it.
The Founding Fathers understood that voting in itself is value-neutral. A mob can vote to lynch an innocent man, but that doesn't make it moral. Conversely, few things would be more morally admirable than a man of good conscience thwarting the "democratic will" of the mob to save the same innocent man's life.
Democracy must be tempered by not only the rule of law, but by custom, good will, good faith, and good character. Whenever I speak to college students I try to explain to them that the "liberal arts" aren't a description of Michael Moore's cinematic skills. The liberal arts describe the bundle of skills and learning necessary for citizens to both deserve and protect their freedom.
Anyway, what's got me grumpier than usual about democracy in America is the candidacy of Alan Keyes. After a comedy of political errors and just plain bad luck, the Illinois GOP found itself without a candidate to challenge the popular African-American Democrat Barack Obama for the open U.S. Senate seat. So Keyes, a former U.N. ambassador, two-time presidential candidate, and a radio show host, accepted an invitation to run. One problem: Keyes is from Maryland -- indeed he ran for the Senate once already in that state.
Now, I like Keyes. He's one of the best rhetoricians in America. Off the cuff he can articulate very conservative positions on everything from abortion to the United Nations better than most politicians can in prepared speeches. Indeed, this may turn out to be a great race. Two hyper-educated, successful, and civil African-American men with very different philosophies vying for a Senate seat in the land of the Lincoln-Douglas debates. No matter who wins, Illinois will have the only black Senator in Washington. Even better, race won't be much of an issue between the two because, as Keyes puts it, "if you are racist you have no one to vote for."
That's great stuff.
Except for the pesky fact that the Keyes candidacy is the latest example of a disturbing trend in which both parties are overturning the norms of democracy, with help from the media. Just in the last few years we've seen a dead man (dubiously) elected out of sympathy in Missouri, so that his widow could get a Senate seat as consolation. In New Jersey, Democrats were able to yank Bob Torricelli off the ballot after the deadline, knowing he would lose. In California, Arnold Schwarzenegger was elected governor because the voters wanted a do-over. In Texas, Republicans violate the longstanding tradition of redistricting only once a decade. And, of course, in 2000 Hillary Clinton won her vanity campaign in New York as a carpetbagger. And, while I think there's a lot of liberal myth-making about the Florida recount, there's no denying the event undermined many Americans' faith in the system.
Now, just as with the Keyes candidacy, each of these irregularities may be justified by no shortage of good arguments. But so what? That just demonstrates the political and cultural pressures driving efforts to rewrite the written and unwritten rules of our system.
The trends at work are complex and numerous. The cult of celebrity allows famous but unqualified candidates to drop into politics in ways that, say, scholars or economists cannot. Loopy campaign-finance rules encourage the super-rich to buy their offices, and weakened political parties are only too happy to serve as closing agents for the sale. Worse, consumer culture has infected civic culture. The push to make voting so convenient you can do it with a remote control exemplifies a growing tendency among voters to regard their "choices" as more important than their obligations. Indeed, for some reason, lots of people think it's imperative that criminals vote. Put your ear to the ground and you'll hear the bulldozer coming for the Electoral College.
Taken to its logical extreme, these trends would produce a nationalized political system in which voters in California, New York, and a few other states would have undue power to select presidents, senators, and congressmen.
Keyes understands all of this and admits that, as a matter of principle, carpetbagging is a bad idea because it violates the small-r republican principle that representatives should be products of the communities they represent. (Hillary Clinton, typically, derided such arguments as "dirty attacks" on her character.) In fact, Keyes wants to repeal the 17th Amendment, which empowers voters rather than state legislatures to elect senators.
Keyes also says in his defense that he was asked to run by the party in the state he hopes to represent -- unlike Hillary, who foisted herself upon New Yorkers. Fair enough. But doesn't such institutional desperation illustrate how much worse things have gotten in just four years?
Copyright (c) 2004 Tribune Media Services
http://www.nationalreview.com/goldberg/goldberg200408110822.asp


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Another Perspective
Deadly Hospitals Print Friendly Format
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By Ralph R. Reiland
Published 8/11/2004 12:05:16 AM
A 1999 study by the Institute of Medicine, "To Err Is Human," said that 98,000 Americans are killed per year by in-hospital medical errors. Now, according to a new study from Colorado-based Healthgrades Inc., a company that specializes in tracking patient outcomes and giving awards to hospitals that they assess as performing the best, the Institute of Medicine's estimate of preventable in-hospital deaths was wrong by half.
Researching data on nearly half of all hospital admissions from 2000 through 2002 in all 50 states and the District of Columbia, Healthgrades puts the number of annual deaths from medication errors and other in-hospital mistakes at 195,000. That's more than three Vietnams every year, more than triple the total number of Americans killed in Vietnam in over a decade of war.
The Healthgrades report, "Patient Safety in American Hospitals," includes the deaths of low-risk patients from infections as well as the mistakes made in attempts to rescue dying patients, things that were missing from the Institute of Medicine report. "If the Centers for Disease Control and Prevention's annual list of leading causes of death included medical errors," says Dr. Samantha Collier, vice president of medical affairs at Healthgrades, "it would show up as number six, ahead of deaths from diabetes, pneumonia, Alzheimer's disease and renal disease."
Worse, the 195,000 may be too low. "We're relying on data that hospitals submit," explains Collier, "and that might be a reason to under-document" the actual number of mistakes and resulting in-hospital deaths. "And we were only looking at in-hospital errors," says Collier, suggesting that medical errors made in outpatient settings would take the death toll to even higher levels. Imagine what we'd do as a nation if a U.S. passenger jet was crashing every day, or if a gang of jihadist shoe-bombers was successful in bringing down a fully-loaded U.S. passenger plane every day. The 195,000 figure, explains Collier, is "the equivalent of 390 jumbo jets full of people dying each year due to likely preventable, in-hospital medical errors, making this one of the leading killers in the U.S."
In total, the United States had 292,000 combat deaths in all of World War II. In America's hospitals, according to the Healthgrades report, we're losing that many people to medical errors every 18 months. In the face of this massive death toll, the Bush administration is seeking to put a $250,000 cap on recoveries for non-economic damages due to medical errors, place time restraints on a patient's right to sue, limit the level of punitive damages, and block lawsuits filed by patients seeking compensation from manufacturers for harm caused by medical devices or drugs.
On the point of preventing people from suing the manufacturers of defective medical products, the administration is arguing that patients lose the right to sue once a product has been approved by the Food and Drug Administration. " The FDA is not infallible," countered the New York Times in a recent editorial. " It seems poor policy to assume that once the agency has judged a product safe enough to use, the manufacturer should be insulated forever from lawsuits that could force improvements. Simple justice suggests that victims harmed by a product should be able to seek compensation."
Referring to "a culture of lawsuits in America, a litigation culture," President Bush stated in a speech earlier this year to a group of health care professionals in Little Rock that the American health care system "looks like a giant lottery," and "somehow, the trial lawyers always hold the winning ticket." In fact, what looks more like a lottery is taking a chance on a hospital and hoping to come out alive.
"Lawsuits don't heal patients -- that's a fact," said Mr. Bush in his Little Rock address. "We can have balance in our society when it comes to a good legal system and a good medical system. It's not that way today. The pendulum has swung way, way too far." Looking at the numbers, one has to wonder if the pendulum has swung far enough. Most studies show that only a very small percentage of negligently injured patients ever file a lawsuit. And with the equivalent of a World War II in America's hospitals every 18 months, one also has to ask why Mr. Bush is saying that the way to reduce bad performance is through a reduction in the penalties for bad performance.
Ralph R. Reiland is the B. Kenneth Simon professor of free enterprise at Robert Morris University and a columnist at the Pittsburgh Tribune-Review.

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http://www.foxnews.com/story/0,2933,128743,00.html
Senators Inquire on DHS Appointee
Wednesday, August 11, 2004
By Kelley Beaucar Vlahos
STORIES
*Homeland Security Appointee Under Investigation
WASHINGTON -- Two senators chairing committees with direct oversight of intelligence and terrorist-related issues have asked the chief internal watchdog at the Department of Homeland Security (search) to investigate the appointment of a top director at the agency and his brief suspension from it.
Faisal Gill (search), director of policy for intelligence at DHS, was forced to take a few days off in March after sources close to the FBI raised flags about Gill's former position as spokesman for the now-defunct American Muslim Council (search). He was then reinstated, and Republican Sens. Charles Grassley (search) of Iowa and Jon Kyl (search) of Arizona want to know why. They also are questioning why Gill is at DHS in the first place.
Grassley and Kyl sent a letter dated Monday to Clark Kent Ervin, DHS inspector general, requesting answers to a number of questions regarding Gill, who served in 2001 as the spokesman for the AMC, whose founder just pleaded guilty to federal indictments related to illegal foreign financing and immigration fraud, and admitted to a role in a Libyan assassination plot.
Click here to read the letter written by Sens. Grassley and Kyl (pdf).
Aside from questioning whether this connection raised concerns among officials before Gill was hired, the letter draws attention to reports that Gill had omitted his affiliation with the AMC when he filed his employment application and requisite security clearances at the agency.
"Questions have been raised about Mr. Gill's previous associations with groups and individuals who are known or suspected to be involved with terrorism financing," the letter reads.
"Mr. Gill is reportedly director of intelligence policy in the Department's Information Analysis and Infrastructure Protection (IAIP) directorate," the senators wrote. "A person in such a position would likely have access to highly sensitive information about vulnerabilities in the nation's critical infrastructure."
The senators then ask: "What is the department's policy for employees who omit information, especially information considered important or material, from their security clearance background forms?
"What are the Department's general policies and procedures for considering employment of a person with previous links or associations to individuals or groups who are investigated or prosecuted for suspected crimes, especially terrorism matters or, who provides services to such individuals or groups?"
Grassley, who is the chair of the Finance Committee, which is investigating terrorist funding streams, refused further comment on the letter Tuesday.
Kyl, who chairs the Terrorism, Technology and Homeland Security Subcommittee of the Senate Judiciary Committee, was also unavailable for comment.
Sources told FOXNews.com in July that Gill's defenders in and outside of the agency claim that he listed on his applications AG Consulting Group, a firm that farmed out Gill to work with AMC and other groups. Shortly afterward, Gill's name began appearing on the group's press releases.
Gill has repeatedly refused calls and e-mails for comment.
The senators point out in their letter that the principal lobbyist and operator of AG Consulting, Asim Ghafoor, has in the past worked with groups like the Global Relief Fund (search), whose assets were frozen by the U.S. government in December 2001 because of terrorist-related concerns.
Meanwhile, AMC's founder, Abdurahaman Alamoudi, pleaded guilty in a U.S. federal court in July to charges ranging from illegally receiving cash from Libyan sources to tax evasion and passport fraud. He also admitted to being part of a Libyan plot to kill Crown Prince Abdullah of Saudi Arabia.
Court documents call Alamoudi an active supporter of Hamas, which the U.S. State Department has deemed a terrorist organization.
Homeland Security officials have repeatedly refused to comment on Gill's employment or the controversy surrounding it. They did not return calls for comment on the senators' letter to the inspector general's office, which confirmed to FOXNews.com last month that Ervin is "looking further into the issue."
While a spokeswoman would not detail what kind of probe was being undertaken, the senators' letter asks the watchdog office not only to answer a series of questions about Gill, but also to report back with the "practices, policies and procedures for handling internal security matters with its employees."
Reports about Gill have invigorated a smoldering debate among Republicans, some who say the administration has been too accepting of certain representatives of Muslim groups with dubious ties to terror funding and anti-American sympathies. Others say going after Muslims like Gill is akin to a political witch hunt.
According to a former federal counterterrorism official who asked not to be named, Gill had a brief non-defense/intelligence-related background with the federal government after graduating from law school and joining the Naval Reserves in 1997.
Press releases available on the Internet also show Gill quoted as a vice chairman of the Prince William County Republican Committee in Northern Virginia, a post he apparently no longer holds, as well as treasurer of the Prince William Taxpayers' Alliance in 2003.
Gill, 32, also worked with the Islamic Free Market Institute, which was co-founded by prominent Republican activist and lobbyist Grover Norquist and Khaled Saffuri, who also worked as AMC's government affairs director.
A lot of these groups work together for a common cause, like promoting Muslim-American understanding, or civil liberties for immigrants, say defenders, who complain that they are disparaged because a few within their ranks have been corrupted. They say people like Gill are the victims of guilt by association.
"I don't think working for an organization like the AMC in of itself is a bad thing," said Kit Gage, president of the National Coalition to Protect Political Freedom (search), whose founder, Sami Al-Arian is awaiting trial on charges he was a prime fundraiser for the Palestinian Islamic Jihad, an accusation he vehemently denies. Gage said the group has distanced itself from Al-Arian.
"There are always going to be people who are racist, who are anti-Muslim and feel threatened by groups like ours who do coalition work, because we stand up for groups that have taken on unpopular positions," she added.
Nevertheless, Grassley and Kyl want to know what Department of Homeland Security officials knew about Gill's background before they hired him and whether they were working with experts within the government who had knowledge of the intricate web of Muslim charity groups and terrorist financers before they brought Gill on board. Also, they want to know what qualifications Gill has for the job.
"Moreover," their letter states, "it is crucial that DHS have full and accurate information about the background of its employees so that it can judge whether their work for the department does not present any threats to security."

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Egypt shaken by major theft of explosives from warehouses
SPECIAL TO WORLD TRIBUNE.COM
Monday, August 9, 2004
CAIRO √ A massive supply of explosives stolen from Egyptian warehouses last week could have found its way to either Al Qaida or Palestinian terrorists.
Egyptian security sources confirmed that a large amount of explosives was stolen from a warehouse of an oil company in the Western Desert near the Mediterranean coast. The sources said authorities have conducted an intensive investigation and detained hundreds of employees and guards of the company.
The Egyptian government has not announced the theft.
The sources said authorities were concerned that the explosives were stolen to fulfill an order by Islamic or Palestinian insurgents. They did not rule out that some of the explosives could be headed for the Gaza Strip.
Another scenario was that the explosives would be used for a major Al Qaida-inspired attack in either Egypt or another North African ally of the United States. Over the last year, Egypt has arrested hundreds of Islamic suspects connected to the Muslim Brotherhood or Al Qaida-inspired groups.
On Aug. 4, the opposition Egyptian Al Ahali daily quoted a security source as saying that 1,062 pieces of explosives went missing from an unidentified foreign oil exploration company in Marsa Matrouh northeast of Cairo. The newspaper said the explosives could be detonated by remote control, So far, 1,000 people, including guards and employees of the company as well as local residents, were arrested, Al Ahali reported.
Later, security sources confirmed some details of the Al Ahali report. But they said about half of the amount reported by Al Ahali was stolen. They also said the explosives were owned by Al Salam Petrol Services in Marsa Matrouh, about 500 kilometers northwest of Cairo.
About 100 pieces of explosives were found, the sources said. So far, none of the thieves were captured, they said.
Egypt has been cited as a leading source of weapons and explosives to the Palestinian insurgency in the Gaza Strip. Western diplomatic sources said a large amount of Cobra rocket-propelled grenade launchers was stolen from Egypt's state-owned defense industry and smuggled to the Gaza Strip.
Copyright ╘ 2004 East West Services, Inc.

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Saudi Reformists Stand Trial for Dissent
The Associated Press
Monday, August 9, 2004; 6:34 PM
RIYADH, Saudi Arabia - In a rare open court hearing, three advocates of democratic reform appeared before a judge Monday on charges arising from their criticism of the kingdom's political and religious life.
Saudi trials are normally held behind closed doors, but Monday's hearing was attended by about 200 people.
The defendants - Matrouk al-Faleh, Ali al-Dimeeni and Abdullah al-Hamed - are charged with sowing dissent, creating political instability, printing political leaflets and using the media to incite people against the government, according to two political activists who attended.
The activists, Abdul Rahman al-Lahem and Ibrahim al-Mugaiteeb, said the three asked the judge for two weeks to study the indictment. The judge granted the request.
The open trial is the latest of a series of moves toward limited reform in Saudi Arabia, the boldest of which is a pledge to hold municipal elections starting in November.
The pace of reform has been fitful, reflecting the government's need to conciliate conservative and progressive strands in society. Conservatives say reform will undermine the traditional power structure and strict Islamic orientation. Liberals view reform as vital to stem Islamic militancy and to meet the desire for greater freedom among young people.
The three defendants are the last remaining detainees of a group of 13 reformers arrested March 17 who had openly 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.
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.
On Monday, activist al-Mugaiteeb hailed the hearing as "a landmark."
"It is the first public trial of its kind, and it is positive in the sense that it validates the principle of freedom," said al-Mugaiteeb.
Al-Mugaiteeb, who leads a group called Human Rights First, said the state should release the defendants: "They are prisoners of conscience. They should be at home. They are not criminals or arms bearers."
The hearing was adjourned until Aug. 23.
? 2004 The Associated Press

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Riggs Investigation Prompts Inquiry Into 3 Oil Firms
By Kathleen Day
Washington Post Staff Writer
Thursday, August 5, 2004; Page E01
Federal regulators are probing at least three of the nation's largest oil companies -- Marathon Oil Corp., Amerada Hess Corp. and ChevronTexaco Corp. -- for possible violations of securities law prohibiting bribes to foreign government officials.
The Securities and Exchange Commission notified the companies of the probe by letter within the past two weeks, following the release of a Senate report that described transactions handled by Riggs Bank involving the oil companies and the dictator of Equatorial Guinea and his family, spokesmen for the companies confirmed yesterday.
A grand jury in the District is also investigating Riggs's handling of the Equatorial Guinea accounts.
The Senate inquiry, which included the report and a subsequent hearing, is part of a series of ongoing investigations by Congress, bank regulators and the Justice Department into Riggs Bank and its once-prestigious embassy banking division for long-standing violations of laws designed to prevent money laundering.
The report by the Senate permanent subcommittee on investigations concluded, "Oil companies operating in Equatorial Guinea may have contributed to corrupt practices in that country by making substantial payments to, or entering into business ventures with, individual Equatorial Guinea officials, their family members, or entities they control, with minimal public disclosure of their actions."
The report found that Riggs may have allowed Equatorial Guinea, its largest customer, and the country's dictator, Teodoro Obiang Nguema, to siphon millions of dollars in oil revenue into his personal accounts. Federal regulators also have said Riggs failed to report hundreds of suspicious transactions in more than 150 accounts held by officials of Saudi Arabia. The Senate report also found that the bank helped former Chilean dictator Augusto Pinochet hide millions of dollars from foreign prosecutors.
Marathon Oil, the nation's fourth-largest oil company, disclosed the probe in a filing with the SEC. Jay R. Wilson, a spokesman for Amerada Hess, the nation's fifth-largest oil company, confirmed that it, too, is a subject of the SEC inquiry. Marathon, Amerada Hess and Exxon Mobil Corp., the nation's largest oil company, are the largest oil companies operating in Equatorial Guinea, according to the report.
ChevronTexaco is the second-largest oil company in the United States but has a much smaller presence than the other three in Equatorial Guinea.
A spokesman for Exxon Mobil said it has not been contacted by the SEC in connection with Equatorial Guinea. Spokesmen for Marathon, Amerada Hess and ChevronTexaco said their companies are fully cooperating with the inquiry.
SEC investigators will seek to determine whether the companies broke anti-bribery laws and whether they committed securities fraud by failing to properly disclose disbursements made to a foreign government or official, according to lawyers familiar with the probe who spoke on condition that their names not be used because of the sensitivity of the investigation.
"Amerada Hess has received a letter from the SEC requesting our voluntary cooperation in an informal inquiry into payments made to the government, government officials and persons affiliated with government officials in Equatorial Guinea," spokesman Wilson said. "We will fully cooperate with the SEC."
Marathon, in its SEC filing, said, the SEC "notified Marathon that it was conducting an inquiry into payments made to the government of Equatorial Guinea, or to officials and persons affiliated with officials of the government of Equatorial Guinea. This inquiry follows an investigation and public hearing conducted by the United States Senate Permanent Subcommittee on Investigations, which reviewed the transactions of various foreign governments, including that of Equatorial Guinea, with Riggs Bank. The investigation and hearing also reviewed the operations of U.S. oil companies, including Marathon, in Equatorial Guinea."
Marathon spokesman Paul Weeditz said, "We have conducted our business with full compliance with the law."
The SEC probe is an informal investigation, which means the companies are being asked to voluntarily answer questions, submit records and provide other information. If the SEC staff finds evidence that it needs to investigate further, the next step would be for the agency's five commissioners to approve a formal investigation, which would allow SEC staff to issue subpoenas.
? 2004 The Washington Post Company
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Japan Nuke Plant Accident Kills 4 People
By MARI YAMAGUCHI
Associated Press Writer
MIHAMA, Japan (AP) -- Japan suffered its deadliest nuclear power plant accident Monday when a bursting steam pipe killed at least four workers and injured seven in another blow to the industry in an energy-poor country already worried about nuclear plant safety.
No radiation was released when the boiling water and steam exploded from a cooling pipe at the plant in Mihama, a small city about 200 miles west of Tokyo.
But the steam leak followed a string of safety lapses and cover-ups at reactors, and Prime Minister Junichiro Koizumi vowed to launch a thorough investigation into the accident. Fears about the safety of the country's 52 nuclear power plants soared in 1999, when a radiation leak northeast of Tokyo killed two workers and exposed hundreds to radiation.
Monday's leak was caused by a lack of cooling water in the reactor's turbine and perhaps by significant metal erosion in the condenser pipe, said the plant's operator, Kansai Electric Power. The pipe's wall, originally 10 mm thick, had become as thin as 1.5 mm in the 28 years since the reactor was constructed.
After the accident, Kansai Electric officials found a hole in the pipe that was believed to be the source of the leak. They did not say how big the hole was.
The water flowing through the pipe at the time of the accident was about 300 degrees Fahrenheit, said Akira Kokado, deputy plant manager.
Four workers died after suffering severe burns. Of the seven injured workers, two were in critical condition, three were in serious condition and the remaining two suffered minor injuries.
"The ones who died had stark white faces," said Yoshihiro Sugiura, the doctor who treated them at the Tsuruga City Hospital. "This shows they had rapidly been exposed to heat."
Investigators prepared to inspect the accident site Tuesday, and Japanese newspapers reported the government might be forced to shelve plans to build 11 new plants.
"In Japan, it's virtually impossible to build new nuclear facilities now," the national Asahi daily said in an editorial Tuesday. "But facilities are wearing out, and there are worries about increasing problems with corroding pipes, rupturing valves and the reactor core."
All the workers were employees of Kiuchi Keisoku Co., an Osaka-based subcontractor of Kansai Electric. They were all inside the turbine building to prepare for regular inspections of the plant, which began operating in 1976.
Government officials said there was no need to evacuate the area surrounding Mihama, a city of 11,500.
The plant's No. 3 nuclear reactor automatically shut down when steam began spewing from the leak. Its two other reactors were operating normally.
Yosaku Fuji, president of Kansai Electric, apologized for the accident as he bowed deeply before reporters at a televised news conference.
"We are deeply sorry to have caused so much concern," Fuji said. "There is nothing we can say to the four who lost their lives. We pray for their souls from the bottom of our hearts and offer our condolences to their families. We are truly sorry."
Kokado told a news conference that the metal erosion in the pipe was more extensive than Kansai Electric had expected. An ultrasound test might have detected the thinning but Kansai Electric never carried out such inspections, Kokado said, adding the company may have to review the way it conducts checkups.
Security guards closed the road leading to the seaside plant after the accident, which the city's residents said caught them off guard.
"I was so shocked. At first, I didn't think it was such a major accident," Naoki Matsubara, a 26-year-old office worker. "I'm so relieved there was no radiation leak."
Resource-poor Japan is dependent on nuclear fuel for nearly 35 percent of its energy supply, and a government blueprint calls for building 11 new plants and raising electricity output from nuclear facilities to nearly 40 percent of the national supply by 2010.
The deaths in Mihama also come as Japan is bidding to host the world's first large-scale nuclear fusion plant, the $12 billion International Thermonuclear Experimental Reactor, or ITER. But the project's sponsors - the European Union, the United States, Russia, Japan, South Korea and China - remain deadlocked over whether to build the plant in Japan or France.
The government vowed to quickly find out what happened on Monday.
"We must put all our effort into determining the cause of the accident and to ensuring safety," Koizumi said. He added that the government would respond "resolutely, after confirming the facts."
The United States had a similar accident at the Surry nuclear power plant in southern Virginia almost two decades ago when an 18-inch steel pipe burst and released 30,000 gallons of boiling water and steam, killing four people.
In Japan's 1999 accident, a radiation leak at a fuel-reprocessing plant in Tokaimura, northeast of Tokyo, killed two workers and caused the evacuation of thousands of residents. That accident was caused by two workers who tried to save time by mixing excessive amounts of uranium in buckets instead of using special mechanized tanks.
Several major power-generation companies have since been hit with alleged safety violations at their reactors, undermining public faith in nuclear energy and leaving Japan's nuclear program in limbo.
A 2002 investigation revealed that Tokyo Electric Power, the world's largest private utility, systematically lied about the appearance of cracks in its reactors during the 1980s and 1990s. The company later temporarily shut down all 17 of its reactors for inspections to reassure the public they were safe.
In February, eight workers were exposed to low-level radiation at another power plant when they were accidentally sprayed with contaminated water. The doses were not considered dangerous.
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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>> IRAN WATCH...

Iran Denies Providing Missile Test Site
The Associated Press
Saturday, August 7, 2004; 4:25 PM
TEHRAN, Iran - Iran on Saturday dismissed allegations it was providing test sites for North Korean long-range missiles designed to deliver nuclear warheads, the official Islamic Republic News Agency reported.
A Bush administration official claimed earlier that North Korea was getting around a self-imposed missile test ban by sharing technology information with Iran, which is allegedly carrying out missile tests on Pyongyang's behalf.
Iranian Defense Minister Ali Shamkhani rejected the claim, saying, "Iran does not cooperate with North Korea in missile technology and it does not need to."
President Bush has labeled Iran and North Korea as being part of an axis of evil, accusing both of pursuing nuclear weapons programs.
A leading military publication, Jane's Defense Weekly, reported recently that North Korea was developing two new ballistic missile systems that have "appreciably expanded the ballistic-missile threat."
Shamkhani said Iran is developing its Shahab-3 missile as a measure against Israel's missile power, which Tehran concluded tests of last year.
The missile is thought to be capable of carrying a 2,200-pound warhead over a distance of some 800 miles, which would put Israel within its range.
While Shamkhani denied any kind of nuclear military activity by Iran, he said his country would not leave its people without defense.
"That's why we have to invest on nuclear defense preparation," he added without elaborating.
Washington is working with South Korea, Japan, China and Russia to negotiate an agreement with North Korea to end its nuclear weapons program.
With Iran, the White House has been trying to haul Tehran before the United Nations Security Council based on accusations that the Persian state has been trying to build nuclear weapons against its Nuclear Non-Proliferation Treaty obligations.
Iran maintains its nuclear program is entirely peaceful, geared toward production of nuclear energy.
? 2004 The Associated Press

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Iran seeks to improve Shihab-3 missile as US officials say Bush diplomacy failing to slow down Tehran nuclear program
08-08-2004, 08:07
Iran aims to soon test an improved version of its Shihab-3 medium-range missile, Defence Minister Ali Shamkhani said, following Israel's boosting of its anti-missile missile capability.
"We will improve the Shihab-3 and when we test it, in the very short future, we will let you know," what improvements have been made, said the minister, who was quoted by ISNA student news agency.
"These improvements do not only concern its range, but other specifications as well," Shamkhani said, without providing further details.
Late last month, Israel successfully tested its Arrow II anti-missile missile in the United States. It was the seventh time the missile has worked, but the first time it destroyed a real Scud missile.
Shamkhani insisted the Shihab-3 was intended for defensive purposes.
"The Israelis are trying hard to improve the capacity of their missiles, and we are also trying to improve the Shihab-3 in a short time," Shamkani said, denying the Islamic republic was working on a more advanced Shihab-4.
When asked if the army was involved in Iran's nuclear program, Shamkhani said that its "only intervention in the nuclear area, is nuclear protection," referring to possible attack from Israel's suspected nuclear arsenal.
"If a military operation is carried out against us, we cannot do nothing, so we are investing in nuclear protection," he said.
Meanwhile, according to a report in the New York Times, US intelligence officials and outside nuclear experts have reached the conclusion that the Bush administration's diplomatic efforts with European and Asian allies have "barely slowed the nuclear weapons programs in Iran and North Korea over the past year", and that both have made "significant progress".
In a tacit acknowledgment that the diplomatic initiatives with European and Asian allies have failed to curtail the programs, high-ranking administration and intelligence officials said, according to the report, that they are seeking ways to step up unspecified covert actions intended, in the words of one official, "to disrupt or delay as long as we can" Tehran's efforts to develop a nuclear weapon. (Albawaba.com)
Israeli officials admit ''Arrow'' system should be upgraded in order to intercept Iranian missiles
03-08-2004
"There is a need to upgrade the capabilities of the Arrow missile so that it can intercept the Iranian Shihab missile; its interception ability is currently limited", according to representatives of the Arrow missile program that briefed the Israeli parliament's Foreign Affairs and Security Committee, on the experiment that took place last weekend in the United States.
Head of the Arrow project, Yair Ramati, thanked the committee during the Tuesday meeting for its success in convincing the U.S. congress to add $82 million to the mutual production of the Arrow by the Israeli Aircraft Industries and Boeing Company in the U.S.
In a test that took place last week, an Arrow missile successfully intercepted a Scud missile, which was launched from a vessel in an experimental field of the U.S. navy in California. In the course of the experiment, the Arrow was launched from an island in the Pacific ocean, located dozens of kilometers from California's shores.
The Arrow Interceptor is the first missile that was specifically designed and built to destroy ballistic missiles on a national level. It is aimed at becoming the first anti-ballistic missile system able to intercept its targets so high in the stratosphere. The Arrow ABM system was designed and constructed in Israel with financial support by the U.S. in a multi-billion dollar development program.
The system was designed and constructed after the massive failure of the anti-aircraft Patriot missile system to properly intercept and destroy the Scud missiles fired by Iraq during the first Gulf War in 1991.
Iran's Shihab-3 ground-to-ground rocket has an effective range beyond 1,300-kilometers, meaning it can reach Israel.
Iran has also plans for two longer-range missiles: a Shihab-4, with a 2,000-kilometer range and a Shihab-5, with a 5,500-kilometer range. (Albawaba.com)

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Bush Says Iran `Must' Abandon Nuclear Weapons Ambitions
By Alex Keto, Of DOW JONES NEWSWIRES
WASHINGTON -(Dow Jones)- Iran must abandon any plans it has to develop nuclear weapons, President George W. Bush said Monday.
However, Bush didn't outline any steps the U.S. might be willing to take to halt Iran's nuclear program other than to say the U.S. and its allies will continue to put pressure on Tehran.
The first step in halting any nuclear weapons program in Iran is to get the world to unite behind the idea that such a development would be unacceptable, Bush said.
"The first (step) is to make it clear to the world that Iran must abandon its nuclear ambition," Bush said.
"We've got to continue to keep pressure on the government (of Iran) and to help others keep pressure on the government so there is universal condemnation of illegal weapons activities," Bush said.
Bush made the comments in Annadale, Va., in response to a question from an audience of supporters.
Bush praised the actions of the U.K., Germany and France for helping deliver the message to Iran that the U.S. won't tolerate its nuclear weapons program. The three countries reached an agreement last year with Iran that opened up its nuclear program to greater outside scrutiny and included an agreement by Iran that it would halt development of its ability to enrich uranium.
Iran recently abandoned the agreement, saying it hasn't received help with its civilian program as promised.
Bush appeared to rule a military option to halt Iran's nuclear program, at least for the moment.
"Every situation requires a different response," Bush said in an apparent reference to the decision to topple former Iraqi president Saddam Hussein.
"We tailor our responses based on the reality of the moment," he added.
One response, Bush made clear, is to fan popular discontent among the Iranian people with the government in Tehran.
"The United States does have an opportunity to speak clearly to those who love freedom inside of Iran and we are," Bush said.
The president noted there is a "significant" number of Iranian-Americans "who long for their homeland to be liberated and free and we are working with them to send messages to their loved ones and relatives through different methodologies."
In addition, Bush noted that many radio broadcasts that originate in the U.S. are being received in Iran which say "free societies are possible."
Bush said he has few direct actions he can employ against Iran. Not only does the U.S. have no diplomatic relations with Tehran but "we have totally sanctioned them," Bush said.
"We are out of sanctions," Bush added.
On Sunday, National Security Adviser Condoleezza Rice offered much stronger comments on Tehran's nuclear ambitions.
"I think you cannot allow the Iranians to develop a nuclear weapon. The international community has got to find a way to come together and to make certain that that does not happen," Rice said on NBC's "Meet the Press."
She said the U.S. hasn't ruled out any options that it may use but also indicated that at the moment the U.S. is content to pursue a diplomatic approach. She predicted that in September the International Atomic Energy Agency will issue a strong statement that will leave Iran isolated.
-By Alex Keto, Dow Jones Newswires; 202-862-9256; Alex.Keto@dowjones.com
Dow Jones Newswires
08-09-041257ET
Copyright (C) 2004 Dow Jones & Company, Inc. All Rights Reserved
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Rice Cites International Concern Over Iran's Nuclear Intentions
By William C. Mann
Associated Press
Monday, August 9, 2004; Page A16
With Iran stepping up its nuclear program, a top White House aide said yesterday the world finally is "worried and suspicious" over the Iranians' intentions and is determined not to let Tehran produce a nuclear weapon.
National security adviser Condoleezza Rice also said the Bush administration sees a new international willingness to act against Iran's nuclear program. She credited the changed attitude to the Americans' insistence that Iran's effort put the world in peril.
She would not say whether the United States would act alone to end the program if the administration could not win international support.
Iran's foreign minister, Kamal Kharrazi, announced a week ago that his country had resumed building nuclear centrifuges. He said Iran was retaliating for the West's failure to force the U.N. nuclear watchdog agency to close its file on possible Iranian violations of nuclear nonproliferation rules.
Kharrazi said Iran was not resuming enrichment of uranium, which requires a centrifuge. But, he said, Iran had restarted manufacturing the device because Britain, Germany and France had not stopped the investigation by the International Atomic Energy Agency.
"The United States was the first to say that Iran was a threat in this way, to try and convince the international community that Iran was trying, under the cover of a civilian nuclear program, to actually bring about a nuclear weapons program," Rice said on CNN's "Late Edition."
"I think we've finally now got the world community to a place, and the International Atomic Energy Agency to a place, that it is worried and suspicious of the Iranian activities," she said. "Iran is facing for the first time real resistance to trying to take these steps."
President Bush, in his 2002 State of the Union address, included Iran with North Korea and Iraq in an "axis of evil" dedicated to developing nuclear and other weapons of mass destruction.
Since then, North Korea has publicly resumed its nuclear development program. In Iraq, invading U.S.-led forces have found no such programs since President Saddam Hussein was deposed.
Iran announced in June that it would resume its centrifuge program. Afterward, the U.S. official whose job is to slow the global atomic arms race, Under Secretary of State John R. Bolton, told Congress that Iran was jabbing "a thumb in the eye of the international community."
On NBC's "Meet the Press," Rice reasserted that the world has fallen in line on Iran and said she expects next month to get a strong statement from the IAEA "that Iran will either be isolated, or it will submit to the will of the international community."
She also said: "We cannot allow the Iranians to develop a nuclear weapon. The international community has got to find a way to come together and to make certain that that does not happen."
? 2004 The Washington Post Company
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Iran Seeks Support on Nuclear Technology
By GEORGE JAHN
Associated Press Writer
VIENNA, Austria (AP) -- Iran is demanding Europe's leading powers back its right to nuclear technology that could be used to make weapons, dismaying the Europeans and strengthening Washington's push for U.N. sanctions, a European Union official and diplomats said Monday.
Declining to respond to a list of demands presented by Iran last week - whose contents were made available to The Associated Press - the Europeans are urging the Iranian government to instead make good on a pledge to clear up suspicions about its nuclear ambitions.
But diplomats said Iran's demands undermine the effort by France, Germany and Britain to avoid a confrontation. They had hoped to persuade Tehran to give up technology that can produce nuclear arms, but now are closer to the Bush administration's view that Iran should be referred to the U.N. Security Council for violating the Nuclear Nonproliferation Treaty, the diplomats said.
The Iranian list, presented during talks in Paris, includes demands that the three European powers:
Support Iran's insistence its nuclear program have access to "advanced technology, including those with dual use," which is equipment and know-how that has both peaceful and weapons applications.
-"Remove impediments" - sales restrictions imposed by nuclear supplier nations - preventing Iran access to such technology.
-Give assurances they will stick by any commitment to Iran even if faced with "legal (or) political ... limitations," an apparent allusion to potential Security Council sanctions.
-Agree to sell Iran conventional weapons.
Audio
Bush says it's important that the Iranian government listen to global demands that it not go nuclear.
-Commit to push "rigorously and systematically" for a non-nuclear Middle East and to "provide security assurances" against a nuclear attack on Iran, both allusions to Israel, which is believed to have nuclear arms and which destroyed Iraq's nuclear reactor in a 1981 airstrike to prevent it from making atomic arms.
France, Germany and Britain last year had held out the prospect of supplying Iran with some "dual use" nuclear technology, but only in the distant future and only if all suspicions about the Iranian program were laid to rest.
With Iran still under investigation, the demands stunned senior French, German and British negotiators, said a European Union official familiar with the Paris meeting.
Ignoring the list, the Europeans instead urged Iran to act on its leaders' pledge to clear up suspicions about their nuclear ambitions by Sept. 13, when the International Atomic Energy Agency meets to review Iran's nuclear program, the official said.
The Paris talks ended "with the two sides talking past each other," said a diplomat familiar with the meeting, who - like the other diplomats and the EU official - agreed to discuss the matter only if granted anonymity.
In London, the Foreign Office declined to comment on the negotiations with Iran, but said Britain is "not prepared to stand by and watch them collect the necessary technology to make a weapon."
Iranian Foreign Minister Kamal Kharrazi insisted in Tehran that the international community has no reason to be suspicious about his country's nuclear plans.
"Iran has not violated any of its commitments to international treaties in its nuclear program," Kharrazi was quoted as saying by the official Islamic Republic News Agency.
The Bush administration insists Iran wants to make nuclear weapons, despite Tehran's claims that it is interested in uranium enrichment and other "dual use" technology only to help generate electricity.
During a campaign stop Monday, President Bush said U.S. officials are working with other nations to make sure the IAEA, the U.N. nuclear watchdog agency based in Vienna, asks Iranian officials "hard questions" about their weapons activities.
"Iran must comply with the demands of the free world and that's where we sit right now," Bush said in Annandale, Va. "My attitude is that we've got to keep pressure on the government, and help others keep pressure on the government - so there's going to be universal condemnation of illegal weapons activities."
Iran agreed last October to suspend uranium enrichment and cooperate with the IAEA investigation of its nuclear activities in exchange for a promise from the France, Germany and Britain to provide technology for peaceful nuclear programs once all open questions had been answered.
It subsequently stopped enrichment, but continued related activities. That fell short of a demand from the Europeans that it permanently renounce the process, which can both produce fuel for generating electricity and create the core of a nuclear warhead.
While enrichment remains suspended, Iran announced last week that it has resumed full-scale manufacture of centrifuges, which are used in uranium enrichment. It said the move was a reaction to the Europeans not persuading the IAEA to end its investigation.
Past American attempts to have the IAEA refer Iran to the Security Council foundered in part because of European resistance. But the hardline Iranian stance has emboldened U.S. officials.
A U.S. official in Washington, who spoke Monday on condition of anonymity, said the Paris meeting was a factor in the Bush administration's stronger confidence that it will get support for an IAEA board resolution asking for Security Council action against Iran.
On the Net:
International Atomic Energy Agency: www.iaea.org
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Pakistan slams US for 'mind-boggling' envoy sting (09/08/2004)
ISLAMABAD (AFP) Pakistan angrily accused its close ally the United States of endangering the life of one its top envoys in a reported sting operation, describing it as bizarre, dangerous and regrettable.
It was responding to claims that a US secret agent posed as a terrorist seeking to buy missiles to kill Munir Akram, Pakistan's ambassador to the United Nations, in a bid to catch potential money launderers.
"At one level this is a bizarre story; at another quite dangerous," government spokesman Masood Khan told a weekly press briefing about the New York Times report.
The projection of a fictitious threat to a senior envoy from a close ally of the US was "regrettable," Khan said. "It is mind-boggling why they could not use the name of an American functionary," he said.
Khan added: "This has increased our ambassador's and our mission's vulnerability. This technique and methodology is tantamount to autosuggestion and could have endangered the life of our ambassador."
The Pakistani government, one of Washington's most pivotal partners in the war on terrorism, has lodged a complaint with the US embassy in Islamabad.
"We hope that the US will realise its mistake and give instructions for rectifying this faulty methodology," Khan said.
Two men were captured in the operation and are being held by US authorities.
Pakistan's outburst came in the midst of a high-profile crackdown on suspected top Al-Qaeda operatives hiding out in the world's second most populous Muslim nation.
The July arrests of Tanzanian terror suspect in the 1998 east Africa US embassy bombings Ahmed Khalfan Ghailani and Pakistani computer whizz Naeem Noork Khan have led to the uncovering of a worldwide Al-Qaeda wing which was plotting fresh terror attacks in Britain and the US.

?AFP
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Elite veterans prowl Pakistan
By Rowan Scarborough
THE WASHINGTON TIMES
The United States, on the hunt for Osama bin Laden, is augmenting counterterror operations in Pakistan with scores of former special-operations warriors who work for the CIA and other agencies under contract.
Thousands of U.S. troops are openly fighting in Afghanistan along the Pakistan border. The stated U.S. policy, however, is that no American troops are inside Pakistan pursuing bin Laden's al Qaeda terrorists or advising local troops.
The reality is there are "a load of contracts" with U.S. agencies attracting veterans of Special Forces and other elite units to Pakistan, one source told The Washington Times.
The official ban is in deference to Pakistani President Pervez Musharraf, whose solid alliance with the United States in the war on terror stops short of allowing American ground troops in his country.
Asked at a March press conference whether U.S. troops were inside Pakistan hunting for Osama bin Laden, Defense Secretary Donald H. Rumsfeld responded, "The U.S. Department of Defense people? I doubt it. Not that I know of."
But Washington is getting around the ban by signing up former Delta Force commandos, SEALs and Green Berets and assigning them to special duties in Pakistan, according to two sources close to the special-operations community.
"There are a load of contracts going on for ex-SF [Special Forces] types there for every alphabet agency there is," one of the sources said.
The source said the former covert warriors joined CIA operations in Pakistan and train local soldiers in counterinsurgency techniques.
The de facto deployment of U.S. troops is an example of how far Pakistan -- an acknowledged nuclear power -- has come in its global alliances. Once a backer of the al Qaeda-supporting Taliban regime in Afghanistan, Islamabad has become one of Washington's most essential allies.
There was a time when such cooperation seemed impossible.
In the early days of President Bush's term, Dan Gallington, then a senior adviser to Mr. Rumsfeld, received a courtesy call from a former top Pakistani defense official who told him that the Taliban was sure to finally defeat the Northern Alliance and conquer all of Afghanistan. More alarmingly, this person predicted that his country also would fall to Islamic militants -- making it the first theocracy to own the world's most powerful weapon.
Three years later, Pakistan is the setting for the third hot war in the global war on terrorism, joining Afghanistan and Iraq as places where the military hunts and battles al Qaeda and other terrorists.
Bush administration officials say, in an odd twist, bin Laden's September 11 attacks might have saved Pakistan. Gen. Musharraf, who took power in a 1999 coup, saw his hold threatened by Islamic militants who were infiltrating more organs of government, especially the powerful intelligence service.
"Musharraf has clawed his way back, aggressively supported by the United States," said Mr. Gallington, an analyst at the Potomac Institute for Policy Studies. "We saved Musharraf in the nick of time. Pakistan is the focal point in that part of the world, and Musharraf understands that."
September 11 forced Gen. Musharraf to pick sides under pressure from Mr. Bush. He chose the United States.
During the invasion of Afghanistan in December 2001, the Pakistani president allowed his soil to be used by U.S. special-operations forces and the Predator spy drone to begin missions across the border.
During the subsequent counterinsurgency that continues today, he took an even bigger step. For the first time in memory, a president of Pakistan sent government troops into the vast tribal lands bordering Afghanistan. They are hunting for bin Laden and, in the process, confronting and killing bands of al Qaeda terrorists.
Pakistan's close working relationship with the CIA and FBI produced the arrests this summer of key al Qaeda members who use the country as a base from which to plan attacks and conduct worldwide communications. One key capture was Ahmed Khalfan Ghailani, who was indicted in the 1998 bombings of two U.S. embassies in East Africa.
On the ideological front, Gen. Musharraf's government has begun dismantling the network of harsh schools or madrassas that teach the young to hate. They are being replaced by public schools funded by the United States.
Pakistan served as sanctuary for bin Laden and his network for more than a decade. The teeming neighborhoods of cities such as Karachi and Islamabad serve as perfect hiding places.
Now, Gen. Musharraf is allowing CIA and FBI personnel to infiltrate those haunts, as his troops mount incursions into no man's land. It is all part of a risky attempt to methodically weed deadly militants from his country, while keeping the larger population in check.
Mr. Rumsfeld, in an Aug. 3 interview with Atlanta-based radio talk-show host Neil Boortz, described the alliance.
"We have thousands of troops in Afghanistan that are working along that Afghan-Pakistan border in close cooperation with the Pakistan government," the defense secretary said. "And the belief continues to be that Osama bin Laden and some of his senior operatives are possibly in Pakistan or in parts of Afghanistan from time to time."


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Top trainer at al Qaeda camp captured
By Paul Haven
ASSOCIATED PRESS
ISLAMABAD, Pakistan -- In a new blow to al Qaeda, authorities in the United Arab Emirates captured a senior operative in Osama bin Laden's terror network who trained thousands of militants for combat and turned him over to Pakistan, the information minister said yesterday.
Qari Saifullah Akhtar was secretly flown to the eastern city of Lahore, where he was being interrogated, a Pakistani intelligence official said on the condition of anonymity.
Pakistan, a key ally of the United States in its war on terror, has arrested about 20 al Qaeda suspects in less than a month -- including a top figure sought by the United States. The arrests prompted a series of raids in Britain and uncovered al Qaeda surveillance in the United States.
Akhtar once had run a vast terror camp in Rishkhor, Afghanistan, that was visited by bin Laden and Taliban chief Mullah Mohammed Omar. The camp -- a sprawling complex of shattered barracks and dusty fields about 10 miles south of the Afghan capital, Kabul -- trained 3,500 men in combat skills, including assassination and kidnapping.
Akhtar disappeared in the hours before the United States started bombing Afghanistan in October 2001 and had not been heard from since.
"Yes, we can confirm that we have Qari Saifullah," Pakistani Information Minister Sheik Rashid Ahmed said.
Akhtar was arrested in Dubai "in the past week" and turned over to Pakistan, the minister said, without giving any details about the arrest.
Officials in Dubai had no comment.
In Washington, the head of the White House's office of counterterrorism said Akhtar's arrest was significant and that he was thought to be involved in two December attempts to assassinate President Pervez Musharraf.
The arrest is "very important, particularly for Pakistan," Frances Townsend said on "Fox News Sunday."
Asked whether Akhtar is thought to be involved in current al Qaeda operations, Mrs. Townsend said, "Absolutely. Absolutely."
But Mr. Ahmed said it was "premature" to link Akhtar to the assassination attempts.
Akhtar is said to have been active in several Kashmiri militant groups, including the Harakat-ul-Jehad-e-Islami, whose Muslim fighters have fought as far afield as Chechnya and Bosnia.
"He had a hand in various cases," Mr. Ahmed said of Akhtar, without elaborating.
Pakistan's Geo television reported yesterday that authorities also had arrested Kashmiri militant Maulana Fazl-ur Rahman Khalil on charges of sending militants to Afghanistan to join the Taliban.
Khalil is said to be the leader of Harakat-ul-Mujahideen, a group linked to Harakat-ul-Jehad-e-Islami and one of several Kashmiri militant groups banned by Gen. Musharraf on suspicion of ties to al Qaeda.
Khalil also helped organize a clandestine 1998 trip by about a dozen Pakistani journalists to interview bin Laden in Khost, Afghanistan -- one of the last interviews he granted.
Senior government ministers had no comment on the Geo report, which did not say when or where Khalil was arrested.
Mr. Ahmed said the arrest of Akhtar was not linked to the recent capture of two other al Qaeda operatives, Ahmed Khalfan Ghailani and Mohammed Naeem Noor Khan.
Information gleaned during those arrests helped lead to a terror warning in the United States and a sweep in Britain that has netted about a dozen suspects.

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Lebanon suspends all investment plans in Iraq
Lebanon has suspended all investment plans in Iraq as a result of the latest wave of kidnappings, which included five Lebanese hostages. The nabbed Lebanese comprised of a businessman and four drivers whose trucks have also been hijacked along with a big load of power generators, An Nahar newspaper reported Sunday.
It quoted the chairman of Lebanon's Industrial Association, Fadi Abboud, as saying in an interview that Iraq's rickety security conditions "have led to halting any Lebanese planning to invest in Iraq."
"The Lebanese were eager a year ago to move into Iraq's industrial sector, because of the low cost of energy, which is almost non existent and the low costs of labor," Abboud conveyed.
According to him, the plan was to invest in the fields of plastics, power generating, air conditioners, petrochemicals and prefabricated houses. "But all this planning has now come to a standstill after the targeting of Lebanese in Iraq," Abboud said.
He stated Lebanon's exports to Iraq have ebbed between 30 and 35 percent as a result of the latest kidnappings. (menareport.com)

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Salem Chalabi Denies Murder Accusation
http://www.npr.org/rundowns/segment.php?wfId=3841739
?
from All Things Considered, Monday , August 09, 2004
Salem Chalabi, nephew of former U.S. adviser Ahmed Chalabi, denies allegations that he was involved in the June murder of the Iraqi finance ministry's director. An arrest warrant has been issued for Chalabi, who is currently overseeing the special tribunal for prosecuting Saddam Hussein. Hear Salem Chalabi and NPR's Melissa Block.


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>> ANOTHER

The UN Betrayal
Produced on 08/09/04
Listen to the story
800,000 Tutsis and moderate Hutus perished in Rwanda's genocide. It's been more than 10 years since the slaughter and there's much unfinished business. One case involves Callixte Mbarushimana. The charges against him are shocking, even in the context of the horrors that engulfed Rwanda. Mbarushimana worked for the United Nations there. He's accused of lending UN resources to the mass killing and even murdering co-workers. Michael Montgomery of American Radio Works produced our story in cooperation with the PBS program Frontline.
One final note on this story. Callixte Mbarushimana is suing the United Nations for back pay, reinstatement and damages. A UN advisory board has recommended that Mbarushimana receive back pay. But the matter is currently pending before the UN Administrative Tribunal.
During the Rwanda genocide ten years ago the UN's small contingent of foreign workers struggled to save lives. Men, women and children were being butchered by the thousands each day. Hutu extremists went to great lengths to track down and kill minority Tutsis working for international organizations like the United Nations.
Gregory Alex is a veteran aid worker in Africa. In April, 1994, Alex was working for the UN Development Fund or UNDP. He chose to stay in Rwanda during the genocide to lead emergency relief operations and try to protect his Rwandan colleagues. Alex says he was especially concerned for a UNDP employee named Florence Ngurumpatse. She was a Tutsi who was loved by many UNDP workers. Because of her ethnicity she was targeted by extremists.
Alex is a stocky man with a crew cut and an intense gaze. He steers his SUV through the center of Kigali. The streets are quiet as he passes freshly painted government buildings that served as the nerve center of the genocide ten years ago. He approaches a dirt lane and stops before a single story house surrounded by lush trees. Florence Ngurumpatse lived here. During the genocide it was just half a mile from a UN safe haven.
Gregory Alex: She was there with I think it was 10 children she was taking care of. I think there was a hope because of who she was that maybe she might be able to get out and save the children.
Ngurumpatse had taken in the children, mainly teenage schoolgirls, because she thought her UN status would give them protection. Surrounded by militiamen, she telephoned friends and UN officials, pleading for help in escaping. Alex says her voice grew increasingly desperate.
Gregory Alex: And she is saying they came again today, they threatened to kill us, they threatened to rape the girls. You know it was every day a terror. Kind of like the false execution torture where they say we are coming back later and we are going to kill you. So you spend the entire day terrorized that they are going to come and then they say `naw we are going to kill you tomorrow but we are going to rape you first before we kill you.'
Some UNDP workers were already dead. Tutsis in hiding or under UN protection told Alex they suspected a fellow UNDP worker, a Hutu, was behind the killings. His name is Callixte Mbarushimana. In 1994, Mbarushimana was 30-years old and working for the UNDP as a computer technician. During the genocide he assumed control of the UNDP compound after international staff was evacuated. Witnesses told Alex they saw Mbarushimana directing Hutu death squads.
Gregory Alex: The first thing they would tell me is don't give any information to Callixte. He's the one that is looking for us. And he had this, what I sensed from them, this desire to make sure he completed his task, which was to eliminate all Tutsis working for the UN.
Two weeks into the genocide Alex says he encountered Mbarushimana at the UNDP compound. He was armed.
Gregory Alex: And he came over with this angry look on his face and unprovoked he said "Nous eliminarans tous." And he had a paper in his hand and he slammed his fist into his other hand and he said no.....we will eliminate them all and he was referring to the Tutsis.
Three weeks later, in mid-May 1994, the UN finally authorized a rescue of UNDP employee Florence Ngirumpatse. But hours before UN armored vehicles were dispatched, Hutu militiamen invaded Ngirumpatse's house.... armed with knives and machetes.
Gregory Alex: I Imagine that all those people down at the checkpoints said, hey...and I'm sure there were people on the inside knowing what was happening, that the rescue operation was being mounted said `hey tomorrow's the day, you'd better do it today.' So they came in and they just cut them all to death. Women and children.
Alex suspected Callixte Mbarushimana tipped off militiamen to the impending rescue. But he didn't have the chance to find out. Like thousands of other Hutus, Mbarushimana fled Rwanda after the genocide. UNDP officials stationed in Africa say they were aware of allegations against Mbarushimana immediately after the genocide. But there is no record of any investigation by the UNDP into the killings of its staff or the possible use of its resources by the extremists. Not only did the UN fail to investigate Mbarushimana at the time ...he remained on the UN payroll seven years later. Charles Petrie is a senior UNDP official who served in Rwanda.
Charles Petrie: What infuriated me and others is that somebody like that could continue working for the UN. He was an international civil servant responsible for the murders of our colleagues.
In 2001, Callixte Mbarushimana was discovered still working for the UN...in Kosovo. Prompted by newspaper reports, the UN detained Mbarushimana and a complex legal battle followed. In the end, a Kosovo court rejected an extradition request from the Rwandan government. Mbarushimana was released and eventually moved to France. The story seemed to end there. But hidden from the public, the UN war crimes tribunal for Rwanda launched a secret investigation of Mbarushimana in May 2001.
Torny Grieg: The initial reaction was that, we are embarrassed at this story.
Torny Grieg is a lawyer from New Zealand who led the UN investigation. He is speaking publicly about the case for the first time.
Torny Grieg: It is a shocking story. Here is a man who was our colleague, who killed our colleagues, and we must not be seen to be sitting on our hands. We must get him.
Greig interviewed more than 20 witnesses in Rwanda and across Africa and Europe.
Torny Grieg: The picture we built up was that for some time prior to April 1994, Mbarushimana had formed a militia, and had done drill and weapons training in the months leading up to the genocide. They had attended party meetings which from the description seemed to resemble Nuremberg rallies that had been used to whip up feelings and hatred.
Witnesses told Greig that in addition to providing cash, vehicles and satellite phones--all UN property--to militias and the army, Mbarushimana was present at massacres of possibly hundreds of people, allegedly shooting some of the victims himself. Some witnesses were Tutsi survivors who told Greig they recognized Mbarushimana. Others were Hutus like this man who says he took part in the massacres alongside Mbarushimana.
Anonymous: There were two kind of people among us. Some of us joined the militia because we had to. Then there were people who really wanted to be there. People who had a desire to kill and would keep a list of the dead and the ones left to be killed.
This witness, who asked that his name not be used, is a 33-year-old carpenter who says he was given a club and ordered to help hunt down Tutsis. He remembers Callixte Mbarushimana as one of the top militia authorities in his neighborhood.
Anonymous: Callixte was a vicious and cruel man. He had lists and would direct the militias to homes. Most of the victims in this area were killed under Callixte's orders
American RadioWorks obtained a copy of a secret indictment drafted by a senior lawyer with the UN war crimes tribunal in the fall of 2001. It charges Mbarushimana with genocide and crimes against humanity. The document lists Florence Ngurumpatse, Callixte's former co-worker, as one of his targets. Mbarushimina would have been the first UN employee ever charged with war crimes by an international tribunal. But instead of signing the indictment, Chief Prosecutor Carla Del Ponte closed the investigation. In an order of dismissal, Del Ponte said there was insufficient evidence to support the charges. Prosecutor Del Ponte declined to discuss the case but Torny Grieg, who has since left the tribunal, says her decision ignored strong evidence against Mbarushimana.
Torny Grieg: I had eyewitness accounts, I had parties to his acts, I had their accounts. There was corroborative evidence from impeccable sources and there was evidence still lying in the ground literally waiting to be dug up, had anyone wanted to do so. The evidence was there. It stacked up and it compared with other cases that I had dealt with.
A senior official with the UN Tribunal who requested anonymity agrees that there was enough evidence to prosecute Mbarushimana but declined to elaborate on why the case was dropped.
Payam Akhavan: It is somewhat suspicious. Payam Akhavan is a former legal advisor to the UN war crimes tribunal. He left the tribunal prior to the Mbarushimana investigation and is now a senior fellow at Yale law school. Akhavan says that while the tribunal has sought to prosecute only the top leaders of the genocide, and not lesser figures like Mbarushimana.-- the UN had a special responsibility in this case because it involved a UN employee.
Payam Akhavan: What is strange in this case is that the prosecutor has gone out of her way to issue an order for dismissal which I find very unusual. Usually an investigation is simply dropped. There is no reason to have a specific order.
Speaking through his lawyers, Callixte Mbarushimana strongly denied playing any role in the genocide. Mbarushimana confirmed he was living with his family in Kigali during the genocide and coordinated work at the UNDP compound. But he says he too was attacked by gunmen during the genocide. Mbarushimana says the UN violated his rights during his detention in Kosovo. And in a further twist, he is now demanding back pay, reinstatement and an unspecified amount in damages before the UN administrative tribunal in New York. As for the allegations against him, Mbarushimana suggested they were part of a vendetta.
Charles Petrie: It's not a vendetta against Callixte. It's a moral responsibility towards those colleagues that we worked with who were killed.
Charles Petrie is now the UNDP's country representative in Burma.
Charles Petrie: The fact that somebody like Callixte and that affair can remain active ten years after 800,000 people were massacred is symptomatic of the fact that maybe the lessons haven't been learned and systems haven't been established to insure that something like that wouldn't happen again.
Petrie is now pressing the UNDP for a high level inquiry into the hiring of Mbarushimana, his activities during the genocide and the possible misuse of UNDP assets. He also wants to know why the UN war crimes tribunal dropped the indictment. Petrie says there is growing concern inside the UN that the organization might reach a financial settlement with Mbarushimana.
Charles Petrie: The UN is not a government. We have no armies. We basically are able to assert ourselves in difficult situations because of a moral authority. Were the UN to back down or not to pursue this to a new level then I think it would harm the moral authority.
UN officials in New York would not discuss Mbarushimana, citing the case pending before the UN administrative tribunal. But sources close to the case say the organization is resisting any large payment to Mbarushimana. Payam Akhavan says Secretary General Kofi Annan should order an inquiry.
Payam Akhavan: If there is an allegation of bribery or embezzlement or financial wrongdoing by a UN staff member, clearly the SG is under an obligation to order an inquiry. I would suggest that the case for an inquiry is thus much more compelling where the allegation is that a UN staff member was involved in the mass killing of thousands of innocent people.
Thousands, even tens of thousands of cases of murder remained unresolved in Rwanda. This is the poisoned legacy of genocide. 33 of the Rwandan victims worked for the UN Development Program. In Kigali, a column carved with their names stands in the courtyard of the UNDP compound.
Gregory Alex: You know you can come by here every day. You don't think of, you try not to think of what took place.
Gregory Alex, who left the UN and now works in Africa for the World Bank, still comes to this place to mourn his murdered colleagues.
Gregory Alex: You can see Florence. You can see my drivers. You look at the names here and you just think of, these are people that had skills and were people that represented a future for this country, and they're all gone.
This past spring the Rwandan government added Callixte Mbarushimana to its list of top genocide suspects living outside the country. Rwandan officials say they are discussing the case with authorities in France and will likely press for his extradition. But relations between Rwanda and France are poor. Meanwhile, a ruling from the United Nations Administrative Tribunal is expected in the coming weeks. For the World and American RadioWorks, I'm Michael Montgomery.
American RadioWorks is the documentary unit of American Public Media. Michael Montgomery and Stephen Smith produced this story in cooperation with the PBS program FRONTLINE.
For photographs and primary documents relating to the case visit: http://americanradioworks.publicradio.org/features/rwanda/segb1.html

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U.N. to Report on Iraqi Oil Corruption
By EDITH M. LEDERER
Associated Press Writer
UNITED NATIONS (AP) -- The panel investigating "serious" allegations of corruption in Iraq's oil-for-food program hopes to report on accusations of U.N. involvement by mid-2005, chairman Paul Volcker said Monday.
At a news conference releasing the committee's first quarterly report, the former Federal Reserve chairman said he doesn't know how long it will take to complete the investigation, which he estimated will cost at least $30 million over the next year.
The committee's report states that "the allegations of misconduct and maladministration are serious" and Volcker told reporters, "I think clearly there's a lot of smoke." He refused to speculate on what the investigation might find.
"If you really wanted to wrap this up, in the sense of chasing down every contractor involved here and what happened to the money, I think we'd be here until the next century," he said. "Obviously, we want to investigate enough of these cases to have an understanding, as best we can, of what happened."
The oil-for-food program, which began in December 1996 and ended in November, was launched by the U.N. Security Council to help Iraqis cope with U.N. sanctions.
Saddam Hussein's regime could sell unlimited quantities of oil provided the money went primarily to buy humanitarian goods and pay reparations to victims of the 1991 Gulf War. Saddam's government decided on the goods it wanted, who should provide them and who could buy Iraqi oil - but the Security Council committee overseeing sanctions monitored the contracts.
Volcker, the former chairman of the U.S. Federal Reserve, initially predicted that the Independent Inquiry Committee would produce some results on the U.N.'s internal operation of the humanitarian program in six to eight months. But he said there is a massive amount of documentation to examine just in the United Nations - "10,000 boxes ... with millions of pages" - plus critical material in Iraq and thousands of contracts.
Volcker said the committee's priority is "to make the definitive report" on the U.N.'s administration of the program and the accusations of corruption involving U.N. officials.
"We would certainly want to get that part of it done in the first half of next year - no later than the middle of next year," he said. "But that does not mean the investigation as a whole will be completed because there's so much going on outside the U.N. that we have to follow up on as well."
Volcker said there's "a lot of competition" in investigating allegations of payoffs, bribes, kickbacks, overcharges and undercharges by companies and individuals who bought Iraqi oil and sold Iraq goods.
The U.S. Congress has launched five investigations, the U.S. Justice Department is investigating, the U.S. attorney's office in New York is interested in potential corruption by American companies, Britain is investigating a company that reported some involvement, and Iraq's interim government has launched a major probe in hopes of getting some money back, Volcker said.
Allegations of corruption in the oil-for-food program surfaced in January in the Iraqi newspaper Al-Mada, which published a list of about 270 former government officials, activists, journalists and U.N. officials from more than 46 countries suspected of profiting from Iraqi oil sales that were part of the U.N. program.
Volcker's committee has taken custody of the U.N. files and he told reporters it will only give out information to other inquiries that it feels will not prejudice its own investigation or be prejudicial to particular individuals. He said the committee's 50-member staff was already "well advanced" in organizing the U.N. documents and has started conducting interviews.
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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China's PLA: 7-carrier exercise signals U.S. strategic shift 'from Atlantic to Pacific'
The global naval exercise known as Summer Pulse 2004 represents a new strategic U.S. military trend, the Chinese military publication PLA Daily stated last week. Seven aircraft carrier battle groups have put to sea simultaneously around the world, including two in the Pacific, as a show of multiple carrier operations. The report maintained that the focus of the exercise was for the U.S. to contain its Asian "potential opponent."

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U.S. replaces troops departing South Korea for Iraq with a 500-man Patriot missile unit
N. Korea letter to UN threatens war, calls U.S. force reorganization 'massive arms buildup'
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Election-year politics impact U.S. strategy for 6-nation talks on N. Korea
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Starving masses plus a cornered but well-fed leadership equals desperation for N. Korea
Saudi Arabia arrests senior ''militant''
A "militant of the deviating group" called Faris bin Ahmed bin Showeel Al-Zaharani and an individual accompanying him were arrested on Thursday evening while Saudi security men were hunting down members this group, an official source at the Ministry of Interior stated.
The source described to SPA on Friday Al-Zahrani as one of the leading terror suspects, who denounces people as infidels, calls for bombings, lambastes Ulema, and instigates other individuals to kill security men, noting that it will not disclose the identity of the second person for security reasons.
The source pointed out that the security men detained the two swiftly and efficiently so that they could not use the weapons they were carrying, indicating that no one was injured in this incident. (albawaba.com)

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Syria frees scores of political prisoners
Syria has freed 90 political prisoners this week, including three who have been in jail for more than 20 years, a Syrian human rights group said Wednesday.
The Human Rights Association in Syria said the government had released 35 political prisoners on Monday. A member of the association, lawyer Anwar al-Buni, told The Associated Press that another 55 political prisoners were released on Tuesday.
The Monday releases included Syria's longest serving prisoner, Imad Shiha, who was jailed in 1975 for belonging to the outlawed Arab Communist Organization, as well as two members of banned Islamic groups, Abdul-Qader Ahmed and Mohammad Hallak. Ahmed was imprisoned in 1979 and Hallak in 1982.
Shiha was imprisoned in connection with his alleged involvement in bombings. He was sentenced to life imprisonment with hard labour by the Supreme State Security Court (SSSC). During the initial stage of detention he was reportedly tortured and ill-treated, apparently to force him to confess to the charges brought against him.
Al-Buni said the prisoners were freed as part of last month's amnesty by President Bashar Assad to mark the fourth anniversary of his July 2000 accession to power.
Al-Buni said most of the prisoners freed this week were affiliated to Islamic groups and had already served their sentences. He added that four were seriously ill.
Some 160 prisoners jailed for common crime or military desertion have been freed during the past two weeks, al-Buni added. (albawaba.com)
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N.Korea Asylum Activist Released from China Jail
Reuters
Monday, August 9, 2004; 5:50 AM
BEIJING (Reuters) - A Japanese man accused of helping North Koreans flee abroad via China has been released from Chinese custody and allowed to leave the country, a Japanese embassy spokesman said on Monday.
Takayuki Noguchi, of the Tokyo-based rights group Life Funds for North Korean Refugees, was arrested last December in the southern region of Guangxi while trying to help two North Korean asylum seekers escape to Cambodia.
Noguchi was jailed for eight months and fined $2,400.
"He was freed today and they let him go home," the embassy spokesman said.
Life Funds for North Korean Refugees said the pair he tried to help, who had returned to North Korea from Japan in 1960 during a mass repatriation of North Korean nationals, had been sent back to the closed Stalinist state.
Activists say that as many as 300,000 North Korean refugees are hiding in northeast China after fleeing hunger, poverty and repression in their impoverished homeland. Defectors say North Korean refugees who are sent home may face imprisonment, torture or death.
Activists have orchestrated a series of mass defections at foreign diplomatic missions across China to try to pressure Beijing to reverse its policy of viewing North Koreans as economic migrants instead of refugees.
China, which fought alongside the North in the 1950-53 Korean War, has an agreement with its neighbor to repatriate illegal migrants. In recent years, however, it has allowed scores of North Korean asylum seekers who managed to enter foreign embassies and consulates to travel to South Korea via third countries.
? 2004 Reuters
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http://www.commentarymagazine.com/Archive/Pdf.aspx?v=118&i=1&p=32&o=1

In Search of "Righteous Arabs"
Robert Satloff
Robert Satloff is the director of policy and strategic planning at the Washington Institute for Near East Policy. His "What Do Arab Reformers Want?" appeared in our December 2003 issue. * A case in point is the Arab professor of English literature who contributed a brilliant essay to an Internet-based "virtual symposium" on Arab views of the Holocaust. See www.legacy-project.org/symposium/comments.html?Symposium_Paper=1&ShowID=1. hoped to conquer. That included a great Arab expanse in North Africa, extending from Casablanca to Tripoli and onward to Cairo--a region that was home to a half-million Jews. Indeed, the countryby- country plan of extermination laid out at the Wannsee Conference in Berlin in January 1942 makes sense only if the wildly inaccurate figure for the Jews of unoccupied France--700,000--is understood to include France's North African possessions: the colony of Algeria and the protectorates of Morocco and Tunisia.
In the brief period when they had a chance, the Germans and their allies made a significant start toward their murderous goal for North Africa's Jews. For three years--from the fall of France in June 1940 to the expulsion of German troops from Tunisia in May 1943--the Nazis, their Vichy French collaborators, and their Italian Fascist allies applied in these areas many of the same tools that would be used to devastating effect against the much larger Jewish populations of Europe. These included not only statutes depriving Jews of property, education, livelihood, residence, and free movement, but also forced labor, confiscations, deportations, and executions. Virtually no Jew in North Africa was left untouched. Nearly 10,000 suffered in labor camps, work gangs, and prisons, or under house arrest. By a stroke of fortune, relatively few perished, many of them in the almost daily Allied bombings of Tunis and Bizerte in the winter and spring of 1943 when the Germans forced Jewish workers to stay at their jobs clearing rubble. But if U.S. and British troops had not driven the Germans from the African continent in 1943, the 2,000-year-old Jewish communities of Morocco, Algeria, Tunisia, Libya, and perhaps Egypt would almost certainly have met the fate of their brethren in Europe. Many Arabs today would respond that all this has nothing to do with Arab history. It has to do, rather, with the history of colonialists who played out their designs on Arab soil; Arabs had no part in it, they would say. But they would be wrong. Just as in Europe, most members of the local populace stood by and did nothing; a few helped--the Arab world, too, had its "righteous Gentiles"; and some made matters demonstrably worse.
The story of the Holocaust in Arab lands has three main divisions: the extension of Vichy's "state anti-Semitism" to France's North African possessions; the imposition of Mussolini's anti-Jewish regime in Libya; and the six-month occupation of Tunisia by German and Italian troops. OtherFrench possessions in the Levant--Syria and Lebanon-- were affected by Vichy, but to a much lesser degree and for a considerably briefer time. There was also the special case of Iraq, which in 1941 witnessed a rapacious campaign against Jews in the course of a short-lived military coup by Rashid Ali al-Gaylani, a Nazi sympathizer; but neither the Germans nor their other European partners were central actors in that drama.
Particularly hard hit was Tunisia, the only Arab country to come under direct German occupation. In just six months, from November 1942 to May 1943, the Germans and their local collaboratorsimplemented a forced-labor regime, confiscations of property, hostage-taking, mass extortion, deportations, and executions. They required thousands of Jews in the countryside to wear the Star of David, and they created special Judenrat-like committees of Jewish leaders to implement Nazi policies under threat of imprisonment or death. Tunisia was also the training ground for some of the most notorious Nazi killers--like SS ColonelWalter Rauff, who had earlier invented the mobile death-gas van.
Nevertheless, of the three European countries that brought the Holocaust to Arab lands, the most malevolent by far was France. In Morocco and, especially, Algeria, France implemented strict laws against local Jews, expelling them from schools, universities, and government employment, confiscating their property, and sending a number of local Jewish political activists to harsh labor camps. In some respects, Vichy was more vigorous about applying anti-Jewish statutes in Arab lands than in metropolitan France.
Not content with this, Vichy also dispatched more than 2,000 European Jews to forced-labor camps in North Africa. The origins of this tale lie earlier, in the 1930's, when France's relatively liberal Third Republic provided safe haven to thousands of Central European Jews fleeing their homelands while they still could. Many of these new arrivals promptly joined the French army. Indeed, when war arrived in 1939, a Jewish veterans' organization operating out of a single office in Paris reportedly registered 10,000 volunteers, all noncitizens, in a mere ten days. But none of this made any difference. The collaborationist government established in 1940 under Marshal P?tain turned the Jews, both foreign and native-born, into ready scapegoats for France's shameful collapse at Nazi hands. As recent scholarship has definitively shown, the persecution of Jews under Vichy originated as a French, not a
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German, affair; eventually, thousands of French Jewish citizens would be herded into cattle cars, sent to notorious transit stations like Drancy, and then on to death camps in "the east." It was, however, the foreign Jews living in France who first felt the brunt of the French defeat. For Vichy, the thorniest problem was presented by those who had volunteered for military duty and had been led to believe that their service to France would be repaid with legal residency and perhaps citizenship. Even hardened anti-Semites blanched at the idea of discharging Jewish soldiersone day and consigning them to death the next.The deserts of France's Arab possessions offered a ready solution. One of the first acts of P?tain's government was to revive the old imperial idea of a trans-Sahara railway: a thousand miles of track across the sands that would drastically cut the travel time from Niger to Nice and bring the riches of Africa to the metropolis. To level the dunes, clear the rocks, lay the tracks, and mine the considerable deposits of coal and ore near the route, Vichy summarily dispatched more than 7,000 unwanteds to desolate corners of western Algeria and eastern Morocco. Most were political prisoners of various stripes-- Spanish republicans, Communists, socialists, anti- Nazi Germans, Gaullists; also included were a smattering of Arabs and even a Japanese. More than 2,000 were Jews, who, unlike the rest, were deported not for their politics but for their religion. The places where these unfortunates arrived were concentration camps, conceived by Frenchmen and filled with individuals whose only "crime" had been to flee fascist tyranny for the safety of a once-welcoming France. Soldiers and legionnaires, technically demobilized from their military service, were immediately compelled to sign contracts reclassifying themselves as "wartime labor conscripts," which meant they were subject to military discipline. Though the contracts stipulated the payment of a wage--typically, a few francs a day from the payroll of the Mediterranean-Niger Railway Company--few ever received any money. They were, in fact, prisoners in all but name. Shipped southward by cattle car from the ports of Algiers and Oran, they were herded into camps from which there was no leaving; some died in the attempt. Given little food, water, or rest, they worked from dawn to dusk gathering, breaking, loading, and moving rocks. Medical care was virtually nonexistent. Having built stone casernes to house their French overseers, the prisoners themselves were consigned to tents; smuggled photographs show 40 individuals packed inside tents designed for eight. Their clothes and blankets were threadbare; often, they had no shoes. Torture was common and frequent. According to later testimonies, the camp commandants and senior officers, mostly legionnaires themselves, were vicious anti-Semites, sadistic and often drunk, many of German origin or fascist sympathies. They were assisted by Arab and Senegalese guards, notorious for their cruelty. Any Arab or Berber watchman discovered showing sympathy for the Jews, secretly providing them with extra water, blankets, or rations, was quickly assigned to other duties and replaced by local guards whose ruthlessness was more reliable.
A 1943 British Foreign Office document, "Barbaric Treatment of Jews and Aliens in Morocco," records the testimony of Polish Jewish prisoners who made their way to London after being freedby the Allies. Here is one such testimony, describing a common method of torture: The tombeau--tomb--is a grave dug in the ground, two meters long, 40 centimeters deep and 60 centimeters wide. Men under punishment are confined to this tomb for various periods. . . . The minimum sentence is eight days and nights. The maximum survived was seventeen days and nights. In this case the victimwas a Polish Jew called Rosenberg.Typical of the offenses which earned a man a stretch of tombeau was that of the German Jew Selgo. . . . Like all the others, he had to lie face up night and day. He had no covering,only a tattered Legion uniform with no underclothes. He was not allowed to move or change positions in the tombeau. An Arab was posted over the graves to see that the victims stayed rigidly still. . . .
The only occasion when a man was allowed to raise his head a little was after a rainstorm when the graves filled with water. Then he was allowed a stone for a headrest to save him from drowning. As the subsoil was clay, the waterwould take three days to drain away. . . . [Foreign Legionnaire] Gayer or one of the other guards would bring the men their meals--one liter of water at 0800 hours, 250 grams of bread and a glass of water at 1200 hours, and another glass of water at nightfall. A man was allowed to relieve himself only during these three visits of the guard. If he could not do it then he had to do it in his clothes and lie in it. . . . As the majority of prisoners were suffering from severe and sanguinary dysen- tery, a man lying in his own filth was the rule rather than the exception.
Not many men were able to survive the longer sentences in the tombeaux. They succumbed to the appalling variation in temperature in every twenty-four hours. By day, an egg could be cooked hard in the sand within five minutes. By night the temperatures fell to near freezing point and in winter below it. Another survivor, a German Jew named Harry Alexander whose story has been recorded for the U.S. Holocaust Memorial Museum, had managed to escape from Germany to France, where he planned to join the French army. Instead, he found himself on a freight train to Djelfa, a Vichy labor camp in the Algerian desert. "There were many ways to die" at Djelfa, he explained: "You had dysentery. You had malaria. A lack of food. A lack of water. Bitten by scorpions. Bitten by vipers . . . and you're dead in an hour." As for torture, a common form at Djelfa was "the fort," wherein French soldiers and Arab camp guards would tie your arms in the back and hang you on your arms naked for about two, three days. You would hang on your arms and every night they would come in and, when it's the coldest, hose you down with ice water and beat you about. . . . And when you got through hanging there, when they cut you down, you were not able to walk. In fact, you were lucky to be alive. Thus far I have touched but lightly on the role of Arabs themselves in the events I have been recounting. There has been, indeed, scant writing about and little documentation of this side of things. But for the past two years, while living in Rabat, the capital of Morocco, I have tracked down stories of Arabs who played a role in the Holocaust, be they villains or heroes. With the help of researchers and investigators in ten different countries, I have been able to unearth the stories of dozens of such individuals.
Their number includes outright collaborators-- i.e., Arabs who personally participated in the persecution of Jews. Among these were an Arab sadist who commanded a Jewish work brigade in the Tunisian countryside; another Tunisian, Hassen Ferjani, convicted by a French military tribunal of having informed to the Germans on three Jews fleeingacross Allied lines, an act leading to their deportation and eventual beheading; Arab patrolmen who tracked down Jewish escapees from forced-labor camps; Arabs who walked alongside German soldiers, pointing out Jewish homes and property for confiscation; the Arab accomplice to a German soldier who raped a Jewish woman in La Marsa, outside Tunis; and Arab camp guards who urinated on the heads of Jewish forced laborers as they lay buried to their necks in the sands of Algeria. In addition to these individuals were the hundreds of Arabs who volunteered to join Axis and pro-Axis forces like the Phalange Africaine, the Brigade Nord Africaine, and the German-Arab Training Battalion. And then there were the nameless thousands throughout North Africa who extorted money and property from Jews at their moment of abject weakness.
As for the heroes who helped save Jews from pain, injury, indignity, and perhaps death, they included:
* the Bey of Tunis and, more famously though less conclusively, the Sultan of Morocco, both of whom bucked their Vichy and German overlords to provide vital moral support to their Jewish subjects, as well as practical help to a number of Jewish personalities and their families;
* the Arab country squire who opened his farm to 60 Jews escaping from an Axis forced-labor camp in Tunisia's Zaghouan valley;
* a middle-aged Arab notable in the Tunisian seaside town of Mahdia who, upon learning that a German officer was bent on raping a local Jewish woman, a mother of three, whisked away the entire family in the middle of the night and kept them hidden on his farm for several weeks until the Germans quit the town;*
* the Arab politician who secretly warned and offered shelter to his longtime Jewish friends when Nazi SS troops were planning raids against the Jewish leadership in Tunis;
* religious leaders in Algiers who forbade any Muslim from serving as a Vichy-appointed conservator of Jewish property;
* Arab inmates of a prison camp in the Algerian desert who forged an anti-fascist bond with their Jewish prison mates;
* Arab soldiers whose response to shoot-to-kill orders was to fire wide, purposely missinghelpless Jewish laborers;
* and, in faraway Paris, the rector of the municipal mosque, Si Kaddour Bengabrit, who is said to have given Jewish children counterfeit certificates of good standing as Muslims, thereby enabling them to escape deportation. * In October 2003, this woman's daughter, Anny Boukris, told her family's story in detail for the first time to an interviewer I arranged to visit her in Palm Desert, California; she died eight weeks later. I was able to confirm key details of the story in a May 2004 visit to Mahdia.
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Similarly not to be forgotten are those Arabs who suffered alongside Jews--as prisoners in Vichy concentration camps or, as was the case in Tunisia, as forced-laborers drafted once the Jewish community had exhausted its own manpower. A small number of Arabs and Berbers also participated in one of the war's most daring and overlooked exploits: the takeover of key sites in Algiers by the predominantly Jewish underground, an action that eased the amphibious entry of thousands of U.S. and British troops on the night of Operation Torch in November 1942.
Taken together, this history is rarely told, and the heroes, in particular, have never been recognized. Of the more than 19,000 "righteous Gentiles" honored by Israel's Yad Vashem for rescuing Jews from death during the Holocaust, not a single one is an Arab (though there are a number of Muslims, including Turks, Bosnians, and Albanians). In my view, the reason for this lacuna is dual: few have ever looked for "Arab righteous," and fewer still have had an incentive to be found. For Arabs, the legacy of World War II was soon overshadowed by two other developments: the conflict with Zionism over the fate of Palestine and the struggle for independence against European colonialism. By the late 1940's--and certainly by the time of the Suez crisis in 1956--the blurring of the state of Israel with "the Jews" was already a deeply embedded theme of Middle Eastern politics. For an Arab, there was little to be gained (and much to be lost) by being identified with the defense of Jews or of Jewish interests. Sultan Muhammad V of Morocco and, to a lesser extent, Habib Bourghiba, the secular leader of Tunisia's independence movement, were significant exceptions, noteworthy not least for their rarity. For Jews, the situation was more complex. To many of those remaining in North Africa, memories of their horrible wartime experience were swiftly overtaken by the less systematic but often more violent anti-Zionism that compelled hundreds of thousands to quit their homes for Israel in the late 1940's and 1950's. Once in Israel, wartime memories were further obscured by the tension in that country between Ashkenazi and Sephardi Jews. To the degree that the former jealously guarded their Holocaust legacy--theirs, after all, had been by far the greater calamity--the latter tended not to focus on theirs. Similarly neglectful were Holocaust historians and institutions; even today, one hears debate in Israel over whether it is even appropriate to use the term "survivors" for Jews from Arab countries who suffered Nazi-era racial laws and punitive actions.
An additional wrinkle concerns the odd position held by the small and still dwindling remnants of once-grand Jewish communities in Arab countries. Less than 2 percent of the wartime Jewish population is left in Morocco and Tunisia today; in Algeria and Libya, the communities are effectively extinct. Navigating between the Scylla of Islamic radicalism and the Charybdis of regime indifference to their fate, Jews in these countries have by and large opted for quiescence. This attitude even extends backward to their past history. Although in the course of my research I did come across Sephardi activists agitating for wider acknowledgement of the history of the Holocaust in Arab lands, none actually resides in an Arab land today. But if these considerations help to explain the obscuring of the Arab encounter with the Holocaust, they hardly excuse it. When I began my research into this hidden history, my secret desire was to organize a commemorative event in May 2003 on the sixtieth anniversary of the Allied liberation of Tunisia. For the obvious reasons, I wanted it to take place in Auschwitz--as it happens, a handful of Tunisian deportees were eventually killed there--and I envisioned a ceremony that would bring together Tunisian government officials, scholars, journalists, local Jewish community leaders, and members of Tunisia's expatriate Jewish community.
My idea died when, traveling to Tunis, I asked my first interviewee, a prominent Arab historian, about the day his country was "liberated" from Nazi occupation. With a quizzical look on his face, he replied: "Liberation? What are you talking about? The departure of the Germans meant thereturn of the French, who were infinitely worse!" And this rebuff was nothing compared with my reception by the children of one of my prime candidates for recognition as a "righteous Arab": Tunisia's wartime prime minister, Muhammad Chenik. Walking a dangerous line between the Germans and his longtime personal friendships with Jews, this Arab notable, according to various interviewees, had used his connections to warn Jewish leaders of impending arrests and had secured dispensations from forced labor for the sons of Jews he knew from his business days. He very likely saved Jewish lives, perhaps at risk to his own. Whatever the motive behind these deeds--personal friendship, old business obligations, simple kindness--they were truly noble. Since I was intending to resurrect the story of this long-forgot- ten statesman, and bring honor to his name, I had expected his family to embrace the revelations I was offering them, or at the very least to thank me for my efforts. And indeed, the family members who gathered in their comfortable seaside villa to hear my tale were polite, generous, and welcoming, plying me with tray after tray of delicious sweets and several rounds of coffee and tea. But through the smiles and handshakes, it rapidly became clear that they wanted nothing to do with my story of their father's exploits. We have never heard about any of this, they insisted, and even if what you say is true, it does not amount to anything significant. Although they urged me to return with irrefutable proof, they offered no help, and it was obvious they hoped never to hear from me again. Perhaps the hardest blow has been the silence that has greeted most of my entreaties to moderate, forward-thinking Arabs to assist in shedding light on this chapter of their history. For every positive response to a phone call or a posting on an Internet message board, there have been a dozen cold shoulders, unanswered faxes, or unfilled promises.
In October 2003, to take one example, I contacted the prominent Egyptian thinker Ahmed Kamal Abulmagd--widely considered one of the most moderate and open-minded of Muslim theologians, and certainly no Holocaust denier--after his appearance before an audience at the American University of Cairo, where he had participated in an exchange with the American ambassador. At one point in their discussion, Abulmagd had turned to the ambassador and said:
We all condemn the policies of Hitler and the Holocaust, but enough is enough. There is a moment of saturation and, let me be very blunt on this, world Jewry is in danger because of the very irresponsible policies of the government of Israel, supported by some unaware leaders of the Jewish community in the United States. I hate to see a day where there is an unleashing of dormant general anti-Semitism, in Europe, particularly, and maybe in the United States. But we Arabs are not part of it. We are not part of the Holocaust. We never persecuted Jews. In contacting Abulmagd, my purpose was not to persuade him to repudiate his remarks. On the contrary, I wanted to ask him to use his good offices in helping me gain access to Egyptian consular records from the late 1930's. Those files, I believe, may contain evidence of an "Arab Wallenberg," an Egyptian diplomat who I suspect provided marriage or birth certificates to German and Austrian Jews, enabling them to flee to Cairo and from there to freedom in London. Though one might think Egyptian officialdom would be eager to exploit proof of a great humanitarian act by an Egyptian diplomat, one that would burnish Egypt's bruised image in the United States, none of my requests to Cairo policymakers--some of whom, at the highest levels of government, I have known for more than fifteen years--has ever been acknowledged. That is why I wrote to Abulmagd--twice. Noting the absence of a single Arab among Yad Vashem's list of "righteous" non-Jews, I begged for his intercession: "Didn't some Arabs help or rescue some Jews?," I asked. "And if indeed some Arabs didrescue some Jews, then isn't this the positive, constructive answer to Arab Holocaust denial?" But the taboo against recognizing any Arab connection to the Holocaust, even in order to celebrate the deeds of a heroic Arab rescuer, is evidently too strong. I am still waiting for an answer.
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How would you fix Social Security, Sen. Kerry?
He could legitimately be accused of implicitly endorsing tax increases
By MICHAEL TANNER
Copyright 2004 Houston Chronicle News Service
When it comes to Social Security reform, John Kerry is clear about what he is against.
``I will not privatize Social Security,'' he declared in his acceptance speech to the Democratic National Convention. ``I will not cut benefits.'' The Democratic Party as a whole takes the same position through its party platform: ``Democrats believe in the progressive, guaranteed benefit that has ensured that seniors and people with disabilities receive a benefit not subject to the whims of the market or the economy. We oppose privatizing Social Security or raising the retirement age.''
It is a clear, resounding message... that says absolutely nothing about what Sen. Kerry or the Democrats would do to solve Social Security's looming financial crisis.
Yet Social Security will start running a deficit - spending more money on benefits than it takes in through taxes - in less than 15 years, by 2018, according to the last report of Social Security's trustees. The so-called Social Security Trust Fund, which is supposed to help pay benefits until 2042, in reality contains only government bonds, essentially an IOU. While few people doubt that those benefits will ultimately be paid, the federal government will still have to find the money to pay them.
And a lot of money it is.
In 2018, the first year that Social Security faces a shortfall, the cash deficit will exceed $17 billion. That's almost as much as Kerry has proposed in increased spending on Pell Grants.
By 2022, the annual Social Security deficit will have grown to roughly $100 billion, as much as Kerry would spend for a proposed energy trust, increased veterans benefits, fully funding Head Start and increased spending on homeland security.
By 2027, with the annual deficit approaching $200 billion, you can add inhis proposed increases in aid to state and local governments, his national service plan, and science and technology research.
And so it goes.
Overall, Social Security now faces unfounded liabilities in excess of $26 trillion.
One has to wonder where Kerry plans to get the money.
Actually, it is all too clear where the money will come from. As former President Bill Clinton pointed out, there are really only three options for Social Security reform: raise taxes, cut benefits or invest privately.
Since Sen. Kerry rules out private investment or benefit cuts, he could legitimately be accused of implicitly endorsing tax increases. And mighty big tax increases they would have to be: a 50 percent increase in the payroll tax or the equivalent.
This would be a tax hike far higher than what Kerry would ``save'' by rolling back parts of President Bush's tax cuts - even if he hadn't already promised to use those savings to fund other government spending. Not that financing is the only problem with Social Security. The program already provides today's workers with a low, below-market return on their tax ``contributions'' to the program. The program unfairly penalizes blacks, working women and others. Workers don't own their money or have any guaranteed right to their benefits.
In short, it is a program crying out for reform.
But Sen. Kerry continues to duck the issue.
Frankly, that's not good enough. No one should be running for president if he can't stand up and tell the American people what he would honestly try to do about Social Security.
President Bush has made his position clear. He would allow younger workers to privately invest at least a portion of their Social Security taxes through individual accounts.
You can agree or disagree with that idea, but at least you know where he stands.
If Sen. Kerry plans to raise taxes to prop up Social Security, he should tell us. If he has another idea, he should share it with us. If he believes that the current program, with all its problems, is the best we can do, he should say so. Sen. Kerry says that he has ``reported for duty.'' But on one of the most important domestic issues facing this country, he has been AWOL.
Tanner is director of the Project on Social Security Choice at the Cato Institute. Readers may write to the author at the Cato Institute, 1000 Massachusetts Avenue NW, Washington, D.C. 20001; Web site: www.cato.org.
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Fiscal Follies
Clinton balanced the budget by cutting the military. That's not an option now.
Monday, August 9, 2004 12:01 a.m. EDT
In a startling reversal of the usual party roles, John Kerry is staking his White House claim as a defender of "fiscal discipline" to counteract a spendthrift Republican Administration. It's all the more startling because his publicly announced proposals would actually increase the deficit.
Now, there is a certain satisfaction here for those of us who advised President Bush to veto a spending bill or two. His decision to acquiesce to Congress's worst spending impulses, from farm subsidies to Medicare, has given the Democratic challenger a chance to score political points simply by announcing his good intentions. It's true Mr. Bush never campaigned for a smaller government, but after 9/11 he certainly could have argued that the government had to choose between guns and butter. Until this year, he's gone along with both.
But none of this means the Kerry campaign deserves a free pass. According to last month's estimate from the National Taxpayers Union, Senator Kerry is promising to increase net spending by $226 billion in the first year, or $6,066 per taxpayer over four years. And that's a lowball figure. The calculation used the lowest cost estimate of each spending proposal. And it took at face value proposed spending cuts, such as ending subsidies to corporate farmers and reducing federal energy usage by 20%, which may be impossible to implement. Cuts in corporate welfare and the federal travel budget sound good, but they are campaign perennials that never seem to happen.
Even overlooking these flaws, how can Mr. Kerry blow out the budget so badly? It's not hard if you promise to be all things to all people. On top of Mr. Bush's huge education spending increases, the Democrats want to add $75 billion more in the first year alone. Another $56 billion is earmarked for public works and social programs. The Kerry health care proposals will cost another $71 billion that year, or $653 billion over 10, according to a former Clinton Administration economist. His original estimate was nearly $1 trillion until he found some miraculous savings.
Meanwhile, as part of his new image of toughness, Mr. Kerry promises to continue beefing up the military and homeland security, to the tune of $24 billion. Most of that will go for personnel benefits, but it will also pay for 40,000 more active-duty troops and to promote port safety, both respectable proposals.
The Democrats are trying to spark nostalgia for the Clinton era of supposed fiscal discipline. But remember the latter was achieved largely by cutting military spending. As the table nearby illustrates, Bill Clinton and a GOP Congress balanced the budget by withdrawing a "peace dividend" at a time when al Qaeda was declaring war. Mr. Bush, and presumably a President Kerry, must now walk that back up the hill.
Yes, you may be saying, but John Kerry says he can pay for all this by taxing those who make more than $200,000 a year--raking in $860 billion over the next decade. There are just a few problems. Current budget projections are based on current laws, which say the Bush tax cuts will phase out over the next five years unless Congress renews them. So the real take from soaking the rich a few years early will be modest, while the deficit projections will increase by a much larger margin if the middle-class tax cut is made permanent, as Mr. Kerry promises. Over the 10-year horizon his overall tax plan would reduce revenue by $602 billion, according to the Urban Institute.
The biggest canard is that Mr. Kerry will control spending by relying on spending "caps" and restoration of the "paygo" system, which required legislators to find offsets for any new tax cuts or spending. These only apply to the discretionary portion of the budget, not entitlements like Social Security and Medicare. The U.S. has just created the biggest new entitlement in half a century with the drug benefit for seniors, and Mr. Kerry wants to expand health spending still further. So paygo will do nothing to control the biggest sources of new spending.
Paygo really means that when the time comes to make the middle-class tax cuts permanent, there may not be enough money left in the discretionary part of the budget to find the offsets. So promises that tax increases will hit only the rich belong in the same category as Bill Clinton's 1992 pledge to raise taxes only on those making more than $200,000 a year and impose a "millionaire surtax." A year later that turned into a tax hike on those making as little as $114,000, while the definition of $1 million miraculously expanded to include those making as little as $125,000 a year.
While we agree that Mr. Bush has a lousy first-term spending record, he is now saying that in a second term he'd restrain non-defense increases. Mr. Kerry's stated agenda is increased spending nearly across the board and tax hikes. The voters can decide which of these better constitutes "fiscal discipline."

>> OUR PAKISTAN FOLLIES...QUOTE? "THERE WAS NO PAKISTAN POLICY WHEN WE CAME INTO OFFICE"...ANY ONE SAY HALF-BAKED POLICY?


http://www.moretothepoint.com/
The Terror Alert, Pakistan and Presidential Politics listen
Presidential nominee John Kerry has been highly critical of President Bush, but his advisors say there is no evidence that the current terror alert was politically inspired. Meantime, Howard Dean has told interviewers "the administration is manipulating the release of information in order to affect the president's campaign." Based on four year-old computer entries and a "second stream" of intelligence, information on this latest terror threat came from the computer of an al Qaeda suspect captured last month in Pakistan. While that may be good news about Pakistan's participation in the war on terror, today's New York Times reports that militant Islamic groups are still training in Pakistan and launching attacks on US and Afghan forces across the border, and last week's New Yorker reported that the Internet has become a virtual training camp


http://theworld.org/latesteditions/20040804.shtml
Pakistan interview (4:30)
Host Marco Werman speaks with Husain Huqqani, former special assistant to three former Pakistani prime ministers, about the United States' complicated relationship with Pakistan. The country appears to be ramping up cooperation with the US war on terrorism, but it also allows militant Islamic groups to train there.


Musharraf steps back from the US
By Syed Saleem Shahzad
KARACHI - "Pakistan is not sending its troops to Iraq." So reads the most recent handout from the Pakistani Foreign Office and the clearest signal yet that President General Pervez Musharraf is finally attempting to distance himself from the United States' sphere of influence, even if only for domestic expediency.
Just days ago Islamabad refused to make such a categorical statement, as demanded by hostage-takers in Iraq holding two Pakistani contract workers. The two men were subsequently beheaded.
Interim Prime Minister Chaudhary Shujaat Hussain even paid a visit to Saudi Arabia, where he announced that the countries were developing a consensus on sending Pakistani troops to Iraq. Earlier, Saudi Arabia had proposed the formation of an all-Muslim force to be sent to Iraq to help with security. Pakistan was to be a key part of this.
And the Pakistani parliament was unable to come up with a resolution calling for troops not to be dispatched to Iraq. Similarly, when US Central Command commander General John Abizaid visited Islamabad last week, apart from pressing Musharraf to deliver "high-value" foreign suspects, he reiterated the US desire that Pakistan send troops to Iraq. Pakistan said it would do this "when the time is right".
For long caught between extremist Islamists on the one hand and US pressures on the other, Musharraf appears now to be distancing himself from Washington, as least as far as troops are concerned. He is still handing over al-Qaeda suspects on a regular basis.
Asia Times Online has been told by security contacts that well before Abizaid's visit, Hussain met with leaders of the influential grouping of six religious-political parties, the Muttahida Majlis-i-Amal, and asked them to raise a voice against sending the army into Iraq and to hold protest rallies all over the country to "show to US the extreme feeling of dissent" in the country.
An observer from Karachi who was close to Musharraf when he was a major-general and posted as director general of military operations at General Headquarters, Rawalpindi, commented, "Musharraf is susceptible to pressures. He does not have the ability to respond to pressures immediately, and always takes some time before he fights back against the pressures, and only when he is sure that he has the proper support."
Mounting pressures
Islamic militants continue their insurgency in the South and North Waziristan tribal areas, where, under pressure from Washington, the army has been sent to track down foreign militants. The troops are reportedly under daily rocket and missile attacks, as well as assaults from remote-controlled bombs.
Renewed insurgency in southwestern Balochistan province, where anti-Pakistan Baloch tribals, who had been courted by the US to counteract the Taliban, have now regrouped and are inflicting serious casualties on Pakistani troops.
The designation of pro-US banker and present Finance Minister Shaukat Aziz as the next premier, subject to him winning a by-election for the Lower House, has alarmed many as he has no political constituency. This has upset traditional feudal families who have relations in the army and who fear they will lose their political clout.
These developments have caused recent tit-for-tat reactions:
Major-General Ayaz Khattak, in charge of operations in South Waziristan, escaped death in a suicide attack on his office. After the incident, when authorities were inspecting the site, another bomb was detonated by remote control, killing an Intelligence Bureau officer.
Premier-designate Aziz survived a suicide attack in which 11 others were killed.
Feedback from the latest langer gathering. (Langer means feast. The army has traditionally staged feasts for officers, soldiers and their families. They hold frank discussions, and military intelligence then compiles a special report on the chit-chat, which is presented to all corps commanders and the chief of army staff. The mood was completely against sending troops to Iraq.)
In addition, Pakistan's elite intelligence agencies, including Military Intelligence and Inter-Services Intelligence, have repeatedly warned Musharraf about adverse developments in the army, that is, against the leadership. Musharraf has even repeated this in public, notably in connection with an assassination attempt on his life in which army personnel have been implicated.
Intelligence also points to stepped-up attacks by al-Qaeda and its sympathizers, including against prominent federal cabinet members.
Deadlines loom
Two of the most important dates since Musharraf assumed power in a bloodless coup in October 1999 are close. By October 7 he must replace two full generals who are due to retire, and by the end of the year he must choose between either the presidency or chief of army staff, the two positions he now holds.
With these two events in mind, Musharraf has opted to give himself breathing space and take some of the heat out of the political climate by ending debate on sending troops to Iraq, and waiting until he has his new generals in place as they are widely expected to be promoted on the basis of loyalty to Musharraf rather than on seniority. This will cause disaffected - passed-over - officers to resign, further strengthening the general's grip.
Syed Saleem Shahzad is Asia Times Online's bureau chief in Pakistan. He can be reached at saleem_shahzad2002@yahoo.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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>> THEN AGAIN...THEY LISTEN - RIGHT?

Free Speaker
Hastert has solid economic ideas. Bush should listen.
House Speaker Dennis Hastert tends to operate behind the scenes. He's not one to make long public speeches or bask in the Washington glow. His image is more of a legislative tactician than a heavy thinker.
But it turns out that Hastert has developed a very clear set of opinions on domestic and economic policy, all of which he reveals in his just-released book, Speaker. In particular, the book has an excellent pro-growth, free-market, pro-competition policy chapter that covers taxes, education, healthcare, energy, and tort reform.
In every case the speaker comes down on the side of the people and markets -- not the government. On medical care he favors health savings accounts. On education he supports magnet, charter, or private schools. On energy he suggests full development of coal, oil, and gas reserves. On trial lawyers he proposes legislative reform to limit class-action lawsuits, especially medical liability and asbestos suits.
If Kerry takes the White House with Senate coattails in November, this worst-case scenario still leaves a Republican House. Hopefully it will act as a bulwark against galloping statism and a growing government footprint on the economy.
Hastert reassures that the House will do just that. He has some great conservative lieutenants in people like Tom Delay, Chris Cox, and David Dreier. And let's not forget that House Ways & Means chair Bill Thomas snatched victory from the jaws of defeat in the 2003 tax-cut bill -- legislation that miraculously delivered a 15 percent marginal tax rate for capital gains and dividends, along with a speed-up in the implementation of lower marginal rates on personal income. That tax reform is what really launched the economy into full-scale recovery. It may well be President Bush's savior come November.
Speaking of taxes, Hastert has some very interesting pro-growth ideas. He correctly argues that American jobs move overseas in part because of excess taxes and regulations imposed on U.S. businesses. He also notes that U.S. products are encumbered by corporate taxes and employment taxes, both of which add measurably to a product's cost and price.
"Taxes account for between 23 to 27 percent of the cost of our goods and services," he writes, "but when our products go overseas -- to France, Germany, or Japan -- our taxes stay embedded in our goods or services." European countries, however, rebate their tax burdens to the employing companies, thereby giving them a competitive cost advantage on the world market. "Our widgets have a tax burden," says Hastert. "Their widgets don't."
His tax-reform paradigm looks like this: "For us to return capital and jobs to the United States, we're going to have to change our present tax system and adopt a flat tax, a national sales tax, an ad valorem tax, or VAT. . . . it's one of the most important things we can do over the next few years."
Hastert adds that homegrown U.S. labor costs are excessively high for three reasons: taxation, litigation, and regulation. He also notes studies showing that Americans spend nearly 6.1 billion hours on their taxes annually, and that two-thirds of taxpayers believe the system is far too complex. No one knows just how big these wasteful costs really are, but we are talking about a huge chunk of change.
Hastert doesn't exactly come out for the abolition of the IRS, but he does think it would be a great thing to do down the road. The speaker cites Rep. John Linder (R., Ga.) and his national sales tax proposal. He also cites Michael Burgess, a Republican doctor from Texas, who has introduced a bill that would replace the income tax with a flat tax over a three-year period.
Either of these proposals would enhance productivity and grow the economy more rapidly, doubling national output over the next fifteen years. "The answer is to grow the economy," writes the speaker, "and the key to doing that is making sure we have a tax system that attracts capital and builds incentives to keep it here instead of forcing it out to other nations."
Looks like we have a powerful supply-side mole in the U.S. House of Representatives. The former high-school teacher has already surprised many with his strong management skills and legislative acumen. This is a man who is interested in getting things done rather than hogging the klieg lights on television. A former wrestling coach, he's the quintessential team player. He reminds me of another son of Illinois -- Ronald Reagan.
Speaker is a must read for all of us, but hopefully President Bush will have a chance to turn its pages before his crucial speech at the Republican National Convention and the last leg of the 2004 campaign trail. The plain-speaking Midwesterner has some solid ideas for the Texan's second-term agenda.
-- Larry Kudlow, NRO's Economics Editor, is CEO of Kudlow & Co. and host with Jim Cramer of CNBC's Kudlow & Cramer.


http://www.nationalreview.com/kudlow/kudlow200408050844.asp

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RETHINKING SECURITY

Our Own Worst Enemy
Why scrap a program that identified nine of the 19 hijackers? Ask civil libertarians.

BY HEATHER MAC DONALD
Thursday, August 5, 2004 12:01 a.m. EDT
Even as the Bush administration warns of an imminent terror attack, it is again allowing the "rights" brigades to dictate the parameters of national defense. The administration just cancelled a passenger screening system designed to keep terrorists off planes, acceding to the demands of "privacy" advocates. The implications of this for airline safety are bad enough. But the program's demise also signals a return to a pre-9/11 mentality, when pressure from the rights lobbies trumped security common sense.
The now-defunct program, the Computer Assisted Passenger Prescreening System, or Capps II, sought to make sure that air passengers are flying under their own identity and are not wanted as a terror suspect. It would have asked passengers to provide four pieces of information--name, address, phone number and birth date--when they make their reservation. That information would've been run against commercial records, to see if it matches up, then checked against government intelligence files to determine whether a passenger has possible terror connections. Depending on the outcome of those two checks, a passenger could have been screened more closely at the airport, or perhaps--if government intelligence on him raised alarms--not allowed to board.
Privacy advocates on both the right and the left attacked Capps II from the moment it was announced. They called it an eruption of a police state, and envisioned a gallimaufry of bizarre hidden agendas--from a pretext for oppressing evangelical Christians and gun owners, to a blank check for discriminating against blacks.
Contrary to the rights lobby, Capps II was not:
* A privacy intrusion. Passengers already give their name, address and phone number to make a flight reservation, without the slightest fuss. Adding birth date hardly changes the privacy ledger: The government and the private sector have our birth dates on file now for social security and commercial credit, among numerous other functions. Far from jealously guarding their name and address, Americans dispense personal information about themselves with abandon, in order to enjoy a multitude of consumer conveniences. (Anyone with a computer can find out reams more about us than is even hinted at in the Capps II passenger records.)
* A surveillance system. Neither the government nor the airlines would have kept any of the information beyond the safe completion of a flight. The government would have had no access to the commercial records used to check a passenger's alleged identity; those would have remained with the commercial data providers contracted to provide identity verification.
* A data mining program. This misunderstood technology seeks to use computers to spot suspicious patterns or anomalies in large data bases, sometimes for predictive analysis. Capps II had nothing to do with data mining; it was simply a primitive two-step data query system.
The advocates' most effective strategy for killing off Capps II was to bludgeon airlines into not cooperating with its development. Northwest Airlines and Jet Blue were already facing billions of dollars in lawsuits for specious "privacy" violations, trumped up by the advocates in reprisal for those airlines' earlier cooperation with the war on terror. No other airline was willing to take on a similar risk and provide passenger data to stress-test Capps II. Without the capacity to be tested, Capps II was doomed.
The Department of Homeland Security has already shown itself a weakling in bureaucratic turf battles; its capitulation to the "privocrats" means it is all but toothless. It was just such a cave-in by the Clinton administration that eased the way for the 9/11 attacks. Under pressure from the Arab and rights lobbies, the Clintonites agreed in 1997 that passengers flagged as suspicious by the then-existing flight screening system would not be interviewed. Allowing security personnel to interview suspicious flyers, it was argued, would amount to racial and ethnic profiling. On 9/11, the predecessor to Capps II identified nine of the 19 hijackers as potentially dangerous, including all five terrorists aboard American Airlines Flight 77. But pursuant to the rights-dictated rules, the only consequence of that identification was that the hijackers' checked luggage was screened for hidden explosives. Had the killers themselves been interviewed, there is a significant chance that their plot would've been uncovered.
Since the demise of Capps II, the privocrats have tipped their hand: Their real agenda isn't privacy, but a crippling of all security measures. Leading advocate Edward Hasbrouck has decried both a voluntary "registered traveler" option, in which passengers agree to a background check in order to circumvent some security measures, and physical screening at the gate. Bottom line: Any security precautions prior to flight constitute a civil liberties violation. It is mystifying why the government should pay heed to people who so disregard the public good.
It is difficult to know where we go from here. There is no way to keep a terrorist from flying without first trying to determine who he is. Yet the most innocuous identity verification system prior to a flight is now seen as tantamount to illegal surveillance. With the rights advocates back in the saddle of national security, al Qaeda can blithely get on with its business.
Ms. Mac Donald is a contributing editor to the Manhattan Institute's City Journal.

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>> AND KERRY?

Saigon on the Tigris?
John Kerry's Vietnam experience may be disastrous in Iraq
Michael Young
With all due respect to John Kerry's experiences in Vietnam (where, by his own reckoning in 1971, he committed "the same kind of atrocities as thousands of other soldiers"), has anyone really wondered what the moral of that failed venture might mean for a President Kerry in Iraq?
When it comes to Vietnam, it was John Paul Vann who embodied stubborn faith in the possibility of victory in a war most contemporaries considered a lost cause. His biography, A Bright Shining Lie, earned Neil Sheehan a Pulitzer Prize. Yet Sheehan wrote about Vann with the affection, and hard eye, one reserves for the quixotic. Kerry, in contrast, gave up on the whole affair early, and it's fair to wonder whether his faith in victory in Iraq will prove as short-lived.
Kerry would disagree. His campaign website links to a speech he gave last April at Westminster College in Fulton, Missouri (where Winston Churchill first mentioned the "Iron Curtain"). In the address, Kerry argued: "[W]e can accomplish the mission. And we must... failure is not an option in Iraq. But it is also true that failure is not an excuse for more of the same." Kerry had Vietnam on his mind when he remarked in a different context: "If we are stuck for a long period of time in a quagmire where young Americans are dying without a sense of [not failing] being... achieved, I think most Americans will decide that's failure."
True enough, but where is Kerry's cutoff point? When would he determine that the U.S. is caught in an Iraqi quagmire? Most importantly, how would this affect his policy--assuming he wins in November--on U.S. troops in Iraq?
In his acceptance speech before the Democratic Party convention, Kerry apparently had February 28, 1968 in the back of his mind. That's when the American commander in Vietnam, Gen. William Westmoreland, requested an additional 206,000 troops from President Lyndon Johnson, as well as the mobilization of reserve units. A little less than a month afterwards, Johnson effectively rejected the request by agreeing only to a token increase in forces, putting an end to major American troop escalations in Vietnam.
For Kerry, and many others, Vietnam taught that just funneling more troops into a conflict is not necessarily a solution. That's probably why he had this to say at the convention: "I will build a stronger American military. We will add 40,000 active duty troops--not in Iraq (italics mine), but to strengthen American forces that are now overstretched, overextended, and under pressure... To all who serve in our armed forces today, I say, help is on the way."
Excellent news, except apparently for those in Iraq. Kerry showed rare consistency by stating a few days after the convention, in response to a query as to whether he would increase troop numbers: "I don't envision it." In fact, on several occasions in the past months he made similar statements. Last September, for example, he said that more soldiers "would be the worst thing. We do not want to have more Americanization. We do not want a greater sense of American occupation."
The only problem was that in December Kerry said just the opposite. He told NBC's Tim Russert: "We cannot fail. I've said that many times. And if it requires more troops in order to create the stability that eliminates the chaos, that can provide the groundwork for other countries, that's what you have to do." In a Washington Post op-ed piece on July 4, posted on his website, he wrote: "We know that a chief of staff of the Army, Gen. Eric Shinseki, was right when he argued that more troops would be needed to establish security and win the peace in the weeks and months after Saddam Hussein's fall."
So, what exactly is Kerry carrying on about? He would increase troop levels by some 40,000, but has said they would not go to Iraq, where, he has repeatedly implied, U.S. forces are overstretched, overextended and under pressure. (Barring soldiers from an American theater of operations must be a military first.) But then again, we're not quite sure what Kerry intends to do in Iraq; in fact, we're not sure whether he even has a transition strategy there, or how American force structures would fit in with political developments.
That's because Kerry almost never speaks of the Iraqis as Iraqis. His denunciation of "Americanization" in Iraq harks back to the Johnson- and Nixon-era policy of "Vietnamization"--which was essentially an effort to place the burden of war on South Vietnam, so the U.S. could quietly head for the exits. If Kerry's goal is gradual "Iraqization", he's not wrong (and finds himself in bed with not a few influential neoconservatives). But shouldn't that mean the U.S. must leave something durable behind in Baghdad, so as not to replicate the debacle of April 30, 1975, when the American order in South Vietnam collapsed ignominiously?
It was remarkable that in his acceptance speech, Kerry mentioned not once what he intended for the Iraqis. Absent, too, was any mention of democracy in the Middle East. Why should a U.S. presidential candidate even bother with this? Because, as 9/11 showed, it has implications for American security. Kerry has largely avoided linking terrorism to political realities in the Middle East. That would mean addressing the neoconservative critique that only by democratizing the region and removing autocratic regimes whose stifling policies have helped generate Islamist violence can the U.S. guarantee its own long-term security.
Kerry needn't agree with the neocon hypothesis, but he must find a justifiable alternative to explain why the U.S. cannot fail in Iraq. The thing is that Kerry sees Iraq as little more than a headache that must be swiftly resolved. The broader implications of the invasion for U.S. national security and for a transformation of the Middle East are almost nonexistent in his campaigning. It may be a Kerry rarity, but he actually seems to mean it when he says that the goal in Iraq is "to get the job done and bring our troops home."
However, that begs the question: If Iraq serves no significant or enduring American objective; if the priority is solely to bring about stability (with the help of allies, Kerry insists, in a plan peddled as a silver bullet) to get out, then isn't that a pretty low threshold to validate remaining in the country if American casualties continue rising? As in Vietnam, a Kerry administration might soon conclude that a pullout short of success might, in fact, not be that damaging to U.S. interests.
Kerry is deluding himself if he thinks the solution in Iraq is bringing in allied soldiers so the U.S. can shrink its presence. No one, whether in Europe or the Arab world, wants to be cannon fodder for John Kerry. Worse, as they contemplate Kerry's absence of ambition in Iraq, as they try to decipher his contradictory statements on U.S. military policy there, as they ponder that his staying power in Iraq may be limited, and as they search for something substantive on the Middle East in his acceptance speech, the allies must be thinking that this is the guy who may turn Baghdad into Saigon, circa April 30, 1975.

Reason contributing editor Michael Young is opinion editor at the Daily Star newspaper in Beirut.
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John Kerry's Monstrous Record on Civil Liberties

The Man from Beacon Hill's "New War" on the Constitution
John Berlau
For John Kerry, the specter of Attorney General John Ashcroft trashing Americans' civil liberties has been a useful campaign prop. In campaign stops, Kerry has promised to "end the era of John Ashcroft and renew our faith in the Constitution." In a Kerry administration, he promised the liberal group MoveOn in June 2003, "there will be no John Ashcroft trampling on the Bill of Rights." In his 2004 campaign book, A Call to Service, Kerry accuses Ashcroft and the Bush administration of "relying far too much on extraordinary police powers."
In contrast, Kerry positions himself as a civil libertarian--or at least as a proponent of a reasonable balance between liberty and security. "If we are to stand as the world's role model for freedom, we need to remain vigilant about our own civil liberties," Kerry writes in A Call to Service. He calls for "rededicating ourselves to protecting civil liberties."
Kerry, like every other senator in the chamber except Russell Feingold (D-Wis.), voted for the USA PATRIOT Act in the wake of 9/11. Now he is now co-sponsoring the SAFE Act, a bipartisan measure that restricts some of the powers that the PATRIOT Act granted the government. Furthermore, he is critical of the package of proposals from Ashcroft's Department of Justice (DOJ) that has been dubbed Patriot II. Citing his experience as a prosecutor--he was an assistant district attorney in suburban Boston in the '70s--Kerry writes, "I know there's a big difference between giving the government the resources and commonsense leeway it needs to track a tough and devious foe and giving in to the temptation of taking shortcuts that will sacrifice liberties cheaply without significantly enhancing the effectiveness of law enforcement. Patriot II threatens to cross that line--and to a serious degree."
This isn't the first time Kerry and Ashcroft have been at odds over civil liberties. In the 1990s, government proposals to restrict encryption inspired a national debate. Then as now, the American Civil Liberties Union (ACLU) and electronic privacy groups locked horns with the DOJ and law enforcement agencies. Then as now, Kerry and Ashcroft were on opposite sides.
But there was noteworthy difference in those days. Then it was Sen. John Ashcroft (R-Mo.) who argued alongside the ACLU in favor of the individual's right to encrypt messages and export encryption software. Ashcroft "was kind of the go-to guy for all of us on the Republican side of the Senate," recalls David Sobel, general counsel of the Electronic Privacy Information Center.
And in what now seems like a bizarre parallel universe, it was John Kerry who was on the side of the FBI, the National Security Agency, and the DOJ. Ashcroft's predecessor at the Justice Department, Janet Reno, wanted to force companies to create a "clipper chip" for the government--a chip that could "unlock" the encryption codes individuals use to keep their messages private. When that wouldn't fly in Congress, the DOJ pushed for a "key escrow" system in which a third-party agency would have a "backdoor" key to read encrypted messages.
In the meantime, the Clinton administration classified virtually all encryption devices as "munitions" that were banned from export, putting American business at a disadvantage. In 1997 Senate Commerce Committee Chairman John McCain pushed the Secure Public Networks Act through his committee. This bill would have codified the administration's export ban and started a key escrow system. One of his original co-sponsors was his fellow Vietnam vet and good friend from across the aisle, John Kerry.
Proponents such as McCain and Kerry claimed that law enforcement could not get the key from any third-party agency without a court order. Critics responded that there were loopholes in the law, that it opened the door to abuses, and that it punished a technology rather than wrongdoers who used that technology. Some opponents argued that the idea was equivalent to giving the government an electronic key to everyone's home. "To date, we have heard a great deal about the needs of law enforcement and not enough about the privacy needs of the rest of us," said then-Sen. Ashcroft in a 1997 speech to the Computer and Communications Industry Association. "While we need to revise our laws to reflect the digital age, one thing that does not need revision is the Fourth Amendment... Now, more than ever, we must protect citizens' privacy from the excesses of an arrogant, overly powerful government."
But John Kerry would have none of this. He had just written The New War, a book about the threat of transnational criminal organizations, and he was singing a different tune on civil liberties. Responding directly to a column in Wired on encryption that said "trusting the government with your privacy is like having a Peeping Tom install your window blinds," Kerry invoked the Americans killed in 1993 bombing of the World Trade Center and the 1995 bombing of the Alfred P. Murrah Building in Oklahoma City. "[O]ne would be hard-pressed," he wrote, "to find a single grieving relative of those killed in the bombings of the World Trade Center in New York or the federal building in Oklahoma City who would not have gladly sacrificed a measure of personal privacy if it could have saved a loved one." Change a few words, and the passage could easily fit into Attorney General Ashcroft's infamous speech to the Senate Judiciary Committee in late 2001--the one where he declared, "To those who scare peace-loving people with phantoms of lost liberties, my message is this: Your tactics only aid terrorists--for they erode our national unity and diminish our resolve."
If Ashcroft was encryption advocates' go-to guy on the GOP side in the encryption debate, Kerry played that role for law enforcement among the Democrats. "John Kerry was always a pretty strong proponent of law enforcement and the military, and the NSA was not terribly crypto-friendly, and the FBI was extremely uncrypto-friendly," says Will Rodger, who covered the encryption debate for USA Today and is now public policy director at the Computer and Communications Industry Association. "John Kerry's support for limiting encryption wasn't a real shock to most people who had followed his voting record."
Eventually, the strength of the business and civil liberties opposition--plus the sheer impossibility of keeping up with encryption technology--led the Clinton administration and Kerry to accept relaxed encryption controls. Today it seems laughable that software would ever have been labeled as "munitions"; even Ashcroft's DOJ did not try to include a key escrow system in the PATRIOT Act.
"Get Their Ass and Get Their Assets"
The Bush administration is not likely to point out Kerry's position in favor of encryption control, because it is trying to paint him as soft on crime and terrorism. Kerry does hold many traditionally liberal views on crime, including a consistent opposition to the death penalty. But encryption was just one of many issues in Kerry's Senate career where he and civil libertarians were on opposite sides. And while Kerry is in some respects singing a different tune today on civil liberties, he has never walked away from his statements in The New War. In fact, he displays the book in an ad that began running in late June as evidence that he authored an antiterrorism strategy way back in the late '90s.
Although the encryption fight appears to be over, similar battles are being fought today. For instance, as with encryption, the FBI now wants preemptive design mandates so it can have an automatic mechanism to tap into Voice over Internet Protocol, the fledgling technology that allows people to make phone calls online. Once again, law enforcement wants tech firms to build a "back door" for the police. Wayne Crews, director of technology studies at the pro-market Competitive Enterprise Institute, notes that Kerry has been silent on the FBI's efforts. "The only thing I've heard from Kerry on technology regulation is continued investment from the federal government," Crews says.
This isn't the only issue that could be worrisome for civil libertarians, given Kerry's record in the '90s. In general, whenever the ACLU was aligned with business interests, Kerry took the side of law enforcement against what he called "big money."
An example is the fight over asset forfeiture. In the 1980s war on drugs, the laws were stretched so that property that had been used for criminal purposes could be seized by law enforcement even if the owner of that property was innocent. If a drug dealer rode in your car or your airplane, for example, it was subject to seizure, and you would have to sue to get it back by proving you had no knowledge that a dealer had used it for illicit purposes. This was the case even if you had never been charged with any crime. The resale of impounded property became a source of revenue--and corruption--for local police departments. Even in cases where there were actual criminal convictions, governments would often seize assets that were not related to the crime or to compensating victims.
In the mid-1990s, a bipartisan movement arose to reform the forfeiture laws, with conservative Republican Reps. Henry Hyde of Illinois and Bob Barr of Georgia joining with such liberal Democrats as Reps. John Conyers of Michigan and Barney Frank of Massachusetts. They wanted to increase the burden of proof on the government when it seized property. As with encryption, there was stiff opposition to reform from Janet Reno's Justice Department.
What was Kerry's position? He thought U.S. asset forfeiture laws were working so well that he wanted to export them. "We absolutely must push for asset forfeiture laws all over the planet," Kerry wrote in The New War. "In the words of one plainspoken lawman, 'Get their ass and get their assets.'" There was, tellingly, no discussion at all of civil liberties issues.
Kerry added that we can't reasonably expect another country "to assist us in our struggle with crime if it does not see direct benefit for itself, especially if it is among the countries with highly limited funds for law enforcement." It didn't seem to occur to Kerry that, without safeguards, countries "with highly limited funds" might go after the assets of innocent people or third parties with only a tangential relationship to the criminal. Indeed, the only "dark and dangerous underside" of international forfeiture he identified was the possibility that criminals would give up assets in exchange for avoiding jail sentences. "We must ensure that asset forfeitures do not become a substitute for serving time," he wrote. (In 2000, after being watered down by the Reno Justice Department, the Civil Asset Forfeiture Reform Act passed the Senate by a voice vote and was signed into law by Clinton. Kerry did not object on the Senate floor; neither did Sen. Ashcroft.)
Even a semi-sympathetic review in the liberal Washington Monthly called The New War "a kind of international edition of Reefer Madness," referring to the notoriously overwrought anti-drug movie of the 1930s. Kerry is a drug warrior, and after having discovered some genuine instances of bad guys' stashing their money at the $23 billion Bank of Credit and Commerce International, an international financial institution that was shut down in 1991 by various countries' bank regulators, he became a crusader against banks holding "dirty money." (BCCI had dealings with drug lords, Saddam Hussein, the PLO, and the KGB.) While it may be too much to ask a major-party presidential candidate to ponder drug prohibition's contribution to dirty money, Kerry's solution to money laundering was--and is--to deputize banks and force them to spy on all their customers.
Many on the left and right worried about overreach from the federal "Know Your Customer" regulations of 1997-98, which would have required banks to monitor every customer's "normal and expected transactions." Those proposed rules were eventually withdrawn after the ACLU, the Libertarian Party, and other groups generated more than 100,000 comments in opposition. But from his writings and statements, John Kerry seemed worried that the regulations did not go far enough. "If the standards by which banks accept money were lived up to with the same diligence as that by which most banks lend money, the 'know your customer' maxim would have teeth," he wrote in The New War. "But too many bankers pretend they are doing all they can to know what money crosses their threshold and pretend they are not as key as they are to law-enforcement efforts."
Kerry then expressed his belief that bank customers are entitled to essentially zero privacy. "The technology is already available to monitor all electronic money transfers," he wrote (emphasis added). "We need the will to make sure it is put in place."
Has a politician who seven years ago proposed all electronic transfers be monitored changed his views on civil liberties? Officials from Kerry's Senate office and presidential campaign promised to have someone answer questions about his civil liberties positions, but no one ever had. A close look at his campaign's statements on the PATRIOT Act, however, reveals that there is less to his opposition than meets the eye.
As noted above, Kerry is cosponsoring the SAFE Act, which would limit the circumstances under which "sneak- and-peek" warrants can be issued under the PATRIOT Act. (PATRIOT broadened the government's power to conduct such searches, in which the person whose property is examined is not notified.) It also put more brakes on PATRIOT provisions that give the FBI the power to search records on individuals held by third parties--such as libraries, bookstores, and Internet service providers--and the power to require the third parties to keep silent about the search. But Kerry signed onto the SAFE Act only after his right flank was protected; the bill's original co-sponsors included conservative Sens. Larry Craig (R-Idaho) and Lisa Murkowski (R-Alaska) as well as Feingold. More tellingly, Kerry's support is premised on what he calls Ashcroft's abuses of the PATRIOT Act, not on PATRIOT itself. "John Kerry stands by his vote for the Patriot Act," says a March 11 campaign statement. "You can sum up the problems with the Patriot Act in two words: John Ashcroft... The real problem with the Patriot Act is not the law, but the abuse of the law."
In fact, the "real problem" is the law's provisions, which would be troubling in any administration. Responding to Kerry's statement, Gregory T. Nojeim, associate director of the ACLU's Washington National Office, says, "People from the left to the right agree that John Ashcroft is no civil liberties angel, but the problems of sneak-and-peek warrants and an overbroad notion of what constitutes terrorism are dangerous in the hands of any attorney general." Nojeim observes that the definition of terrorism is so broad that it could cover groups practicing civil disobedience, such as the anti-abortion Operation Rescue.
Meanwhile, Kerry continues to support intrusive efforts to stamp out money laundering. His campaign statement points out that Kerry "authored most of the money laundering provisions" in PATRIOT. Those provisions were largely based on an old money laundering bill that Kerry had introduced and which was opposed by economic conservatives and the ACLU. Kerry and other Democrats insisted that the money laundering provisions be attached to the PATRIOT Act. An October 2001 Associated Press article quoted Kerry as accusing Republicans of trying to remove the provisions "by fiat." The article noted that Kerry "underlined the political influence of Texas bankers."
The money laundering provisions, which became Title III of the PATRIOT Act, are some of the most privacy-threatening aspects of the bill. (See "Show Us Your Money," November 2003.) They go beyond the "Know Your Customer" rules of the late 1990s, bringing real estate brokers, travel agents, auto dealers, and various other businesses under the rubric of "financial institutions" that must monitor their customers and file "suspicious activity reports" on deviations from customers' normal patterns.
It was the Title III money laundering provisions that the FBI used in the much-criticized Operation G-String, an investigation of a strip club owner in Las Vegas accused of bribing local officials. The case had nothing to do with terrorism. Tellingly, Kerry--whose provisions allowed it to happen--has not cited this operation as one of Ashcroft's abuses, even though other Democrats have.
We have been told repeatedly that the world has changed since 9/11. Indeed, that is the explanation many have offered for Ashcroft's change of heart on civil liberties. But what about a candidate who, well before 9/11, consistently advocated measures that would have eroded those liberties? Would he be more or less constrained in the middle of a war on terror? To raise the issue is to take Kerry's own advice from his new book--that we "remain vigilant about our own civil liberties."
John Berlau is a writer for Insight magazine.
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VETS CHARGE: KERRY KILLED FLEEING TEEN; LIED FOR MEDAL

Slaughters Animals, Burns Down Tiny Village

**Exclusive**
A veterans group seeking to deeply discredit Democrat John Kerry's military service will charge in the new bombshell book UNFIT FOR COMMAND:
"Kerry earned his Silver Star by killing a lone, fleeing, teenage Viet Cong in a loincloth."
"And if Kerry's superiors had known the truth at the time, they would never have recommended him for the medal."
The book also claims to detail how Kerry personally ordered the slaughter of small animals at a small hamlet along the Song Bo De River.
The book, set for release next week, hit #1 on the AMAZON hitparade after the DRUDGE REPORT revealed details of the book -- a book the Kerry camapign believes is the"the dirtiest of all dirty tricks ever played on a candidate for the presidency."
The Kerry campaign is planning to vigorously counter the charges and will accuse the veteran's groups of being well-financed by a top Bush donor from Texas.
The vets have launched a blistering new TV commercial questioning Kerry's honor and calling him a liar.
George Bates, an officer in Coastal Division 11, participated in numerous operations with Kerry. In UNFIT FOR COMMAND, Bates recalls a particular patrol with Kerry on the Song Bo De River. He is still "haunted" by the incident:
With Kerry in the lead, the boats approached a small hamlet with three or four grass huts. Pigs and chickens were milling around peacefully. As the boats drew closer, the villagers fled. There were no political symbols or flags in evidence in the tiny village. It was obvious to Bates that existing policies, decency, and good sense required the boats to simply move on.
Instead, Kerry beached his boat directly in the small settlement. Upon his command, the numerous small animals were slaughtered by heavy-caliber machine guns. Acting more like a pirate than a naval officer, Kerry disembarked and ran around with a Zippo lighter, burning up the entire hamlet.
Bates has never forgotten Kerry's actions.
UNFIT FOR COMMAND, DRUDGE has learned, claims Kerry "earned his Silver Star by killing a lone, fleeing, teenage Viet Cong in a loincloth."
ARE THE VETS TELLING THE TRUTH?
"They hired a goddamn private investigator to dig up trash!" charged a top Kerry adviser traveling with the senator late Tuesday. "This is pay for play... How low can they go?"
Kerry supporters are comparing the effort by the veterans to the Arkansas State troopers tell-all against Bill Clinton.
John O'Neill, co-author of UNFIT FOR COMMAND, believes that "Kerry's Star would never have been awarded had his actions been reviewed through normal channels. In his case, he was awarded the medal two days after the incident with no review. The medal was arranged to boost the morale of Coastal Division 11, but it was based on false and incomplete information provided by Kerry himself."
According to Kerry's Silver Star citation, Kerry was in command of a three-boat mission on the Dong Cung River. As the boats approached the target area, they came under intense enemy fire. Kerry ordered his boat to attack and all boats opened fire. He then beached directly in front of the enemy ambushers. In the battle that followed, the crews captured enemy weapons. His boat then moved further up the river to suppress more enemy fire. A rocket exploded near Kerry's boat, and he ordered to charge the enemy. Kerry beached his boat 10 feet from the rocket position and led a landing party ashore to pursue the enemy.
Kerry' citation reads: "The extraordinary daring and personal courage of Lt. Kerry in attacking a numerically superior force in the face of intense fire were responsible for the highly successful mission."
Here's what O'Neill and the Swiftees say: "According to Kerry's crewman Michael Madeiros, Kerry had an agreement with him to turn the boat in and onto the beach if fired upon. Each of the three boats involved in the operation was involved in the agreement." O'Neill writes that one crewman even recalls a discussion of probable medals.
Doug Reese, a pro Kerry Army veteran, recounted what happened that day to O'Neill, "Far from being alone, the boats were loaded with many soldiers commanded by Reese and two other advisors. When fired at, Reese's boat--not Kerry's--was the first to beach in the ambush zone. Then Reese and other troops and advisors (not Kerry) disembarked, killing a number of Viet Cong and capturing a number of weapons. None of the participants from Reese's boat received Silver Stars.
O'Neill continues: "Kerry's boat moved slightly downstream and was struck by a rocket-propelled grenade. . . .A young Viet Cong in a loincloth popped out of a hole, clutching a grenade launcher, which may or may not have been loaded. . . Tom Belodeau, a forward gunner, shot the Viet Cong with an M-60 machine gun in the leg as he fled. . . . Kerry and Medeiros (who had many troops in their boat) took off, perhaps with others, and followed the young Viet Cong and shot him in the back, behind a lean to."
O'Neill concludes "Whether Kerry's dispatching of a fleeing, wounded, armed or unarmed teenage enemy was in accordance with the customs of war, it is very clear that many Vietnam veterans and most Swiftees do not consider this action to be the stuff of which medals of any kind are awarded; nor would it even be a good story if told in the cold details of reality. There is no indication that Kerry ever reported that the Viet Cong was wounded and fleeing when dispatched. Likewise, the citation simply ignores the presence of the soldiers and advisors who actually 'captured the enemy weapons' and routed the Viet Cong. . . . [and] that Kerry attacked a 'numerically superior force in the face of intense fire' is simply false. There was little or no fire after Kerry followed the plan. . . . The lone, wounded, fleeing young Viet Cong in a loincloth was hardly a force superior to the heavily armed Swift Boat and its crew and the soldiers carried aboard."
DRUDGE learns from UNFIT FOR COMMAND that if Kerry's superior officers knew the truth, they would never have recommended the award:
"Admiral Roy Hoffmann, who sent a Bravo Zulu (meaning "good work"), to Kerry upon learning of the incident, was very surprised to discover in 2004 what had actually occurred. Hoffmann had been told that Kerry had spontaneously beached next to the bunker and almost single-handedly routed a bunkered force in Viet Cong. He was shocked to find out that Kerry had beached his boat second in a preplanned operation, and that he had killed a single, wounded teenage foe as he fled."
"Commander Geoge Elliott, who wrote up the initial draft of Kerry's Silver Star citation, confirms that neither he, nor anyone else in the Silver Star process that he knows, realized before 1996 that Kerry was facing a single, wounded young Viet Cong fleeing in a loincloth. While Commander Elliott and many other Swiftees believe that Kerry committed no crime in killing the fleeing, wounded enemy (with a loaded or empty launcher), others feel differently. Commander Elliott indicates that a Silver Star recommendation would not have been made by him had he been aware of the actual facts."

Developing....
Filed By Matt Drudge
Reports are moved when circumstances warrant
http://www.drudgereport.com for updates
(c)DRUDGE REPORT 2004
Not for reproduction without permission of the author
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>> OUR FRIENDS THE ARABS

Prickly, paranoid and occasionally pragmatic

Aug 5th 2004
From The Economist print edition
Why is it so hard for Arabs to act together to solve the region's manifold problems, from the humanitarian crisis in Sudan to the turmoil in Iraq and Palestine?
SUSPICION of America runs deep in the Arab world. At a Cairo dinner party this week, a sophisticated Egyptian businessman asks why there is so much noise about the humanitarian crisis in western Sudan. "What is it America wants from Darfur? Is there oil there? Uranium?" On the al-Jazeera satellite TV channel, the Arab world's most popular, an Iraqi commentator suggests that America was behind last week's bombings of Iraqi churches "because they want to taint the noble Iraqi resistance with the crime and create chaos to continue the occupation."
Whether such views are paranoid or, perhaps, cynically savvy, they carry influence. Many Arab governments would sincerely like to help heal festering regional sores such as the mayhem in Iraq and the misery in Palestine and Darfur. Not only would this reduce the risk of infection, it would also improve the strained relations with the superpower. But popular distrust of western, and particularly American, motives keeps getting in the way.
Take the case of Iraq. After meetings last week with Colin Powell, the American secretary of state, and with Iyad Allawi, the Iraqi prime minister, Saudi Arabia's foreign minister, Prince Saud al-Faisal, suggested that several Arab and Muslim countries were prepared to send an armed force to help police Iraq. By lending Islamic legitimacy to Iraq's transitional government, such a move could do much to quell the lingering hostility to it, both within Iraq and the surrounding region. This would please the beleaguered Mr Allawi and the equally beleaguered American-led coalition backing him. Government sources in Baghdad were quick to announce that six predominantly Muslim countries (Malaysia, Morocco, Nigeria, Pakistan, Tunisia and Yemen) had agreed to send troops, with Egypt offering technical support and oil-rich Gulf states some $2 billion to pay for the operation.
Yet scarcely was Mr Powell's plane out of Saudi skies before the caveats blew in. The Islamic force was meant to replace the current coalition, not complement it, elaborated Prince Saud, and even then only at the express request of an Iraqi government that had "the full and clear support of the Iraqi people". Rushing to Saudi Arabia with more cold water, Amr Moussa, secretary-general of the Arab League, said that it was simply "not possible" for Arab or Muslim intervention forces to operate under anything but a United Nations command. Yemen flatly denied that it had any intention of sending soldiers to Iraq.
To find reasons for the hasty retreat, look no further than the opinion pages in the Arab press. The troops offer was not really Saudi, said the popular London-based daily, Al-Quds al-Arabi, "but rather American orders clothed in Saudi garb so as to be more acceptable to other Muslim and Arab countries who are keen to please the American administration and fend off its official pressure to introduce reforms". Talal Salman, editor of the Beirut daily, Al-Safir, commented acidly: "Washington has discovered that there are `unemployed' Arab armies that have no duties, save to subdue Arab masses, and that those Arab armies could be employed in saving the United States from the Iraqi quagmire."
The Arab response to the Darfur crisis has been similarly fork-tongued. Countries such as Saudi Arabia and Egypt have dispatched planeloads of aid to the stricken region but also lobbied to ensure that the UN Security Council refrained from threatening sanctions against the Sudanese regime, which is largely responsible for creating the mess. Sudan's Arab neighbours do have an interest in supporting the government in Khartoum. They do not want Iraq-style chaos next door that could ensue if it falls. But they are also exposed to public pressure to prevent another western intrusion into Arab land.
Sudan's interior minister, General Abd al-Rahim Hussein, accuses America of fomenting unrest in Darfur "just as in Afghanistan and Iraq". Another minister suggests America is acting under "Zionist pressure" to intervene. Such views echo widely. The West, insists Egypt's Muslim Brotherhood, is exaggerating the humanitarian crisis to find a pretext for invasion. A commentator in Syria's state-owned daily, Al-Thawra, says that while America sheds "crocodile tears", its real plan is to "swallow" another chunk of Arab real estate.
Peace-minded Arab governments have been similarly hamstrung over recent travails in Palestine. Egypt and Jordan, both American allies with strong ties to the Palestinians, have long since quietly concluded that Yasser Arafat has become an obstacle to progress. But Israel's impounding of the Palestinian leader, along with America's support for this and other harsh policies, has made it harder for his old friends publicly to tell him to step aside. This week Jordan's King Abdullah got embroiled in rows among fellow Arabs after accusing the Palestinians' leadership of being weak and divided.
Egypt as middleman
This is not to say that Arab governments have always failed to help resolve such problems, when they can do so discreetly. Egypt is again hosting a round of closed talks to patch up bitter disagreements between Palestinian factions, and has committed itself to helping secure Gaza in the event of an Israeli withdrawal. It has supported France's deployment of troops along the Chad-Sudan border, and itself sent advisers to join the small Darfur monitoring force run by the African Union. The Arab League has also taken a belated interest in Darfur, scheduling an emergency meeting of Arab foreign ministers to discuss the issue. Libya has helped speed relief supplies to the region and now appears to have agreed to sponsor peace talks between the Darfur rebels and the Sudanese government.
Fellow Arabs have also grown more solicitous for the welfare of Iraq. The increasingly indiscriminate savagery of the Iraqi insurgents and their increasingly radical Islamist overtones appear to have persuaded many non-Iraqi Arabs of the need to tame them. However faint-hearted, the Saudi troops initiative was a sign of this new urgency. Mr Allawi also got a warm reception during a recent tour of eight Arab capitals. Kuwait and Iraq have ended a 14-year hiatus in diplomatic relations. Even Syria, which has long been accused of turning a blind eye to the infiltration of jihadis from its territory, has promised to seal its borders better, and perhaps even to expand the capacity of pipelines taking Iraqi oil to its Mediterranean ports.
Obviously, all the region's problems could be dealt with more effectively if there were more trust in the atmosphere. And what would it take to create it? More western sensitivity to Arab concerns and a less blinkered Arab prickliness about the sacredness of sovereignty in countries with vicious regimes--and about the nobility of "resistance" to any government that is friendly to the United States.
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.
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U.S., Iraqi forces in major move to secure Syrian border
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, August 4, 2004
BAGHDAD - The U.S. military, backed by Iraqi forces, has launched its first major operation along the border with Syria.
U.S. officials said Operation Phantom Linebacker has mobilized thousands of U.S. and Iraqi soldiers as well as armored combat vehicles, unmanned air vehicles and helicopters in an effort to stem the flow of insurgents, funds and weapons from Syria into Iraq.
The officials said the operation came in wake of a determination that the Sunni insurgency, including support for Abu Mussib Al Zarqawi, was coming mainly from Saddam Hussein loyalists who have fled to Syria.
The operation began on Aug. 2 and included the Iraqi Border Police and Iraqi National Guard, Middle East Newsline reported.
"Our first priority will be on the Syrian border," Lt. Gen. Thomas Metz, commander of U.S. forces in Iraq, said, "because we think that's where the former regime leadership and money went, in that direction, and it's coming back in from that direction."
Officials said the operation was the largest by the United States to stop weapons from Syria. Earlier missions involved mainly fixed- and rotary-wing aircraft in pursuit of Sunni insurgents along the more than 500 kilometer Iraqi-Syrian border.
The U.S. Army has not announced Operation Phantom Linebacker. But the military said two marines died in fighting in the Anbar province during "security and stability operations" along the Syrian border. No other details were provided.
Officials said Syrian officials have provided passports and official documents to Sunni insurgents in exchange for hefty bribes. They said the insurgents have also bribed Iraqi security forces deployed along the border.
Operation Phantom Linebacker, which has included the 1st Marine Expeditionary Force, has also deployed UAVs as well as U.S. satellites to track the insurgency route. Officials said the first line of operations was being conducted by Iraqi security forces, with U.S. troops providing intelligence and support.
The U.S.-led operation came in wake of several warnings by Baghdad to both Iran and Syria to stem the flow of fighters, weapons and funding to the insurgency in Iraq. Senior Iraqi officials have been more critical of Iran than Syria, accusing the latter of seeking to undermine the new interim government in Baghdad.
On Wednesday, an Iraqi government delegation discussed border security cooperation with Iran. The delegation was said to have been in Teheran for a week and discussed border security and Iranian interference in Iraq.
Officials said the current operation along the Syrian border could press Iran to launch measures to stem the flow of insurgents into Iraq.
They said Saddam loyalists have established a network in Syria to train and fund insurgents to fight the U.S.-led coalition and Iraqi government. The loyalists were said to have fueled the insurgency in such Sunni Triangle cities as Faluja, Ramadi and Samara.
In July, Iraq and Syria signed an agreement for border security. But even as the agreement was announced Iraqi officials expressed doubt whether the regime of Syrian President Bashar Assad would honor the accord.

Copyright ? 2004 East West Services, Inc.

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Projecting western logic on the Beijing regime
By Sol Sanders
SPECIAL TO WORLD TRIBUNE.COM
August 4, 2004
In the late James Jesus Angleton's "wilderness of mirrors" - geopolitical intelligence - nothing is so tempting but fraught with what Cold War Warriors used to call mirror-imaging than projecting your own logic and motivations. Nor is there a more likely object for such misperception than the Beijing regime.
In a world of logic, China would have fairly clear goals. Economic development for the world's largest and one of the poorest populations. Preserving markets and technological transfer from the U.S. - the largest role in recent rapid development of littoral China. Access for increasing raw materials. Contributing to an environment of international collaboration - at least until Beijing commands real world power. A gradual liberalization of internal controls- if for not other reason than to permit rational economic decision-making.
But that is our logic. Is it the Chinese leaders'?
The continuing problem in trying to answer, of course,is the lack of transparency. That not only includes government but the rigidly controlled media and divining so-called nonofficial spokesmen. If it were not difficult enough, analysis now must include growing competition among China's three principle leaders and their claques. In summer 2004, an additional hazard is whether - like so many inside and outside the U.S. - Beijing is waiting for the November U.S. political decision. Or whether they might indeed believe [from their orthodox Marxist past] there is inevitability about American policy.
The world does not stand still for the American elections, however. Nor has Chinese leadership been able to stop taking positions in the maelstrom of world events.
North Korea: Beijing professes to want a nuclear weapons free peninsula. It convoked the interested parties, a gesture to U.S. policy to avoid bilateral negotiations with Pyongyang. Yet China has simply endorsed Pyongyang's positions. Furthermore, China's continued support of North Korea's economy permits Pyongyang to refuse compromise. That includes American offers of aid for if the bankrupt regime submits to verifiable destruction of its nuclear weapons.
Taiwan: A public rebuke by President Bush for Taiwan's President Chen seems only to have encouraged a harder line by Beijing. It continues to tweak its military buildup toward Taiwan - expensive purchases of Russian aircraft [rather the longer route of domestic development] and a continuing missiles buildup. Yet, the huge Taiwan investment in China and accompanying technical transfer is integral to the relationship. Granted Taiwan may constitute a "domestic" issue for Beijing [its hint of provincial autonomy], the growing economic relationship would be portent of a closer relationship achieved peacefully. The threat of force may eventually intimidate the Taiwanese [and even Washington]. But the evidence so far is the exact opposite effect in Taiwan and aggravation of U.S.-China relations.
Hong Kong: Reversing the policy of keeping the Chinese military garrison in the closet with a show of strength for Army Day July 31 was a clumsy attempt to intimidate the democrats. Rather than permit modification of his stumbling administration, Beijing has endorsed the failed tactics of Governor Tung. Again, perhaps repression will be effective. But it risks eroding a regime of law and minimum corruption from which China has long profited. Surely it suggested itself as a model for growing complexity in the Mainland political-economy. Perhaps destroying the identity of Hong Kong is seen as necessary in Beijing, but it risks killing the goose that still plays a powerful role in China's economic wellbeing.
Oil: With her crude imports climbing more than 20 percent and refined product 40 percent this year, China has been scurrying around looking to tie down new sources. That has included President Hu visiting otherwise insignificant African states. But Beijing has thrown its weight against U.S. efforts to step up security in the Straits of Malacca, the chokepoint through which most of China's imports flow. [And party hacks descended on Singapore for its increasingly close relations with Washington -- and a recent visit by its prime minister-designate to Taiwan.]
Human Rights: Not only has Beijing refused to make any amends for Tiananman - demanded by some of the regime's most loyal adherents - but its crackdowns on the Internet, haphazardly at minor critics, repression of religious groups, and helter-skelter media repression, is a crazy quilt of repression. How to halt the increasing corruption - some like the Bank of China in the highest places - threatening to twist economic development out of shape? How to ameliorate growing peasant and worker protests, some of them to the streets of Beijing, despite draconian controls? The argument most Chinese simply want stability at any cost notwithstanding, can any society remain stable without safety valves for conflict and dissent?
Those are only some of the contradictions.
How much is this confusion in the ranks of a lackluster leadership increasingly beset with myriad problems? How much is it feuding leaders in search of issues to hammer each other? And how much is it a conviction among paranoid Chinese Communist leadership that its real priority is to meet attack in a hostile world?
Sol W. Sanders, (solsanders@comcast.net), is an Asian specialist with more than 25 years in the region, and a former correspondent for Business Week, U.S. News & World Report and United Press International. He writes weekly for World Tribune.com.

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Deng's daughter joins struggle for Chinese reform
By Wang Chu

HONG KONG - With less than two months before what is expected to be a transformative session of the Chinese Communist Party Congress, the struggle for power is intensifying - and the daughter of Deng Xiaoping, the revered father of economic reform, is weighing in on the side of the economic and political reformers. Her message: When Daddy retired, he bowed out and stayed out of politics. By implication, former president Jiang Zemin should do the same.
In one corner of the ring is reformist President Hu Jintao and his ally Premier Wen Jiabao, urging major economic reforms to slow the overheated economy and radical reforms of the Chinese Communist Party (CCP) itself, making it more accountable, democratic and transparent. In the other corner is China's "phantom regent," former president Jiang, who clings to power at the age of 78. He is chairman of the CCP's powerful Central Military Commission - the commander in chief. He and his so-called "Shanghai Clique" especially oppose the political reforms that would deprive them of influence.
The party congress will be held in September, but the date has not been announced; many observers expect it to be late in the month.
Deng Lin, the oldest daughter of the late paramount leader Deng Xiaoping, shared her memories of her father (who died in 1997) in an interview on state-run China Central Television (CCTV) on July 28. Deng was considered the ultimate pragmatist and economic reformer, responsible for China's opening up. "He often had breakfast at 8am and processed documents at 9am. In the early days after retirement, he read only a few of the stacks of documents, and he simply quit it later on. I see that he was sincerely willing to be a man in the street," bowing out of politics, she recalled. Deng Lin has been a successful painter, at one time selling her work to billionaires in Hong Kong.
Deng Lin apparently cited her father in retirement as an example to suggest that other retired leaders should not interfere with the new administration of younger officials. "For another thing, when [my father] handed over the job, he put his trust in the successors and let them grow by working on their own. He believed they would not make progress if there was intervention. That's why I insist that he's right in many ways," she said.
These words may have embarrassed the "regent" Jiang Zemin, who left the office of the CCP general secretary and the Chinese president last year but retained command of the armed forces as head of the military commission. On July 26, Jiang met with representatives of the troops and made a public address that was generally interpreted as endorsing his protege - Shanghai CCP chief Chen Liangyu, who lashed out at the macro-control policy implemented by Premier Wen and President Hu. The macro-controls call for limiting investment in key overheated sectors such as steel, cement and real estate.
For a long time, Jiang has been seeking recognition of his robust health in a bid to maintain his influence. On July 8, he greeted US National Security Adviser Condoleezza Rice by saying, "You look younger." Perhaps he was expecting a reciprocal "And so do you" from Rice, but she said nothing of the sort. In July 2003 when meeting with British Prime Minister Tony Blair, Jaing said: "They say I'm still young."
Besides Deng Lin, Beijing Mayor Wang Qishan is also believed to be joining the Hu-Wen camp. Recently, Wang demanded that the city host a frugal Olympics in 2008, and enacted seven revolutionary regulations to rectify the super-heated construction industry. While most fence-sitters are still vacillating between the reformists and the conservatives, some important figures clearly have already chosen sides.
Jiang's relations with Deng family strained
August 22 will mark the birth centennial of Deng Xiaoping, and large-scale commemorations have been scheduled in Beijing. Some already have gotten under way, almost four weeks before his birthdate. Political observers regard such a high-profile celebration of the reformer Deng as the latest attempts by President Hu to project Deng's influence - he is still revered - to contain his political rival and predecessor Jiang.
According to an informed source, cracks appear in Jiang's relations with the Deng family after Deng Xiaoping died in 1997. The year 2002 marked the 10th anniversary of Deng's inspection tour of southern China and the fifth anniversary of his death. During the tour, Deng successfully pushed through deepening economic reform amid conservative opposition and doubts.
At that time, the Deng family looked forward to some memorials. However, the authorities surprisingly decided to put aside Deng-related commemorations and focus on the seventh anniversary of Jiang Zemin's speech concerning the eight principles regarding Beijing-Taipei relations, delivered in 1995.
In Chinese political culture, the fifth and 10th anniversaries are usually considered more important and meaningful than odd-number anniversaries, such as the seventh. Jiang was said to be the string-puller behind the arrangement that elevated his own address and sidelined Deng. That irritated Deng's family. As a result, its relationship with Jiang soon deteriorated.
In fact, after January 2001, Jiang seldom mentioned the theory of Deng Xiaoping. At a national meeting on propaganda held that January 10, then president Jiang concentrated on his self-invented theory of the "Three Represents" and did not once refer to Deng. Some observed that Jiang appeared ambitious to claim credit for China's achievements and elevate himself to the same levels as Mao Zedong and Deng Xiaoping. To his satisfaction, the theory of "Three Represents" was eventually added into the Chinese constitution early this year. However, his name was kept out and not linked to it. Some believed that not mentioning Jiang was the result of intervention by the new President Hu Jintao, who sought to undermine Jiang's influence.
(The Three Represents says the CCP must always represent "the development trend of China's advanced productive forces, the orientation of China's advanced culture, and the fundamental interests of the overwhelming majority of the Chinese people".)
Marked differences existed between Deng and his successor Jiang. As part of the efforts to commemorate the deceased leader, the party's official magazine Ban Yue Tan (China Comment) recently carried an article with some memories of Deng's visit to Guangdong province 12 years ago. According to accounts by an accompanying official, Deng sent out orders to the subordinate governments long before leaving Beijing, in a bid to keep the visit low-profile and minimize the interruption to routine work: no specific reporting by officials, no inscriptions, no media interviews.
In contrast, when touring the south early this year, Jiang's visit was as high-profile as possible, all the way. First, he summoned officials in Guangdong for reporting; a few senior party and military officials who were supposed to attend the plenum of provincial People's Congress chose to accompany Jiang instead. As if to make himself remembered forever, Jiang left inscriptions for various projects or construction sites, and his writing can be found throughout the country. However, sometimes he wrote the wrong words in the wrong place. For example, he once left an inscription for a large project in northern China's Hebei province, but he vowed there to build a massive university complex. Soon the project was implicated in unauthorized massive investment and consequently halted, discrediting the former president in the eyes of many.
Deng's daughter Deng Lin, in her interview with the party's main broadcast mouthpiece CCTV, reaffirmed her father's hands-off approach after retirement and his strong faith in his successors. "I think, from every single perspective, he [was] right in his decision to leave the job entirely to his successor without unnecessary interference. This could help speed up the maturity of the younger generations in the party," Deng Lin said.
Noticeably, she further stressed that Deng Xiaoping set a positive example in power handover and injection of new blood to the leadership. In 1989, on his own initiative, Deng offered to resign as the chairman of the Communist Party Central Military Commission. As early as in 1980, Deng had already proposed to abolish the life term of senior positions of both the government and the party.
Some China experts maintain that the remarks from Deng's daughter, made so close to the upcoming party plenum, puts pressure on Jiang in his power struggle with Hu. It remains to be seen which camp will gain the upper hand in Zhongnanhai, Beijing's seat of power, and how the agenda of the plenum will be affected on issues of political and economic reform.
(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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China anti-poverty loans go to favored business
By Lynette Ong
CHENGDU - When one enters the building that houses the Poverty Alleviation Office in a poor county in rural Sichuan, the polished floors and air-conditioned offices catch one by surprise. In no way is the comfortable and well-appointed office indicative of the nature of this organization that has been given the mission of helping the massive number of poor in this "poor county by national standards" with an average per capita income of about 1,000 yuan (US$120).
The definition of a "poor county by national standards" can be misleading and unclear because it depends not only on the poverty level of the area but also the locality's bargaining position in Beijing's elite policymaking circle. Most local authorities lobby for the poor-county title to qualify for soft money from the central government. However, this particular county in Sichuan is indeed "poor by national standards", since its economy depends to a large extent on the remittances from local residents who work in other parts of the country. These migrant workers constitute more than half of the county's total workforce.
Director Yu, giving only his family name, of the Poverty Alleviation Office was quick to impress a foreigner with the massive sum of money the Chinese government has set aside every year to help improve the standard of living of the rural poor, as well as the magnitude of funds the county - despite its poverty it has good representation in Beijing - has managed to secure from the central authority. Allocations from the central Ministry of Finance for poverty-alleviation projects in the county are no less than 15 million yuan ($1.8 million) a year. Poverty-alleviation projects are mostly for infrastructure building, such as construction of roads and water tanks, as well as for health care and education. That aside, another 100 million yuan ($12 million) of subsidized poverty loans has been made available for the county. Yu became reticent when Asia Times Online inquired to whom the poverty loans have been disbursed, and at what loan-repayment interest rates.
The subsidized poverty loan program is a centerpiece of the Chinese government's policies to alleviate poverty and to narrow the wide gulf between the rich and the poor. Since its inception in 1994, its implementation has been plagued with problems, including deciding the agency best suited for delivering the loans, the criteria for selecting the loan recipients, and its very low repayment rate, which is officially estimated at around 50%, but in fact could be as low as 20-30%, according to informed sources familiar with the program.
The Agricultural Development Bank of China (ADBC), a non-profit-making policy bank, was originally charged with delivering the poverty loans. Nonetheless, after a massive corruption scandal in 1998, the delivery was transferred to the Agricultural Bank of China (ABC), a state-owned commercial bank. On a nationwide scale, the ABC is responsible for disbursing 10 billion yuan a year to poor agricultural households that are in need of credit for investment in agriculture and animal husbandry. Borrowers pay a subsidized interest rate of 2.88% per year, while the central Ministry of Finance in turn compensates the ABC for the difference in monetary value between the market and the subsidized rates.
Based on my interviews with hundreds of poor households over a three-month period in rural Sichuan, most of them have not even heard of these anti-poverty loans, and very few have actually benefited from the program. Ironically, the beneficiaries are those with good guanxi (connections) with the relevant officials. Some studies suggest that less than 10% of the loans nationwide have actually reached the hands of the households.
A fundamental problem with most subsidized loans is the incentive issue. The borrowers have little incentive to repay the loans since they face no legal consequences for their non-payment, and their delinquency or bad credit does not affect their ability to borrow from other sources. In rural China, where legal enforcement is almost non-existent, collateral and guarantors that are common in Western societies mean nothing to the creditors. On the other hand, the bank officers in charge of disbursing the loans have little incentive to ensure prompt repayment. They probably gain more by colluding with the borrowers who could offer them some rewards in exchange for access to the subsidized credit. In essence, the subsidized loan program in China suffers from serious lack of supervisory and regulatory mechanisms that provide appropriate "carrots and sticks" for both lenders and borrowers.
Another problem with subsidized credit lies with the organization design that is unique to China. The credit program is jointly managed by the Agricultural Bank of China and the Poverty Alleviation Office: the former takes control of the funds, and is in charge of disbursement and collection, while the latter is responsible for giving its formal approval in order for the ABC to obtain interest subsidies from the central finance. The Poverty Alleviation Office is led by the State Council in Beijing, but at the county level, it reports to the Poverty Alleviation Office at the prefecture level (one level above county) as well as to the county party committee and county government.
The "dual leadership" structure, or shuangchong lingdao, is a characteristic of all administrative units in China. In a similar fashion, though all ABC branches throughout the country are managed by the headquarters in Beijing, those at local levels are highly influenced by the local governments. What this means is that loan allocations often suffer from "administrative inference" by local authorities.
In this particular county in rural Sichuan, the totality of poverty loans, about 100 million yuan a year, is now lent to an electricity plant, a major project approved by the county party committee. When Director Yu was asked why this profit-maximizing company instead of the poor households deserves the interest-rate subsidies, he said, "Well, upon completion, the plant is able to contribute significantly to the county government's tax revenue."
(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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Energy Independence: The Ever-Receding Mirage
30 years of presidential futility and failure
Ronald Bailey
President Bush and his Democratic opponent John Kerry are both for "energy independence"--like every other president for a generation. That elusive, but ultimately pointless, quest has been a central feature in American politics and policy for the past 30 years, ever since the October 1973 embargo on oil exports to the United States launched by Saudi Arabia, Algeria, Bahrain, Abu Dhabi, and Libya.
By January 1974, oil prices had risen from $3 to $11 per barrel. In response to the embargo, President Richard Nixon did lots of counterproductive things, including imposing oil price controls and lowering highway speed limits. Nixon also launched Project Independence, declaring, "Let this be our national goal: At the end of this decade, in the year 1980, the United States will not be dependent on any other country for the energy we need to provide our jobs, to heat our homes, and to keep our transportation moving." (Automobile aside: Even before the oil embargo, in 1970, Nixon proclaimed in an environmental message to Congress: "I am inaugurating a program to marshal both government and private research with the goal of producing an unconventionally powered virtually pollution free automobile within five years.")
President Gerald Ford moved the date for achieving American energy independence back to 1985. (Auto Aside: Ford signed the 1975 Energy Policy and Conservation Act, which set federal standards for energy efficiency in new cars for the first time.)
President Jimmy Carter made energy policy the centerpiece of his administration. He notoriously declared on April 18, 1977, that achieving energy independence was the "moral equivalent of war." In August of that year, Carter signed the law creating the United States Department of Energy, intended to manage America's energy crisis.
In late 1978, the beginning of the Iranian revolution caused a shortfall in oil exports, and prices doubled over the next couple of years. Carter, wearing a sweater on national television, urged Americans to turn down their thermostats. "Beginning this moment, this nation will never use more foreign oil than we did in 1977--never," Carter declared in his nationally televised speech on July 15, 1979.
He proposed a sweeping $142 billion energy plan which would achieve energy independence by 1990. Part of his plan included the "creation of this nation's first solar bank, which will help us achieve the crucial goal of 20 percent of our energy coming from solar power by the year 2000." Carter imposed an import quota of 8.5 million barrels of oil per day and created the $20 billion Synfuels program, which was supposed to produce 2.5 million barrels of synthetic fuels per day by 1990. To his credit, Carter did begin to dismantle Nixon's crude oil price controls. (Auto aside: In his 1979 speech Carter warned: Citizens who insist on driving large, unnecessarily powerful cars must expect to pay more for that luxury.)
In 1991, in the prelude to the First Gulf War, President George H.W. Bush announced a hodgepodge of proposals as a national energy strategy. Naturally one of his strategy's guiding principles was "reducing our dependence on foreign oil." (Auto aside: President Bush, meeting with representatives of the "Big Three" automakers, announced a jointly funded U.S. Advanced Battery Consortium--a $260 million research project to develop lightweight battery system for electric vehicles.)
In 1992, President Bill Clinton proposed a BTU tax on fossil fuels to raise money to reduce the deficit. Clinton's tax proposal would have put a levy on natural gas, coal, and nuclear power of 25.7 cents per million British thermal units. Crude oil would have been taxed at 59.9 cents per million BTU to discourage dependence on foreign oil. The crude oil BTU tax would have raised the price of a barrel of oil by about $3.50, and would have cost the average family between $200 to $400 annually. In 1996, Clinton proposed a comprehensive energy plan that was completely ignored by the Republican-controlled Congress. (Auto aside: In 1993, Clinton launched the $1 billion Partnership for New Generation Vehicles with the Big Three automakers, aiming to produce a prototype car that was three times more fuel efficient than conventional vehicles by 2004.)
California experienced a series of rolling blackouts in the first months of George W. Bush's administration. A national energy task force led by Vice President Dick Cheney notoriously devised a national energy policy, released in May 2001. The task force described America's energy situation in stark terms: "America in the year 2001 faces the most serious energy shortage since the oil embargoes of the 1970s. . . . A fundamental imbalance between supply and demand defines our nation's energy crisis."
"What people need to hear loud and clear is that we're running out of energy in America," said Bush in May 2001. "We can do a better job in conservation, but we darn sure have to do a better job of finding more supply." He added, "We can't conserve our way to energy independence."
Nevertheless, George W. Bush repeated recent presidential history by insisting, in his 2003 State of the Union address, that one of his administration's goals was "to promote energy independence for our country." (Auto aside: In that speech, Bush announced his $1.2 billion FreedomCar proposal to develop hydrogen fueled vehicles.)
John Kerry, the presumed Democratic presidential candidate, says he too has a plan for energy independence. "It's time to make energy independence a national priority--and to put in place a plan that frees our nation from the grip of Mideast oil in the next ten years," he intones in a campaign ad.
Among other things, Kerry would retool Gerry Ford's automotive fuel economy standards by raising them to as high as 36 miles per gallon. He would also require that 20 percent of electricity generation come from renewable energy sources by 2020--reminiscent of Carter's bold 1980 plan to supply 20 percent of America's energy by 2000 using solar energy. (Kerry's plan would also doubtless utterly fail to meet its goal, as with Carter's plan and all the other bits of energy planning political hubris mentioned in this article.)
So, is there any real difference between Bush and Kerry on energy policy? Not really. "Both believe that at the end of the policy rainbow is energy independence, and they are willing to move heaven and earth to get there. Both are convinced we need government intervention in energy markets," said Jerry Taylor, the Cato Institute's director of natural resource studies, in the Washington Post. "The difference is emphasis, not policy."
Bush and Kerry should take a lesson from the one president who refused to meddle extensively in energy markets--Ronald Reagan. In January 1981, on the day he became president, Reagan ended the remaining federal regulations on domestic oil supplies and prices, allowing oil prices for the first time since 1971 to fall and rise with world market levels. In December 1985, Reagan signed legislation dismantling the U.S. Synthetic Fuels Corp. What happened when all these government attempts to manage our energy supply were cruelly killed? Oil prices dropped from their peak of $37 per barrel in 1981 to less than $14 per barrel in 1986.
Reagan understood that for most Americans lower gasoline prices and lower home electric bills are all the energy independence they want or need.
Ronald Bailey is Reason's science correspondent. His new book, Liberation Biology: A Moral and Scientific Defense of the Biotech Revolution will be published in early 2005.

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PYONGYANG WATCH
North Korea: And still they starve
By Aidan Foster-Carter
What's news? In my country, apparently, it's the rutting of three unmarried people who work - or did - for England's Football Association. (FA for short, perhaps appropriately.)
Not that such trivia wholly blots out the real world. As ever, crises come and go. Darfur in Sudan is currently the new flavor of the month, and rightly so. But our attention spans are short, and the media circus will soon move on to horrors new. Darfur may still fester, but it will be off our television screens. As TS Eliot said, "Humankind cannot bear very much reality." (So-called "reality TV" is, of course, the exact opposite: arch navel-gazing narcissism.)
After almost a decade, hungry North Koreans are no longer news. But they're still there, and still hungry. On Monday the official Korean Central News Agency (KCNA) reported the latest in what seems an annual weather onslaught: usually floods, but sometimes drought.
According to KCNA, the July rains have flooded at least 100,000 hectares of fields, and made 1,000 families homeless. Harvests in affected areas are expected to fall by at least 30%. Roads and railways have also been hit in the center and south of the country.
No specific places were named, so maybe this is a nationwide roundup. The figure for homelessness could be worse, but 100,000 hectares is almost 4% of North Korea's total arable land.
Moscow sends wheat
All of which makes new grain just in from Moscow all the more timely. Also on Monday, but seemingly before this latest flood news (which went unmentioned), the United Nations (UN) World Food Program (WFP) praised its first donation ever from Russia. On Sunday the ship MV Kallisto (Greek for "most beautiful", if memory serves) began discharging 34,700 tonnes of wheat, worth US$10 million, at Nampo, the port for Pyongyang. Moscow had long been a, indeed the, major all-around aid donor to North Korea, mainly in the Soviet era. But this seems to be the first time it has chosen to channel food aid multilaterally.
A week earlier, the other power that sundered Korea in 1945 chipped in too. On July 23 the United States said it would give 50,000 tonnes of grain to WFP. That's a lot less than the 100,000 tonnes it gave last year, let alone the 200,000 tonnes in 2002. Ironically, axis of evil or no, US President George W Bush has kept feeding North Korean leader Kim Jong-il. The politics of US farm support plays a part here; plus, as now, the timing is usually political. Bizarrely, the Democratic People's Republic of Korea was at one point the top recipient of US food aid in Asia: since 1996 it has received something more than 2 million tonnes.
Yet it isn't enough. As other calls have arisen - Afghanistan, Iraq, Darfur - while Kim Jong-il prefers guns (nay, nukes) to butter, donor fatigue has set in. Initially WFP saw its appeals for North Korea almost fully met - although other agencies, like the United Nations Children's Fund (UNICEF), have all along had difficulties securing funding for their far more modest budgets in North Korea.
Donor fatigue
Now WFP is feeling the pinch too. Having appealed for 484,000 tonnes this year to feed 6.5 million of North Korea's most vulnerable - that's almost 30% of the population - with 2004 more than half over, it has received confirmed pledges for just 125,000 tonnes.
I should rephrase that. When aid dries up, it's hungry North Koreans who feel the pinch. For the past two years, falling donations have forced WFP to halt crucial supplemental rations to millions of designated recipients for long periods. In June and July just gone, over 2 million core beneficiaries, including many young children, pregnant women and nursing mothers, went without cereal rations. Thanks to Russia, these can now resume.
But 300,000 elderly people will still have to go without. Nor will the new aid last long. WFP's country director, Richard Ragan, warns that there is "little aid in the pipeline for the latter months of the year ... We urgently need firm commitments to plug that gap."
Some aid comes through other channels. South Korea is giving (lending, in theory) its usual 400,000 tonnes of rice; Seoul may buy some from Vietnam, as part of last week's deal on South Korea's receiving the North's refugees via Vietnam. Some southern rice has already been delivered - overland, which is a first. Japan, once a major donor, will give rice worth $10 million now that Pyongyang has let the children of Japanese abductees leave (though Washington purports to deny any linkage.)
Barely surviving
Still, and though the acute famine of the late 1990s has passed, many North Koreans are barely surviving. Here's what counts as progress in Kim Jong-il's 21st century people's paradise. Whereas a 1998 survey found 60% of children suffering acute malnutrition, by 2002 "only" 40% were so afflicted. Even this gain may be eroded, if food doesn't come.
Adults suffer too. According to WFP, "much of the population is afflicted by critical dietary deficiencies, consuming very little protein, fat and micronutrients." In a country two-thirds urban - yes, North Korea had an industrial revolution, once, before they blew it - the worst-off are city-dwellers outside Pyongyang, the relatively privileged capital.
These people rely on what is left of the Public Distribution System (PDS), the old state rationing system. Once comprehensive, the PDS now provides just 300 grams a day, less than half a survival ration. WFP adds that 70% of households dependent on PDS can't get the daily calories they need.
Meaning, presumably, that they can't afford to supplement this from the private markets that have sprung up in the past two years to bridge the gap - if they could afford them to begin with. Ironically, if typical of transition economies, the belated slow dawning of economic sense in North Korea since mid-2002 has aggravated unequal access to food. Though essential, market principles are no instant panacea; indeed, they create new divisions and vulnerabilities.
Defectors: What aid?
What to do? The humane urge to help - and I do urge you to help - then stumbles on the likes of Lee Kum-kwan, who fled North Korea in 2002 and now works for a South Korean religious group helping North Koreans in China. Lee told the Korea Times on Monday that his first taste of South Korean ramyon noodles was as a security policeman in Pyongyang. Before that, "I'd never heard of or seen international aid, not to mention South Korean food aid. Most North Koreans would be the same."
More privileged still than noodle-eating police, said Lee, 28, were the guys right next door: Kim Jong-il's guard corps, "the most powerful military unit in the North, whose soldiers are only allowed to eat rice". Lee claims that most of the North's national budget and international aid is funneled to Kim's guards - and also that German beef aid was taken back after being handed out, as soon as international monitors were out of sight.
The latter, he admits, is hearsay from an aunt. Even if some such tales are exaggerated, anyone aiding North Korea must do so in full knowledge of some unpalatable truths.
First, all this suffering is the fault of a vicious and obtuse regime. In 2004, Kim Jong-il still chooses guns over butter. Under the Songun (army-first) policy, the military gets the lion's share of resources; the civilian economy just gets the crumbs. Nukes don't come cheap. They also have a huge opportunity cost - meaning aid and investment forgone, or which would flow in if only the Dear Leader Kim Jong-il followed Colonel Muammar Gaddafi and saw the light.
Second, it was lousy policy that created the famine. Even floods aren't just an act of God. Reckless terracing of steep hills caused deforestation and erosion, increasing vulnerability to floods and loss of cropland. Third, whether or not actual food aid is diverted, North Korea obviously is free to send more of its own rice - or that of donors who don't ask awkward questions, like China and South Korea - to the military. To that extent, the diversion debate is a bit of a red herring.
So what to do? To me, the humanitarian imperative - feed my sheep, to coin a phrase - is still paramount. WFP, and the many non-governmental organizations active in North Korea, indubitably save lives. Hopefully, too, they are winning hearts and minds, showing that not all foreigners are the imperialist devils of Pyongyang propaganda.
Indeed, while their own so-called "great leaders" inflicted famine, it was and is foreigners who mainly helped. One day, North Koreans will know this. That should be interesting.
Aidan Foster-Carter is honorary senior research fellow in sociology and modern Korea, Leeds University, England.
(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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South Korea's perilous historical revisionism
By David Scofield
Once upon a time, South Korean schoolchildren were taught to draw North Koreans as pigs and wolves, ravening beasts, the "main enemy". Today, however, South Korea makes nice in a kinder, gentler, misguided policy of historical revisionism, reconciliation and engagement. After all, the North Koreans are misunderstood brethren. The real enemies are the United States and Japan.
Now South Korea describes the 468 North Korean refugees who arrive last week as those who escaped economic hardship. South Korea harasses North Korean exiles and dissidents who try to run a radio station telling the truth about the North. It stifles talk of North Korean gulags, and its menacing intelligence agents tell defectors who want to talk about Pyongyang's deadly chemical experiments to keep their mouths shut.
South Korea's policies of engagement with North Korea are predicated on the belief that modifying the perceptions and identities held by the people of South Korea, officially softening how a former aggressor is described and depicted throughout society, will mitigate animosity and, the theory goes, ultimately prompt North Korea similarly to change its views of the South.
It appears very altruistic and humane, but it does leave one important question unanswered. What if the other side doesn't change its views or moderate its stance? What if one side lowers its guard, engages the other as an equal partner and not as a belligerent, but the other side remains hostile? Portraying Pyongyang as an insecure brother, a misunderstood weaker sibling that only needs the right reassurances and enticements to break its half-century of hostility and jingoism toward the South, is a high-stakes gamble. If North Korea does not moderate its perceptions and depictions of its neighbor to the south - and there's precious little evidence that it will - then North Korea will hold a strategic advantage against the overly pliant South - the tail wagging the dog.
In fact, North Korea, which condemned South Korea's admission of the refugee/defectors, has canceled Tuesday's working-level talks on defusing the North's nuclear-weapons programs. It was the third cancellation of the working-level group involving both North and South Korea, China, Japan, Russia and the US. It was to be hosted by China.
The changes that Kim Dae-jung's Sunshine Policy and Roh Moo-hyun's Peace and Prosperity Program have made to South Korean society are nothing short of monumental. Prior to Kim's election, the North was widely regarded as dangerous and threatening, an unmitigated evil to those who monitored its human-rights abuses and the famine of the mid- to late 1990s, caused by misguided political ideology. Indeed, some members of President Roh Moo-hyun's affiliated party, OOP (Our Open Party), are protesting the passing of the censorious North Korean Human Rights Act in the US House of Representatives; they hope to get between 80-90 lawmakers' signatures on a protest letter to the US Senate, demanding senators quash the bill.
Now, North Korean refugees, like the 468 who arrived last week in Seoul via Vietnam, are not heralded as survivors of a tyrannical regime, but rather as defectors escaping economic hardship - privations that many South Koreans believe are a direct result of US policies toward the North, not North Korean leader Kim Jong-il's callous disregard for human life. Reasoned discussion of the true political cause of the horrors in the North generally, and analysis of these most recent newcomers specifically, is preempted. The South Korean media and the government have largely abandoned the issue, leaving questions of state persecution and the reasons behind the absence of men in this latest exodus - 90 were women and children - unanswered.
Nor does South Korea's engagement policy encourage discussion of North Korea's gulags, or its illicit trade in human labor, drugs, weapons and counterfeit currency. On July 28, BBC 2 in the United Kingdom ran interviews with two North Korean defectors in Seoul who claim to have first-hand knowledge of human experiments within the North's gulags. One defector, referred to in the piece as Dr Kim, offered the name of the compound used in experiments on North Korean civilians as para-cyano-nitrobenzene, or NP-100. The cyanide-based chemical was being developed for possible use on military and civilian targets in South Korea. Both Dr Kim and a previous defector who came forward with similar testimony in January, Kwon Hyok, declared that they are constantly harassed and threatened by South Korean intelligence services to keep their knowledge to themselves, stories of gas chambers and gulags in the North being less than congruent with South Korea's official depiction of North Korea.
The military too sees a kinder, gentler Pyongyang
Within the South 's military as well, the removal of the designation "main enemy" from South Korea's defense White Paper due to be released this October alters the defense dynamic considerably. The North, long defined as the primary threat or "main enemy" of the South, has now been redefined in line with the policy of softening the nation's collective perception of the North. The result, exemplified by recent Northern Limit Line (NLL, the sea border between North and South Korea) incursions, is a military command reflecting little faith in the government's commitment to defend the South against Northern aggression.
On July 14, a North Korean patrol boat - the same boat that crossed the naval boundary in 2002 and attacked a South Korean naval vessel, killing six sailors - crossed into South Korean territorial waters. South Korean naval forces responded by firing warning shots across the vessel's bow. The North Korean ship retreated, but its navy later protested, saying it had utilized the newly designated radio frequency (a radio "hotline" agreed to in general-level talks between the North and South in late May) to contact the South Korean navy and inform it of the transgression. Of course it did not make the call until it had already crossed the line, but nonetheless the South Korean navy was now in the hot seat.
What emerged from the inquiry and the subsequent resignations of naval Vice Admiral Kim Seong-man and Defense Minister Cho Young-kil is a picture of a navy that feared informing political superiors of the radio transmission for fear they would be ordered to hold their fire. Indeed, North Korean ships have violated the NLL five times since agreeing to use the specified frequency and protocols, a 500% increase over the average of one incursion per month before the communications agreement. What was to have been a step forward for intra-Korean relations may actually be a new strategy to weaken Southern defenses as Northern ships violate the border then send messages effectively preempting a response from the South: a strategy that would buy the Northern side precious time during a preemptive assault, by ensuring hesitation on the part of the South in responding.
The same such strategy may well be tested against South Korean ground defenses along the Demilitarized Zone (DMZ) after US forces are redeployed from the area at the end of next year. As for the South Korean field officers and the defense forces they manage, it's hard to imagine how they will maintain a seamless defense against the North when senior command members and rank-and-file soldiers are conditioned not to see an enemy in the North. In the immediate aftermath of the deadly attack by North Korea's navy two years ago, a surviving sailor was quoted as saying, "We didn't believe the North would attack us."
Schoolchildren once demonized the North
The pro-North indoctrination of the South Korea's younger generation comes in the form of school curriculum. The previous Kim Dae-jung administration began "updating" the way the texts describe the North, and indeed such a measure was long overdue. South Koreans in their 30s and older tell of being instructed to draw North Koreans as pigs and wolves in primary school. These state-sanctioned activities demonized the North Korean people as a whole, making no distinction between the North Korean people and their despotic leadership.
But today's policies promote wholesale perception change, not a considered, reasoned update of Cold War propaganda. The evil of the North Korean regime has been mitigated; the nation's pampered ruling elite and the starving huddled masses are again one and the same from a policy perspective, and this is not a temporary phenomenon. Most analysts believe that even if the present "progressive" government in Seoul were replaced with a conservative one, there would be little change in the policy. Grand National Party (GNP) leader Park Gun-hye went to visit the North Korean leader before the last election. This move was believed by many to be designed to assure North Korea that the current policies of engagement started by Kim Dae-jung would continue regardless of the person occupying in the Blue House.
South Korean policies of engagement have been successful in changing how South Koreans view the North. Most South Koreans no longer view the North as the primary threat to their security. That designation is increasingly reserved for the United States. These policies of rapprochement have successfully tapped into South Korea's inherent "one blood, one people" view of the world. Teaching graduate students in South Korea, this correspondent was often struck by how deep this blood affiliation goes, as students majoring in NGO (non-governmental organization) development - many self-described human-rights activists - would challenge evidence of atrocities committed by the Northern regime. Students would often assert in so many words: "Prove there are people starving and being tortured, there is no proof ... it's all a campaign by the United States and Japan to demonize the North and weaken Korea."
Politically prickly issues from South Korea's recent past have a history of being buried or politically manipulated, leaving rumors and animosity to fester as a true accounting of events and the reconciliation that should accompany it proves elusive. Perhaps then it's not surprising that many policy architects in the South believe that North-South reconciliation can be achieved while turning a blind eye to the callous indifference to human life so often demonstrated by the leadership in North Korea. But at some point the South will have to answer for its myopia, its refusal even to raise the issue with the North or include the well-documented proof of crimes against humanity in the administration's dialogue with the people. A North-South relationship predicated on denial and half-truths is unlikely to bring lasting peace and stability.
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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No bed of roses for refugees in South
By Ahn Mi-young
SEOUL - "False expectations - that's how I put my life in South Korea, now," said North Korean defector Lee Min-sun, who works in a restaurant here. "It's like a marriage to a lover who makes false promises," recalled Lee (asking that her real name not be used), who made her way to South Korea in 2001.
Admitting that North Korean refugees - more than 460 last week - may have been a humanitarian act, but it was cloaked in secrecy lest the North be offended - and it was. It could have adverse consequences for the six-party talks aimed at defusing the North Korean nuclear crisis. North Korea has already denounced South Korea's "terrorist" crime in admitting the refugees/defectors and said Seoul would bear the consequences. And it said it would not attend talks in Beijing this week involving both Koreas, China, Japan, Russia and the United States.
Meanwhile, it's tough for the North Koreans living in the South. The cultural adjustment to a capitalist society is a shock, many are unemployed, and many say they are discriminated against by their Southern brethren.
"It started with a sweetheart who promised a decent house with a fountain spring. But in reality the lover could only give me a hut without even a bathtub," said Lee, 35. "Life's so hard in South. I'm discriminated against because I'm from the North and I can't even get a decent job."
Adapting to life in the capitalist South is a challenge for North Korean refugees. Their difficulties, however, may pale against Seoul's task of balancing its delicate regional diplomacy - warming to North Korea and encouraging it to reciprocate, while not offending Pyongyang by publicizing the 460 refugees who made their way to Seoul last week. They came from an unidentified Southeast Asian country believed to be Vietnam.
North Korea already has accused the South of committing "a terrorist crime" for granting asylum to the North Koreans. Seoul has cloaked the exodus in secrecy partly to avoid provoking Pyongyang.
"South Korea will be held responsible for the aftermath of the operation, and all forces that cooperated with it will pay a high price," the South's Yonhap news agency quoted the North Korean Committee for the Peaceful Reunification of the Fatherland as saying.
For South Korean and Western activists, the suffering of North Koreans in their famine-stricken communist country justifies the dicey diplomacy on the Korean Peninsula.
Seoul fears exodus could mean Pyongyang's collapse
But the South Korean government has a different set of concerns. Topping Seoul's fears are that an exodus of defectors will spark a chaotic Albanian-style collapse of North Korea, bringing hungry refugees southward by the millions.
"We obviously want to take them for humanitarian reasons, but we can't overly or unnecessarily provoke North Korea," a senior South Korean official said.
For Lee, the escape to South Korea began at the Tumen River at the North Korea-China border. She bribed border guards to allow her to cross into China and then paid a contact to take her to the South Korean Embassy in Beijing, where she sought asylum. She then flew to Seoul.
Lee's dramatic journey is typical of the more than 5,000 North Koreans who have risked their lives to reach capitalist South Korea since the Korean War ended in 1953.
North Koreans have defected in growing numbers over the past decade, fleeing poverty and oppression. Most have escaped across the country's long and porous border with China rather than the more heavily fortified frontier with South Korea. However, China, a North Korean ally, has refused to accept them as refugees and the defectors risk being sent back home if caught by Chinese authorities. China doesn't want a flood of poor refugees fleeing into its territory.
But the promise of better life outside tightly sealed communist North Korea isn't always the hoped-for bed of roses.
Having lived in a country where they have little personal freedom, the transition for North Koreans can be overwhelming. One of the biggest problems is unemployment. As many as 50% of defectors have no job, or only part-time work. Many quit their jobs, unable to cope with the competitive atmosphere in the workplace, says Chung Sung-im, a researcher at the Center for North Korean Studies at the Seoul-based Sejong Institute.
"Of the 5,000 or so North Koreans in South Korea, some are leading good lives as successful businessmen, entertainers or journalists," Chung said. "But there are many North Koreans in the South who are struggling to cope with the harsh realities in the capitalist world that seem to confound them."
Capitalist culture shock and discrimination
Chung said many of the refugees feel they are being treated as second-class citizens and also suffer from culture shock.
Kim Mi-ran (not her real name) was a herbalist in North Korea, when she defected to the South in 2001. She was lucky enough to get a job as an herbalist in a small town in her adopted home. But Kim, 37, feels her clients treat her differently when they discover she's from the North.
"I feel miserable when my clients cancel their appointments or switch to another herbalist when they find out I'm from North Korea," she said.
Joon Soon-young remembers the difficult transition she faced when she left North Korea in January 2003. Joon was an actress in Pyongyang and is now a restaurant owner in Seoul, employing with 15 North Korean defectors as workers.
"Of course, I have never regretted leaving the North; and I appreciate the attention and financial support I've received, both from the government and by private donors," she said in an interview. "Despite all the hardship that I have got through, the bottom line is that South Korea is still a better place to live.
"I did not give up. I rose again, and now I love what I am doing. You have to endure hardship if you want to win here," said the former actress. "I had a dream to be free and I wanted it to work."
Last week's cooperation among nations to enable the refugees to reach Seoul has been hailed as a sign that Asian countries are starting to address the defector issue after years of inaction. But the intense secrecy surrounding the operation - Hanoi refused to acknowledge its role and Seoul would not confirm the defectors' arrival - showed regional sensitivities to the issue.
"The massive arrival of Northern defectors is generally expected to compound (and complicate) a peaceful resolution to the nuclear standoff between Pyongyang and Washington, which has kept the Korean Peninsula in the grip of tension since October 2002," said a July 31 editorial in the Korea Times daily newspaper.

(Inter Press Service)

Report: Pakistan's ISI 'Fully Involved' in 9/11
Arnaud de Borchgrave
Tuesday, Aug. 3, 2004
The Sept. 11 Commission has found troubling new evidence that Iran was closer to al-Qaida than was Iraq. More importantly, and through no fault of its own, the commission missed the biggest prize of all: Former Pakistani intelligence officers knew beforehand all about the September 11 attacks.
They even advised Osama bin Laden and his cohorts how to attack key targets in the United States with hijacked civilian aircraft. And bin Laden has been undergoing periodic dialysis treatment in a military hospital in Peshawar, capital of Pakistan's Northwest Frontier Province adjacent to the Afghan border.
The information came to the commission's attention in a confidential report from Pakistan as the commission's own report was coming off the presses. The information was supplied with the understanding that the unimpeachable source would remain anonymous.
Pakistan still denies that President Pervez Musharraf knew anything about the activities of A.Q. Khan, the country's top nuclear engineer who spent the last 10 years building and running a one-stop global Wal-Mart for "rogue" nations. North Korea, Iran and Libya shopped for nuclear weapons at Mr. Khan's underground black market. Pakistan has also denied the allegations by a leading Pakistani in the confidential addendum to the September 11 Commission report.
After U.S. and British intelligence painstakingly pieced together Mr. Khan's global nuclear proliferation endeavors, Deputy Secretary of State Rich Armitage was assigned last fall to convey the devastating news to Mr. Musharraf. Mr. Khan, a national icon for giving Pakistan its nuclear arsenal, was not arrested. Instead, Mr. Musharraf pardoned him in exchange for an abject apology on national television in English.
No one in Pakistan believed Mr. Musharraf's claim he was totally in the dark about Mr. Khan's operation. Prior to seizing power in 1999, Mr. Musharraf was -- and still is -- army chief of staff. For the past five years, Pakistan's Inter-Services Intelligence chief has reported directly to Mr. Musharraf.
Osama bin Laden's principal Pakistani adviser before Sept. 11, 2001, was retired Gen. Hamid Gul, a former ISI chief who, since the 2001 attacks, is "strategic adviser" to the coalition of six politico-religious parties that governs two of Pakistan's four provinces. Known as MMA, the coalition also occupies 20 percent of the seats in the federal assembly in Islamabad.
Hours after Sept. 11, Gen. Gul publicly accused Israel's Mossad of fomenting the plot. Later, he said the U.S. Air Force must have been in on it since no warplanes were scrambled to shoot down the hijacked airliners.
Gen. Gul spent two weeks in Afghanistan immediately before Sept. 11. He denied meeting bin Laden on that trip, but has always said he was an "admirer" of the al-Qaida leader. However, he did meet several times with Mullah Mohammed Omar, the Taliban leader.
Since Sept. 11, hardly a week goes by without Gen. Gul denouncing the United States in both the Urdu and English-language media.
In a conversation with this reporter in October 2001, Gen. Gul forecast a future Islamist nuclear power that would form a greater Islamic state with a fundamentalist Saudi Arabia after the monarchy falls.
Gen. Gul worked closely with the CIA during the Soviet occupation of Afghanistan when he was ISI chief. He was "mildly" fundamentalist in those days, he explained after Sept. 11, and indifferent to the United States. But he became passionately anti-American after the United States turned its back on Afghanistan following the 1989 Soviet withdrawal and began punishing Pakistan with economic and military sanctions for its secret nuclear buildup.
A ranking CIA official, speaking anonymously, said the agency considered Gen. Gul "the most dangerous man" in Pakistan. A senior Pakistani political leader, also on condition of anonymity, said, "I have reason to believe Hamid Gul was Osama bin Laden's master planner."
The report received by the Sept. 11 Commission from the anonymous, well-connected Pakistani source, said: "The core issue of instability and violence in South Asia is the character, activities and persistence of the militarized Islamist fundamentalist state in Pakistan. No cure for this canker can be arrived at through any strategy of negotiations, support and financial aid to the military regime, or by a 'regulated' transition to 'democracy.'"
The confidential report continued: "The imprints of every major act of international Islamist terrorism invariably passes through Pakistan, right from September 11 -- where virtually all the participants had trained, resided or met in, coordinated with, or received funding from or through Pakistan -- to major acts of terrorism across South Asia and Southeast Asia, as well as major networks of terror that have been discovered in Europe.
"Pakistan has harvested an enormous price for its apparent 'cooperation' with the U.S., and in this it has combined deception and blackmail -- including nuclear blackmail -- to secure a continuous stream of concessions. Its conduct is little different from that of North Korea, which has in the past chosen the nuclear path to secure incremental aid from Western donors. A pattern of sustained nuclear blackmail has consistently been at the heart of Pakistan's case for concessions, aid and a heightened threshold of international tolerance for its sponsorship and support of Islamist terrorism.
"To understand how this works, it is useful to conceive of Pakistan's ISI as a state acting as terrorist traffickers, complaining that, if it does not receive the extraordinary dispensations and indulgences that it seeks, it will, in effect, 'implode,' and in the process do extraordinary harm.
"Part of the threat of this 'explosion' is also the specter of the transfer of its nuclear arsenal and capabilities to more intransigent and irrational elements of the Islamist far right in Pakistan, who would not be amenable to the logic that its present rulers -- whose interests in terrorism are strategic, and consequently, subject to considerations of strategic advantage -- are willing to listen to. ...
"It is crucial to note that if the Islamist terrorist groups gain access to nuclear devices, ISI will almost certainly be the source. ... At least six Pakistani scientists connected with the country's nuclear program were in contact with al-Qaida and Osama bin Laden with the thorough instructions of ISI.
"Pakistan has projected the electoral victory of the fundamentalist and pro-Taliban, pro-al Qaeda Muttahida Majlis-e-Amal (MMA) in the November elections as 'proof' the military is the only 'barrier' against the country passing into the hands of the extremists. The fact, however, is that the elections were widely rigged, and this was a fact acknowledged by the European Union observers, as well as by some of the MMA's constituents themselves. The MMA victory was, in fact, substantially engineered by the Musharraf regime, as are the various anti-U.S. 'mass demonstrations' around the country.
"Pakistan has made a big case out of the fact that some of the top-line leadership of al Qaeda has been arrested in the country with the 'cooperation' of the Pakistani security forces and intelligence. However, the fact is that each such arrest only took place after the FBI and U.S. investigators had effectively gathered evidence to force Pakistani collaboration, but little of this evidence had come from Pakistani intelligence agencies. Indeed, ISI has consistently sought to deny the presence of al Qaeda elements in Pakistan, and to mislead U.S. investigators. ... This deception has been at the very highest level, and Musharraf himself, for instance, initially insisted he was 'certain' bin Laden was dead. ...
"ISI has been actively facilitating the relocation of the al Qaeda from Afghanistan to Pakistan, and the conspiracy of substantial segments of serving Army and intelligence officers is visible. ..."
"The Pakistan army consistently denies giving the militants anything more than moral, diplomatic and political support. The reality is quite different. ISI issues money and directions to militant groups, specially the Arab hijackers of September 11 from al Qaeda. ISI was fully involved in devising and helping the entire affair. And that is why people like Hamid Gul and others very quickly stated the propaganda that CIA and Mossad did it. ..."
"The dilemma for Musharraf is that many of his army officers are still deeply sympathetic to al Qaeda, Taliban militants and the Kashmir cause. ... Many retired and present ISI officers retain close links to al Qaeda militants hiding in various state-sponsored places in Pakistan and Kashmir as well as leaders from the defeated Taliban regime. They regard the fight against Americans and Jews and Indians in different parts of the world as legitimate jihad."
The report also says, "According to a senior tribal leader in Peshawar, bin Laden, who suffers from renal deficiency, has been periodically undergoing dialysis in a Peshawar military hospital with the knowledge and approval of ISI if not of Gen. Pervez Musharraf himself."
The same source, though not in the report, speculated that Mr. Musharraf may plan to turn over bin Laden to President Bush in time to clinch Mr. Bush's re-election in November.
Arnaud de Borchgrave is editor at large for The Washington Times and for United Press International.



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Tashkent Terrorists
The al Qaeda allies behind the attacks.
By Andrew Apostolou
The terrorist attacks in Tashkent, the capital of Uzbekistan, on Friday are a testament to the continued vitality of the al Qaeda movement. Three suicide-bomb blasts outside the embassies of Israel and the U.S. and the office of the Uzbek state prosecutor killed three terrorists and three innocent Uzbeks. Responsibility for the attacks has been claimed by the Jihad Islamic Group (JIG), a successor to the Islamic Movement of Uzbekistan (IMU), an organization allied with al Qaeda. The JIG is also known as "Jamoat" (meaning "societies" or "groups" in Uzbek).
The IMU was probably behind car bombs in Tashkent in February 1999 that aimed to assassinate Uzbek President Islam Karimov and that killed 16 persons. In its new guise as Jamoat, the organization issued a statement in April 2004 claiming responsibility for a series of explosions from March 28 to April 1, 2004 that took the lives of 33 terrorists and 14 bystanders and policemen. The trial of 15 suspects from the March and April bombings began on July 26.
The IMU and its successor are a classic example of how the al Qaeda movement formed and then spread its tentacles from its Afghan base. Islamists gravitated towards al Qaeda, which provided funding and training, fought with the Taliban and now have returned to fight their jihad at home.
The history of the IMU began, like that of al Qaeda, with the defeat of Communism. The Soviet republics of Central Asia, in particular Uzbekistan, missed the wave of democratization that swept Eastern Europe and the western republics of the Soviet Union in 1989 and 1991. Instead, the old corrupt Communist-party bosses and their acolytes, men like President Islam Karimov who has run the country since 1989, clung to power.
Attempts to oppose the Communist party by secular groups were crushed. At the same time, small Islamist groups appeared in eastern Uzbekistan. Islam had largely been destroyed by the Communist dictatorship. Most mosques were closed and Uzbeks were largely ignorant of the basic practices of Islam. The radicals had little knowledge of Islam, but claimed to have easy answers to the economic and social crises that accompanied the collapse of Communism and the brutal ethnic unrest then sweeping eastern Uzbekistan.
While the Uzbek authorities successfully closed down the Islamist groups, many of their members fled to the neighboring former Soviet republic of Tajikistan. Some of these Uzbek Islamists participated in the Tajik civil war (1992-1997) on the side of an unusual alliance of Tajik Islamists and secular anti-Communists that fought against the former Communist government of Tajikistan. For most of these years, the Uzbek Islamists were based either in remote mountainous regions of Tajikistan or in northern Afghanistan.
When the Tajik civil war ended in 1997, the Uzbek Islamists found themselves at a loose end. Their Tajik allies signed a peace deal with their former opponents and went into government in Tajikistan. The Uzbek Islamists refused to lay down their arms. Instead, they threw in their lot with the new, dominant force in Afghanistan, the Taliban and their Saudi exile friend, Osama bin Laden.
Al Qaeda and the Taliban, who dreamt of establishing their rule in the historic centers of Islam in Uzbekistan, the cities of Samarkand and Bukhara, gave the IMU bases and training. The connection soon bore fruit. The first attacks linked to the IMU were five synchronized car bombs in Tashkent on February 16, 1999. The bombings, which were similar to the attacks on the U.S. embassies in East Africa in August 1998, had all the hallmarks of al Qaeda training.
It was only in May 1999 that the IMU formally announced its existence, broadcasting its manifesto on Iranian radio. The IMU charter advocates an Islamic state along the lines of the Islamic republic of Iran, with nominal participation by the population closely supervised by clerics. The declaration was replete with attacks on the U.S. and anti-Semitism, claiming, for example, that President Karimov of Uzbekistan is a Jew.
The IMU's jihad was a flop. The militarily incompetent IMU launched a series of crossborder attacks into Uzbekistan in August 1999 and August 2000 that were repulsed. Never more than several hundred strong, the IMU was unable to garner any real support in Uzbekistan where the population is largely secular and uninterested in Islamist politics.
After September 11, most of the IMU went down fighting with the Taliban. The U.S., in need of bases in Central Asia, asked Uzbekistan for access to the Khanabad airbase in southern Uzbekistan near the Afghan border. Although never officially acknowledged by the Uzbek government, U.S. forces flew combat operations from Khanabad and the base was the jumping off point for special forces and CIA teams working with pro-US Afghan forces in the campaign against the Taliban and al Qaeda. A similarly well-guarded secret, until recently, were the Predator surveillance flights from Uzbekistan over Afghanistan in 2000.
The Taliban sent the head of the IMU, Jumaboi Khojiev (who used the nom de guerre Juma Namangani after his hometown of Namagan in eastern Uzbekistan) and his men to defend their northern front in October 2001. Most of the estimated 700 members of the IMU's para-military unit were captured or killed in fighting around Mazar-e Sharif and Konduz in November 2001. Namangani himself, who had fought as a Soviet paratrooper in Afghanistan in 1987-1989, reportedly died of wounds sustained during the fighting.
The remnants of the IMU then fled with their al Qaeda allies to the Afghan-Pakistan border area, emerging in March 2002 to fight U.S. and Afghan forces in the Shah-e Kot valley. Others were killed by Pakistani forces in a series of sweeps of the border areas and a few gave themselves up.
A stubborn rearguard, however, following the pattern of the rest of the al Qaeda movement, has returned home and started to recruit. Despite having been allied to the Taliban, the IMU, in its new guise as the Jamaot, has become ideologically flexible, seeking out unlikely recruits. The two suicide bombers who killed themselves, three policemen and a child in Tashkent on March 29, 2004, were women. One of them, Dilnoza Khalmuradova, was just 19 years old. Yet again, al Qaeda and its trainees have shown themselves to be as adaptable as they are fanatical.
Andrew Apostolou is director of research at the Foundation for the Defense of Democracies a policy institute focusing on terrorism. He has covered Uzbekistan and Central Asia since 1992.
http://www.nationalreview.com/comment/apostolou200408020848.asp


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Minister confirms arrest of IT expert
ISLAMABAD, Aug 2: Minister for Information Sheikh Rashid Ahmad has confirmed that a computer expert linked to a terrorist network has been arrested.
APP quoted Sheikh Rashid as saying that terrorists were being arrested all over the country, adding that they were trying to carry out attacks at various places out of sheer frustration. They would not succeed in their nefarious designs, he added.
AFP ADDS: Sheikh Rashid said: "We've arrested a computer mastermind. He is linked to Al Qaeda. We got information from computer and email." He was ambiguous about the place where the man was arrested and said he was captured either in Lahore or Gujrat and declined to reveal his nationality.
The capture of the computer engineer was around the same time as the arrest of Tanzanian-born Ahmed Khalfan Ghailani, Sheikh Rashid said, but would not specify the date. Ghailani's arrest also yielded valuable information, the minister said.
"After Ghailani, this is the second important arrest in Pakistan," Mr Rashid later told state television. "We have got valuable information from him," he said.
"We have arrested some more people in addition to these two," he said. Sheikh Rashid said that security agencies hoped to penetrate the terrorist network using the information gleaned from the latest detainees.

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Frontier Menace
What are we doing about the terrorists organizing on the Pakistan-Afghanistan border?
BY KATHY GANNON
Tuesday, August 3, 2004 12:01 a.m. EDT
ISLAMABAD--A sign outside the U.S. Embassy in Kabul reads: "The U.S. Embassy would be grateful if any of our friends who have information on terrorist activity or threats inform us between 10 a.m. and 12 p.m. on Sunday through Thursday." Written on a big billboard in English as well as in Afghanistan's official languages, Pashtu and Dari, it stands directly across from the main gates of the embassy, which is encased by giant walls topped with rolls of barbed wire and guarded by sentries in sandbag bunkers.
The sign seems absurd. Is information that could help bring terrorists to justice only welcome during a two-hour time slot on working days? Yet it drives home the difficulty that the U.S. faces in gathering intelligence in countries like Afghanistan, where even non-military Americans have to wear bulletproof clothing and can only travel in massively armed convoys.
That means they can only talk to people handpicked for them, often by hosts who don't always want the whole truth told. It also leads to a heavy reliance on drop-ins--those who can muster the courage to face the overwhelming show of security and knock on the embassy gates, and then only during the right hours. That's true not just in Afghanistan, but also in Pakistan, where unaccompanied journeys by U.S. intelligence personnel are equally unthinkable in the country's tribal regions. Instead, the U.S. embassy in Islamabad--another island surrounded by formidable security--places a significant reliance on drop-ins, according to a CIA official stationed there. Other intelligence is bought, by paying locals in these inhospitable regions to speak out.
The sections of the 9/11 Commission report on Pakistan and Afghanistan reflect this intelligence vacuum. The report states the obvious--that the border regions between Pakistan and Afghanistan, as well as southern and southwestern Afghanistan, are likely places for terrorists to congregate. It also gives the impression that the former Taliban regime gave birth to the isolated terrorist camps in Afghanistan, and the lawless atmosphere that allowed such activities to flourish.
The reality is that these camps predated the Taliban's September 1996 victory, and flourished unhindered when many of those associated with the current U.S.-backed Afghanistan government were last in power. For example, Abdul Rasul Sayyaf, a power-broker in Kabul now aligned to the U.S.-led coalition, requested and received Afghan passports for more than 600 Arabs in 1993-94, while he was a faction leader in the pre-Taliban government.
The sort of company that Mr. Sayyaf keeps was made all too clear at a recent press conference, where Ahmed Shah Ahmedzai, a close ally and former lieutenant in Mr. Sayyaf's Islamic Union, announced his candidacy for president. At that press conference, Mawlawi Mufleh, a radical cleric, denounced the presence of U.S. troops in the country and called for the establishment of an Islamic theocracy stretching from Afghanistan to Morocco.
Another region identified by the 9/11 Commission report as an ideal sanctuary for terrorists is the border region of Afghanistan, Pakistan and Iran. Again, the reality is that the region is a decades-old route used by drugs and weapons smugglers, in addition to would-be terrorists. A former member of the Taliban's security apparatus told me that this region is still being used to move money, mostly originating in Saudi Arabia, to the Taliban and al Qaeda.
He explained how the chain began with the money being given to Afghan businessmen living in Saudi Arabia, who used an informal money-transferring system to move it to Afghan businessmen in Iran. They, in turn, used their business connections to move the money to al Qaeda operatives in Afghanistan. A former member of the Taliban regime said that 1,000 al Qaeda operatives, possibly more, were in the border regions of Afghanistan--accessible from Pakistan--while the Taliban were in power, and are most likely still there. That is information that should have been readily available to U.S. intelligence services before 9/11, and which should have been acted on after the collapse of the Taliban.
Terrorists are also active on the Pakistani side of the border, where they are known to have links with local militants and even intelligence officials. But again there would appear to be an intelligence vacuum as far as the U.S. is concerned. For example, Wana in South Waziristan Agency has been the focus of recent antiterrorist operations. Yet no one of significance has been seen in the area, and only Chechen and Uzbek fighters are believed to be present. It seems the Pakistan military may be using the operation as a cover to tame the tribesmen of that area, rather than actually find and arrest significant members of al Qaeda.
A more logical area to focus on would be the Bajour Agency in northwestern Pakistan, which lies just across the border from Kunar and Nuristan regions in northeastern Afghanistan. Gulbuddin Hekmatyar, the renegade Party of Islam leader wanted by the U.S., is popular in Kunar and Nuristan--where heavily forested mountains make for easy camouflage, and Osama bin Laden was known to have camps before Sept. 11, 2001. While its Pakistani partners keep the U.S.-led coalition busy hundreds of miles to the south, Taliban and al Qaeda move with relative freedom farther north, and in some of Pakistan's most congested cities, including Quetta and Karachi.
The 9/11 Commission report also praises President Bush and Congress "for their efforts in Afghanistan so far." That however deflects from the many problems the country faces. Afghanistan is the world's largest opium-producing country and warlords allied with the government, either directly or indirectly, allow the drugs trade to continue to flourish. The Taliban, soundly defeated in 2001, are becoming increasingly active. Ordinary Afghans, disappointed at the pace of reconstruction, blame the international community for failing to disarm warlords. Many ordinary Afghans and even some in top government posts privately say elections should be postponed until the country has been thoroughly disarmed.
A more productive approach would be to take a hard look at the misplaced support and the allegiances of those the U.S. calls friends in Afghanistan. Why have the private armies controlled by commanders loyal to the Defense Minister Mohammed Fahim not been disarmed? Why has Mr. Fahim refused to hand over his weapons to the central government and been allowed to stymie the development of a national army?
Almost three years after the Taliban fell from power, the gun rules in Afghanistan. President Hamid Karzai made a courageous decision last week when he chose not to include Mr. Fahim as running mate on his presidential ticket. For many, that was the first real sign of Afghanistan trying to break from its violent past. Yet within 24 hours of that announcement, Zalmay Khalilzad, the U.S. ambassador, was meeting with Mr. Fahim, and publicly promising to heal his wounded feelings.
The 9/11 Commission report says, "The United States and the international community should help the Afghan government extend its authority over the country, with a strategy and nation-by-nation commitments to achieve their objectives." The tragedy is that, unless there is a rethink of existing policies and priorities, the opposite is in danger of happening.
Ms. Gannon, who has reported for the Associated Press from Pakistan and Afghanistan for 16 years, is writing a book about Afghanistan.

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An Oil-for-Food Connection?
From the August 9, 2004 issue: On whether any of Saddam's loot made its way into Osama's pockets.
by Claudia Rosett
08/09/2004, Volume 009, Issue 45
IF, as the 9/11 Commission concludes, our "failure of imagination" left America open to the attacks of September 11, then surely some imagination is called for in tackling one of the riddles that stumped the commission: Where exactly did Osama bin Laden get the funding to set up shop in Afghanistan, reach around the globe, and strike the United States?
So let's do some imagining. Unfashionable though it may be, let's even imagine a money trail that connects Saddam Hussein to al Qaeda.
By 1996, remember, bin Laden had been run out of Sudan, and seems to have been out of money. He needed a fresh bundle to rent Afghanistan from the Taliban, train recruits, expand al Qaeda's global network, and launch what eventually became the 9/11 attacks. Meanwhile, over in Iraq about that same time, Saddam Hussein, after a lean stretch under United Nations sanctions, had just cut his Oil-for-Food deal with the U.N., and soon began exploiting that program to embezzle billions meant for relief.
Both Saddam and bin Laden were, in their way, seasoned businessmen. Both had a taste for war. Both hated America. By the late 1990s, Saddam, despite continuing sanctions, was solidly back in business, socking away his purloined billions in secret accounts, but he had no way to attack the United States directly. Bin Laden needed millions to fund al Qaeda, which could then launch a direct strike on the United States. Whatever the differences between Saddam and bin Laden, their circumstances by the late 1990s had all the makings of a deal. Pocket change for Saddam, financial security for bin Laden, and satisfaction for both--death to Americans.
Now let's talk facts. In 1996, Sudan kicked out bin Laden. He went to Afghanistan, arriving there pretty much bankrupt, according to the 9/11 Commission report. His family inheritance was gone, his allowance had been cut off, and Sudan had confiscated his local assets. Yet, just two years later, bin Laden was back on his feet, feeling strong enough to issue a public declaration of war on America. In February 1998, in a London-based Arabic newspaper, Al-Quds al-Arabi, he published his infamous fatwa exhorting Muslims to "kill the Americans and plunder their money." Six months later, in August 1998, al Qaeda finally went ahead with its long-planned bombing of the U.S. embassies in Kenya and Tanzania. Bin Laden was back in the saddle, and over the next three years he shaped al Qaeda into the global monster that finally struck on American soil. His total costs, by the estimates of the 9/11 Commission report, ran to tens of millions of dollars. Even for a terrorist beloved of extremist donors, that's a pretty good chunk of change.
The commission report says bin Laden got his money from sources such as a "core group of financial facilitators" in the Gulf states, especially corrupt charities. But the report concludes: "To date, we have not been able to determine the origin of the money used for the 9/11 attack. Al Qaeda had many sources of funding and a pre-9/11 annual budget estimated at $30 million. If a particular source of funds had dried up, al Qaeda could easily have found enough money elsewhere to fund the attack."
Elsewhere? One obvious "elsewhere" that no one seems to have seriously considered was Saddam's secret geyser of money, gushing from the so-called Oil-for-Food program. That possibility is not discussed in the 9/11 report, and apparently it was not included in the investigation. A 9/11 Commission spokesman confirms that the commission did not request Oil-for-Food documentation from the U.N., and none was offered.
Why look at Oil-for-Food? Well, let's review a little more history. When Saddam invaded Kuwait in 1990, the U.N. imposed sanctions, which remained in place until 2003, when the United States and its allies finally toppled Saddam. But in 1996, with the aim of providing for the people of Iraq while still containing Saddam, the U.N. began running its Oil-for-Food relief program for Iraq. Under terms agreed to by the U.N., Saddam got to sell oil to buy such humanitarian supplies as food and medicine, to be rationed to the Iraqi population. But the terms were hugely in Saddam's favor. The U.N. let Saddam choose his own business partners, kept the details of his deals confidential, and while watching for weapons-related goods did not, as it turns out, exercise much serious financial oversight. Saddam turned this setup to his own advantage, fiddling prices on contracts with his hand-picked partners, and smuggling out oil pumped under U.N. supervision with U.N.-approved new equipment. Thus did we arrive at the recent General Accounting Office estimate that under Oil-for-Food, despite sanctions, Saddam managed to skim and smuggle for himself more than $10 billion out of oil sales meant for relief.
And the timing gets interesting, especially the year 1998. Not only was that the year in which bin Laden signaled his big comeback in Afghanistan. It was also the year in which Oil-for-Food jelled into a reliable vehicle for Saddam's scams, a source of enormous, illicit income.
Oil-for-Food was set up as a limited and temporary measure, starting operations in late 1996 with somewhat ad hoc administration by the U.N., and a mandate that had to be renewed by the Security Council every six months or so. Less than a year into the program, however, on October 15, 1997, U.N. Secretary General Kofi Annan consolidated Oil-for-Food into what was effectively a permanent U.N. department--the Office of the Iraq Programme (OIP)--headed by a long-serving U.N. official, Benon Sevan. The Security Council still had to renew the mandate twice a year, but the process became routine.
Saddam began pushing the envelope, and it was quickly clear he could get away with a lot. Just two weeks after Annan set up the OIP, Saddam imposed conditions on the U.N. weapons inspectors that made it impossible for them to operate. Instead of shutting down Oil-for-Food, Annan on February 1, 1998, urged the Security Council to more than double the amount of oil Saddam was allowed to sell, a prelude to letting Iraq import oil equipment to increase production. Annan then flew to Baghdad to reason with Saddam, and on February 23, 1998 (having met in one of those palaces built under sanctions), Annan and Saddam reached an agreement that for at least a while allowed the weapons inspectors to return.
It was a busy time for al Qaeda as well. That same day, February 23, 1998, Osama bin Laden published his "Kill the Americans" fatwa. An intriguing feature of this fatwa was its prominent mention of Iraq, not just once, but four times. Analysts at the CIA and elsewhere have long propounded the theory that secular Saddam and religious Osama would not have wanted to work together. But Saddam's secular style seemed to bother bin Laden not a whit.
His fatwa presented three basic complaints. Mainly, he deplored the infidel presence in Saudi Arabia (i.e., the U.S. troops stationed there during and after the Gulf War). He also cited grievances about Jerusalem, while not even bothering to mention the Palestinians by name. The rest of his attention, bin Laden devoted to Iraq and "the Americans' continuing aggression against the Iraqi people" as well as "the great devastation inflicted on the Iraqi people by the crusader-Zionist alliance" and--here is the specific reference to U.S.-led sanctions--"the protracted blockade imposed after the ferocious war."
Two paragraphs later, bin Laden picked up this theme again, calling Iraq the "strongest neighboring Arab state" of Saudi Arabia, and then citing Iraq, yet again, as first on a list of four states threatened by America--the other three being Saudi Arabia (bin Laden's old home and a big source of terrorist funding), Egypt (birthplace of the terrorist Muslim Brotherhood and of bin Laden's top lieutenant, Ayman al Zawahiri, who also signed the fatwa), and Sudan (bin Laden's former base).
UNTIL 1998, Iraq had not loomed large in bin Laden's rants. Why, then, such stress on Iraq, at that particular moment, in declaring war on America? It is certainly possible that bin Laden simply figured Iraq had become another good selling point, a handy way to whip up anger at the United States. But it is at least intriguing that the month after bin Laden's fatwa, in March 1998, as the 9/11 Commission reports, two al Qaeda members visited Baghdad. And in July 1998, "an Iraqi delegation traveled to Afghanistan to meet first with the Taliban and then with bin Laden."
Later in 1998, Saddam kicked out the weapons inspectors, and he would keep them out for the following four years. The U.N. in 1999 lifted the ceiling entirely on Saddam's oil exports and expanded the range of goods he could buy. It would keep his deals confidential to the end, and it let Saddam do business with scores of companies in such graft-friendly climes as Russia and Nigeria, as well as such terrorist-sponsoring places as Saudi Arabia, Syria, and Sudan, and such financial hideouts as Liechtenstein, Panama, Cyprus, and Switzerland.
Much of Saddam's illicit Oil-for-Food money has yet to be traced. There are now at least eight official investigations into various aspects of Oil-for-Food, but none so far that combines adequate staffing and access with a focus on Oil-for-Food itself as the little black book of Saddam's possible terrorist links. The same kind of bureaucratic walls that once blocked our own intelligence community from nabbing al Qaeda are here compounded by the problem that Oil-for-Food was not a U.S. program, but on U.N. turf. And though the U.N. is the keeper of many of the records, Kofi Annan has displayed no interest in investigating the possibility that Oil-for-Food might have funded terrorists. Nor has the Bush administration pursued the matter with the speed and terrorist-tracking expertise it deserves. Millions of documents believed to contain details of Saddam's Oil-for-Food deals, quite likely including leads to his illicit side deals, are reportedly locked up in Baghdad, socked away there by Paul Bremer this past spring, awaiting an audit from Ernst & Young that is just now getting underway--and not necessarily focused on possible terrorist ties. The U.N.'s own investigation, led by former Federal Reserve chairman Paul Volcker, seems interested mainly in the U.N. itself. Various congressional investigators who, unlike the 9/11 Commission, are looking at Oil-for-Food, have had a hard time prying even the most basic documents out of the U.N.
The U.S. Treasury Department, in its hunt for Saddam's assets, is not looking specifically at Oil-for-Food, but has provided some of the most telling snippets of information. In April of this year, Treasury released a list of Saddam front companies its investigation has so far uncovered, including a major Oil-for-Food contractor in the UAE, Dubai-based Al Wasel & Babel. Along with trying to procure a sophisticated surface-to-air missile system for Saddam, Al Wasel & Babel did hundreds of millions' worth of business with Baghdad under Oil-for-Food, and was just one of some 75 contractors authorized by the U.N. to deal with Saddam out of the UAE. (As it happens, the 9/11 Commission found that some of the hijackers' funding flowed through the UAE, but working backward from the al Qaeda end, the trail eventually vanishes.)
But enough of facts. Let's return to the realm of possibility. Imagine:
From about 1998 on, Oil-for-Food became Saddam's financial network, a system he gamed to produce huge amounts of illicit income, in partnership with folks who helped him hide and spend it. If some of that money was going to al Qaeda while Saddam was in power, it may still be serving as a terrorist resource today. Amid all the consternation over missed signals and poor coordination leading up to September 11, is it too much to ask that someone versed in terrorist finances, and able to access both the U.N. Oil-for-Food records and the documents squirreled away in Baghdad, take a look--an urgent, detailed, systematic look--at whether Saddam via his Oil-for-Food scams sent money to al Qaeda?
For such a deal, both Saddam and bin Laden had motive and opportunity. And if you read bin Laden's 1998 fatwa with just a little bit of imagination, those mentions of Iraq, at that particular moment, in those particular ways, carry a strong whiff of what is known in our own society as product placement: a message from a sponsor.
Claudia Rosett is journalist-in-residence with the Foundation for the Defense of Democracies and a columnist for OpinionJournal.com.
? Copyright 2004, News Corporation, Weekly Standard, All Rights Reserved.

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Elaborate Qaeda Network Hid 2 Captives in Pakistan
By AMY WALDMAN and SALMAN MASOOD
LAHORE, Pakistan, Aug. 2 - In mid-May, a C.I.A. expert on Al Qaeda briefed Pakistani law enforcement officials on the existence of an elusive operative who was said to be eager to attack Americans, according to a Pakistani intelligence official. Nearly two months later, Pakistani officials traced him to the port city of Karachi and then here.
On July 13, they made an arrest in the case, picking up Muhammad Naeem Noor Khan, a 25-year-old computer engineer, when he went to the airport to collect a package from his father.
Pakistani officials say the arrest of Mr. Khan led officials to Ahmed Khalfan Ghailani, a Tanzanian operative of Al Qaeda who is accused of involvement in the bombings of American Embassies in Kenya and Tanzania in 1998 and who was one of the F.B.I.'s 22 most-wanted terrorists. Mr. Ghailani was arrested July 25 in the small eastern city of Gujrat, where he had slipped in about six weeks earlier, according to the city's police chief, Raja Munawar Hussain.
The exposure of the two men, one an experienced foreign operative and the other a young Pakistani who is thought to have passed messages for Al Qaeda, illustrates how senior members of the terrorist network, possibly even Osama bin Laden, continue to successfully hide in Pakistan. Both men appear to have been part of what senior Pakistani officials describe as an elaborate and well-equipped underground network the group has established in this country, a critical American ally in fighting terrorism.
Statements by Mr. Khan about his travels and activities also appear to confirm long-running suspicions that foreign members of Al Qaeda have been able to safely operate from Pakistan's remote tribal areas for at least the past 18 months.
It is not yet clear whether Mr. Ghailani was living in the tribal areas before his move about six weeks ago to Gujrat. Interior Minister Faisal Saleh Hyat said only that Mr. Ghailani had been successfully hiding in another part of Pakistan "for some time," without providing details.
But in Gujrat, at least, Mr. Ghailani managed to live in comfort with Pakistani help. He lived in a spacious two-story home in a middle-class neighborhood, apparently without raising suspicions in the local police force.
During Mr. Ghailani's time in Gujrat, a young Pakistani man lived in the house with him, apparently buying food and supplies from a nearby market and allowing the fugitive, a black African, to remain inside and go unnoticed, according to Mr. Hussain, the police chief.
Mr. Hussain, who suspended 64 local patrolmen and senior officers for negligence after Mr. Ghailani was arrested, said his officers had received no reports of unusual activity in the neighborhood. The police chief said he was alerted to the presence of a foreign terrorist only when he received an urgent phone call from Pakistani intelligence officials the night of July 24.
After a 16-hour gun battle, Mr. Ghailani, two South African men, three women, five children and a Pakistani surrendered the morning of July 25. Inside the house, the police found two laptop computers, two foreign passports in Mr. Ghailani's name, two satellite phones, maps and chemicals, Mr. Hussain said.
Mr. Khan would have had no trouble blending in. He is from a middle-class religious family in Karachi, Pakistan's largest city. The family lives on the first floor of a two-story house in a middle-class housing complex in the heart of the city. The house is situated near a madrasa, a mosque and a house where a small religious school for women is held.
His father, Noor Khan, an employee of the state airline, said Monday that his son had not been living with him for two and a half years, so he did not know what he had been doing or where he had been living.
"Today's offspring don't care about parents, so Naeem was living separately," he added. He said he did not even know whether his son had been arrested.
Mr. Khan told his interrogators that at a wedding in the 1990's, he met a Saudi man who introduced him to people who eventually sent him to a training camp for militants in Afghanistan, according to a Pakistani intelligence official.
Later, Mr. Khan said, a man he met with in Pakistan's tribal areas, an isolated region near the border with Afghanistan, introduced him to another man who eventually became his Qaeda handler. He dealt with that man's e-mail messages, and became part of an elaborate network for transmitting messages across Pakistan and then posting them in coded e-mail messages or on the Web.
Mr. Khan described several meetings with men believed to be Qaeda operatives - including one in January 2003 in Karachi, and one in July 2003 in the tribal areas, the intelligence official said.
The tribal areas have long been suspected of being a safe haven for members of Al Qaeda, including Mr. bin Laden. American soldiers say the region is used as a staging area for attacks on American forces in Afghanistan.
Mr. Khan told investigators that Qaeda leaders met in the Shakai Valley in the South Waziristan Tribal Agency. Pakistan's military has identified the valley as a stronghold for hundreds of foreign militants, officials say, and Pakistani forces have said they have bombed an important terrorist training facility and meeting center there.
Terrorist attacks carried out since January 2002 also have been linked to the tribal areas. Explosives used in one of two failed assassination attempts on President Pervez Musharraf of Pakistan were purchased in the Khurram Tribal Agency there, according to the intelligence official.
An investigator who worked on the disappearance of the American journalist Daniel Pearl in 2002 in Karachi also said phone records showed that his kidnappers had called the town of Wana in South Waziristan three times.
The failure of Pakistan to act in the tribal areas until recently has led some Pakistani and American analysts to question the seriousness of General Musharraf's efforts, but Pakistani officials insisted Monday that the two recent arrests were evidence of their commitment and success in fighting terrorism.
Amy Waldman reported from Lahore for this article, and Salman Masood from Gujrat. Mohammed Khan contributed reporting from Peshawar, and Zulfiqar Shah from Karachi.
Copyright 2004 The New York Times Company

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Russian parliament votes on controversial social reform
MARIA DANILOVA, Associated Press Writer
Tuesday, August 3, 2004
(08-03) 11:25 PDT MOSCOW (AP) --
Russia's pro-Kremlin parliament on Tuesday backed a bill that would replace benefits such as subsidized transportation and medicine with cash payments, dismantling remnants of the Soviet welfare state and affecting millions of vulnerable citizens, including war veterans and pensioners.
The proposed legislation is part of the unpopular and potentially painful reforms President Vladimir Putin has promised to tackle during his second term. It has sparked criticism across Russia, with nearly daily protests in Moscow last week and several rallies held in dozens of Russia's far-flung regions over the past month.
The State Duma supported the bill Tuesday in a 304-120 vote, with one abstention, and was expected to pass it in a final vote Thursday. The bill then must be approved by the upper house, which is also obedient to the Kremlin, before it goes to Putin for his signature.
Advocates of the government-backed bill say substituting cash for benefits will make aid more accurately targeted -- arguing, for example, that public transportation is scarce in rural areas and supplies of subsidized medicines are short. They also say it will put people less at the mercy of the country's laborious bureaucracy.
But opponents of the bill -- which affects over 30 million of the neediest Russians, more than one-fifth of the population -- say the proposed payments, which start at $5 a month, will be eaten away quickly by inflation and will not be paid in full by regional authorities. They also say some privileges, such as job guarantees for the disabled, are not subject to any monetary compensation.
"It's incompatible -- what they are giving and what they are taking away from us," said Mikhail Novikov, an activist for the disabled. He added that the monthly payment of some $35 he would be entitled to won't come close to covering needs such as medicines, regular medical care and sanatorium stays.
While lawmakers debated the bill, activists staged new protests in the vicinity of the Duma, which was cordoned off by police. Several young members of the liberal Yabloko party wrapped themselves in white bandages to resemble mummies and pinned notes on their bodies saying: "This is what we will become after they ban the benefits."
Tamara Kondratyeva, a 76-year-old retiree, who has to survive on an $85 monthly pension said she doesn't know how to make ends meet if free transportation and medical care are canceled.
"It really hurts. We tried so hard to beat those Germans (in World War II) and now they (the Russian authorities) are destroying us," Kondratyeva said bitterly.
Injured veterans of the war would receive a monthly payment of $53 under the law, Russian news agencies reported.
"This is what happens when you have a one-party parliament," independent lawmaker Svetlana Goryacheva told reporters Tuesday. The main pro-Kremlin party, United Russia, swept December parliamentary elections and now dominates the Duma, holding more than two-thirds of its 450 seats.
Duma speaker Boris Gryzlov, of United Russia, said in televised comments Tuesday that he "was deeply convinced" that the situation for citizens now entitled to benefits "will significantly improve" with the new law.
But lawmakers outside United Russia lambasted the bill.
"Scientists first experiment on animals. But our government is experimenting on people, on the whole country," said Gennady Seleznyov, an ex-Communist and former Duma speaker who now is an independent lawmaker.

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Paul R. Pillar
Counterterrorism after
Al Qaeda
? 2004 by The Center for Strategic and International Studies and the Massachusetts
Institute of Technology
The Washington Quarterly * 27:3 pp. 101-113.
THE WASHINGTON QUARTERLY SUMMER 2004 101
Paul R. Pillar is a former deputy chief of the Central Intelligence Agency's Counterterrorist Center and author of Terrorism and U.S. Foreign Policy. The views in this article are theauthor's own. The fight against Osama bin Laden's Al Qaeda, the principal terrorist menace to U.S. interests since the mid-1990s, has come a long way. The disciplined, centralized organization that carried out the September 11attacks is no more. Most of the group's senior and midlevel leaders are either incarcerated or dead, while the majority of those still at large are on the run and focused at least as much on survival as on offensive operations. BinLaden and his senior deputy, Ayman al-Zawahiri, have survived to this point but have been kept on the run and in hiding, impairing their command and control of what remains of the organization. Al Qaeda still has the capacityto inflict lethal damage, but the key challenges for current counterterrorism efforts are not as much Al Qaeda as what will follow Al Qaeda. This emerging primary terrorist threat has much in common with Al Qaeda in that it involves the same global network of mostly Sunni Islamic extremists of which bin Laden has been the best known voice. "Al Qaeda" is often broadly applied to the entire terrorist network that threatens U.S. interests although, in fact, the network extends beyond members of this particular organization. The roots of this brand of extremism, if not its most visible advocates and centralized structure, remain very much alive and in some cases are growing deeper. They include the closed economic and political systems in much of the Muslim world that deny many young adults the opportunity to build better lives for themselves and, often, the political representation to voice their grievances peacefully over the lack of such opportunity. Among other lasting causal factors behind the rise of Islamist terrorism are the paucity of credible alternatives to militant Islam as vehicles of
l Paul R. Pillar
THE WASHINGTON QUARTERLY SUMMER 2004 102
opposition to the established order as well as widespread opposition toward U.S. policies within and toward the Muslim world, especially the U.S. position on the Israeli-Palestinian conflict and, more recently, the invasion and occupation of Iraq. In short, even with Al Qaeda waning, the larger terrorist threat from radical Islamists is not. That radical Islamist threat will come from an eclectic array of groups, cells, and individuals. Those fragments of Al Qaeda that continue to carry on bin Laden's malevolent cause and operate under local leaders as central direction weakens will remain part of the mix. Also increasinglypart of the greater terrorist network are like-minded but nameless groups associatedwith Al Qaeda, such as the Middle Eastern organization headed by Abu Musab al-Zarqawi, and regionally based groups with established identities such as the Iraq-centered Ansar al- Islam and the Southeast Asian Jemaah Islamiya. Many of these groups have local objectives but share the transnational anti-Americanism of the larger network. Finally, individuals best labeled simply as jihadists, who carry no group membership card but move through and draw support from the global network of likeminded radical Islamists, are also part of the picture. From their ranks, some will likely emerge with the leadership skills needed to organize operational cells and conduct terrorist attacks. In a word, the transformation of the terrorist threat from the Al Qaeda of September 11, 2001, to the mixture described above is one of decentralization. The initiative, direction, and support for anti-U.S. terrorism will come from more, and more widely scattered, locations than it did before. Although the breaking up of Al Qaeda lessens but does not eliminate the risks posed by particularly large, well-organized, and well-financed terrorist operations, the decentralization of the threat poses offsetting problems for collecting and analyzing related intelligence, enlisting foreign support to counter it, and sustaining the United States' own commitment to combat it while avoiding further damage to U.S. relations with the Muslim world. For these reasons, the counterterrorism challenges after the defeat of Al Qaeda may very well be even more complex than they were before. Uncertain Targets for Intelligence The small, secretive nature of terrorist plots and the indeterminate nature of the target--likely to become an even greater problem as the Islamic ter-
The centralized
organization that carried out the September 11 attacks is no more. THE WASHINGTON QUARTERLY SUMMER 2004 Counterterrorism after Al Qaeda l 103 rorist threat further decentralizes--have always made terrorism a particularly difficult target subject. The mission of intelligence in counterterrorism is not only to monitor known terrorists and terrorist groups but also to uncover any individuals or groups who might conduct a terrorist attack against the United States and its interests. The greater the number of independent actors and centers of terrorist planning and operations, the more difficult that mission becomes. Exhortations to the intelligence community to penetrate terrorist groups are useless if the groups that need to be penetrated have not even been identified. The U.S. intelligence community's experience a decade ago may help it adjust to the transformation currently underway. Prior to the 1993 World Trade Center (WTC) bombing, the terrorist threat against the United States was thought of chiefly in terms of known, named, discrete groups such as the Lebanese Hizballah. The principal analytical challenges involved identifying the structure and strength of each group as well as making sense of the pseudonymous "claim names" commonly used to assume responsibility for attacks. The 1993 WTC bombing and the subsequent rolled-up plot to bomb several other New York City landmarks introduced the concept of ad hoc terrorists: nameless cells of radicals who come together for the sole purpose of carrying out a specific attack. The term "ad hoc" was subsequently discarded as too casual and as not reflecting the links to the wider network that intelligence work through the mid-1990s gradually uncovered. Even with those links, however, the New York plots were examples of a decentralized threat in that they were evidently initiated locally. As demonstrated by the shoestring budget on which the 1993 WTC bombers operated, the plots were not directed and financed by bin Laden from a lair in Sudan or South Asia but rather by the operation's ringleader, Ramzi Yousef, and his still unknown financial patrons. Now, in 2004, with Al Qaeda having risen and mostly fallen, the threats that U.S. intelligence must monitor in the current decade have in a sense returned to what existed in the early 1990s; only now the threat has many more moving parts, more geographically disparate operations, and more ideological momentum. Much, though not all, of the intelligence community's counterterrorism efforts over the past several years can be applied to the increasingly decentralized threat the world now faces. Even the intelligence work narrowly focused on Al Qaeda has unearthed many leads and links, involving anything from telephone calls to shared apartments, that are useful in uncovering Even with Al Qaeda waning, the larger terrorist threat from radical Islamists is not. l Paul R. Pillar THE WASHINGTON QUARTERLY SUMMER 2004 104 other possible centers of terrorist planning and operations. These links are central to intelligence counterterrorism efforts because linkages with known terrorists can uncover other individuals who may be terrorists themselves. Most successful U.S. efforts to disrupt terrorist organizations in the past, including the capture of most of the Al Qaeda leadership since September 11, 2001, have resulted from such link analysis. The danger now lies in the fact that the looser the operational connections become and the less Islamist terrorism is instigated by a single figure, the harder it will be to uncover exploitable links and the more likely that the instigators of future terrorist attacks will escape the notice of U.S. intelligence. In a more decentralized network, these individuals will go unnoticed not because data on analysts' screens are misinterpreted but because they will never appear on those screens in the first place. The September 11 plot helps to illustrate the point. Retrospective inquiries have given a great deal of attention to the tardiness in placing two of the hijackers, Khalid al-Mihdhar and Nawaf al-Hazmi, on U.S. government watch lists. Had these individuals been identified, they might have been prevented from entering the United States and launching the attack. Ironically, less attention has been paid to what made al-Mihdhar and al-Hazmi candidates for a watch list in the first place: their participation in a meeting with an AlQaeda operative in Kuala Lumpur. U.S. intelligence acquired information about the meeting by piecing together Al Qaeda's activities in the Far East and by developing rosters of Al Qaeda intermediaries whose activities could be tracked to gain information that would provide new leads. Although skillful and creative intelligence work, it relied on linkages to a known terrorist group, Al Qaeda--linkages that existed because bin Laden and senior Al Qaeda leadership in South Asia ultimately directed and financed the terrorist operation in question. A decentralized version of the threat will not necessarily leave such a trail. Muhammad Atta and some of the other September 11 hijackers were never even considered candidates for the watch lists because intelligence reporting had not previously associated them with known terrorists. In fact, one of Al Qaeda's criteria for selecting the hijackers almost certainly was that they were relatively clean, in that they did not have any such associations. In a more decentralized future network, such connections are even less likely. Yet, even a decentralized terrorist threat has some linkages that can be exploited, and this will be key to intelligence community counterterrorist ef- A decentralized terrorist threat will not necessarily leave an intelligence trail. THE WASHINGTON QUARTERLY SUMMER 2004 Counterterrorism after Al Qaeda l 105 forts from here on out. Within the networks of Sunni Islamic extremists, almost everyone can be linked at least indirectly, such as through their past common experiences in camps in Afghanistan, to almost everyone else. The overwhelming majority of these linkages, however, consists of only casual contacts and do not involve preparations for terrorist operations directed against the United States, as the meeting in Kuala Lumpur evidently did. No intelligence service has the resources to monitor all of these contacts, to compile the life history of every extremist who has the potential to become a terrorist, or to construct comprehensive sociograms of the radical Islamist scene. Detecting the perpetrators of the next terrorist attack against the United States will therefore have to go beyond link analysis and increasingly rely on other techniques for picking terrorists out of a crowd. Mining of financial, travel, and other data on personal actions and circumstances other than mere association with questionable individuals and groups1 is one such technique. The potential for such data mining goes well beyond current usage. Yet, data mining for counterterrorism purposes will always require a major investment in obtaining and manipulating the data in return for only a modest narrowing of the search for terrorists. Numerous practical difficulties in gaining access to personal information, significant privacy issues, and the lack of a reliable algorithm for processing the data all inhibit the effectiveness of this technique. The September 11 attacks, however, significantly lowered the threshold for all investments in counterterrorist operations, including data mining, making this technique worth trying even if it appears no more cost effective than it did before September 11, 2001. The Transportation Security Administration already uses profiling to screen air passengers; the intelligence community might reasonably extend this technique to include profiling of foreigners to identify possible terrorists even before they buy an airplane ticket. It is the U.S. population and the U.S. government, not the intelligence community, that will have to make the most important adjustment concerning intelligence operations. The reality is that they will have to lower their expectations of just how much of the burden of stopping terrorists that intelligencecan carry. An increasingly decentralized terrorist threat and indeterminate intelligence target will mean that an even greater number of terrorists and terrorist plots may escape the notice of intelligence services altogether. The transformation in the threat itself coupled with the inherent limits of intelligence operations implies that more of the counterterrorist burden will have to be borne by other policy instruments, from initiatives to address the reasons individuals gravitate toward terrorism in the first place to physical security measures to defeat attempted attacks. l Paul R. Pillar THE WASHINGTON QUARTERLY SUMMER 2004 106 Fragile International Cooperation The willingness of governments worldwide to join the campaign against terrorism has increased significantly over the last two decades--a welcome change from earlier days when many regimes, through their representatives at the United Nations General Assembly and elsewhere, were more apt to condone terrorism than to condemn it because of their support for "national liberation movements." The September 11 attacks further strengthened an apparent global antiterrorism consensus. This apparent collective commitment to counterterrorism should not be taken for granted. Despite many governments' declarations that they stand with the United States in combating terrorism, each decision by a foreign government on whether to cooperate with the United States reflects calculations about the threat that nation faces from particular terrorist groups, its relations with the United States, any incentives Washington offers for its cooperation, domestic opinion, and the potential effect of enhanced counterterrorist measures on its domestic interests. Such calculations can change, and the perceived net advantage of cooperating may be slim. In short, global cooperation against terrorism is already fragile. Much of foreign governments' willingness to help has depended on Al Qaeda's record and menacing capabilities. The sheer enormity of the September 11 attacks and the unprecedented impact they had on the U.S. government's priorities and policies have accounted for much of the increased willingness among foreign governments to assist in efforts to combat terrorism. The threat Al Qaeda has posed to some of the governments themselves, particularly the Saudi regime, also has helped the United States gain cooperation. The bombings in Riyadh in May and November 2003 were wake-up calls that partly nullified the numerous reasons for the Saudis' sluggishness in cracking down on Islamic extremists in their midst. Most of the victims of the November bombing were Arabs of modest means; this sloppy targeting undoubtedly cost Al Qaeda some of its support in the kingdom. Foreign cooperation will become more problematic as the issue moves beyond Al Qaeda. How will governments respond to a U.S. appeal to moveagainst groups that have never inflicted comparable horrors on the United States or on any other nation or against groups that do not conspicuously pose the kind of threat that Al Qaeda has posed to Saudi Arabia? How can regimes be motivated to tackle Islamic groups that may represent an emerging terrorist threat but have not yet resorted to terrorism, such as the Central Asian- based Hizb al-Tahrir? Without the special glue that the attacks of September 11 provide against a centralized and directed Al Qaeda, many of the past reasons for foot-dragging in counterterrorist efforts are likely to reassert themTHE WASHINGTON QUARTERLY SUMMER 2004 Counterterrorism after Al Qaeda l 107 selves. These reasons include the sympathy that governments or their populations feel for many of the anti-Western or anti-imperialist themes in whose name terrorists claim to act, an aversion to doing Washington's bidding against interests closer to home, and a general reluctance to rock local boats. Problems that the United States has already encountered in dealing with Lebanese Hizballah2 illustrate some of the difficulties in more generally enlisting foreign help against terrorist groups--even highly capable groups-- other than Al Qaeda. Deputy Secretary of State Richard Armitage once called Hizballah the "A-team" of international terrorism;3 the group's 1983 bombing of U.S. Marine barracks in Beirut is second only to the events of September 11, 2001, in the number of American deaths attributable to a terrorist attack. Hizballah's terrorist apparatus, led by its longtime chief Imad Mughniyah, remains formidable today. The dominant view of Hizballah in Lebanon and elsewhere in the Middle East, however, is that the group is a legitimate participant in Lebanese politics: the group holds seats in Parliament and provides social services within the country. Despite the events two decades ago in Lebanon, including other bombings and a series of kidnappings of Westerners, Hizballah's accepted political status has prevented U.S. officials from effectively appealing for cooperation against Hizballah in the way that the September 11 attacks have allowed them to appeal for cooperation against Al Qaeda. Notwithstanding the major potential terrorist threat it poses, Hizballah has not been clearly implicated in any attack on Americans since the bombing of Khobar Towers eight years ago.
An underlying limitation to foreign willingness to cooperate with the United States on antiterrorist efforts is the skepticism among foreign publics and even elites that the most powerful nation on the planet needs to be preoccupied with small bands of radicals. Even the depth of the trauma that the September 11 attacks caused the American public does not seem to be fully appreciated in many areas overseas, particularly in the Middle East. In addition,the skepticism is likely to be much greater when the U.S. preoccupation is no longer with the group that carried out the September 11 attacks. Any reduced foreign support for the campaign against terrorism will not be clear or sudden. Certainly, no foreign government will declare that it now supports the terrorists. Instead, foreign governments may be a little slower to act, a little less forthcoming with information, or slightly more apt to cite domestic impediments to cooperation. Whether counterterrorism coopera- Foreign cooperation will become more problematic as the issue moves beyond Al Qaeda.
l Paul R. Pillar
THE WASHINGTON QUARTERLY SUMMER 2004 108
tion weakens, therefore, will rest largely on whether and how Washington responds to the concerns and needs of its foreign partners. As antiterrorist cooperation becomes increasingly more difficult to obtain and more vulnerable to frictions over other issues, sustaining such cooperation will require increased sensitivity to foreign interests.
Muslims' Suspicions
Skepticism and distrust among Muslims across the world about U.S. counterterrorist efforts have impeded international cooperation and may become an even bigger problem in the post-Al Qaeda era. With the perpetrators of the September 11 attacks disabled and Muslims--especially Muslims claiming to act in the name of their religion--still dominating international terrorism, Muslims will still dominate Washington's counterterrorist target list. This fact will continue to encourage questions about whether the socalled U.S. war on terrorism is really a war on Islam. Many Muslims will ask whether a sustained counterterrorist campaign has less to do with fighting terrorism than with maintaining the political status quo in countries withpro-U.S. regimes. Other Muslims will see the campaign as many already see it: as part of a religiously based war between the Muslim world and a Judeo-Christian West.
The "war on terrorism" terminology exacerbates this problem, partly because a war is most clearly understood as a war against somebody rather than a metaphorical war against a tactic. The fact that counterterrorist operations have been aimed primarily at a particular group, Al Qaeda, has minimized this problem thus far. The less the fight is conducted against a single named foe, the greater the problem of misinterpreting the term "war." The problem has been exacerbated by extension of the "war on terrorism" label to the invasion and occupation of Iraq. Even though much of the violence that has plagued Iraq since the operation began is unmistakably attributable to terrorism, the U.S. government undertook the military operation in Iraq primarily for reasons other than counterterrorism, feeding Muslim misperceptions and fears that the United States also has ulterior motives every other time it talks about fighting terrorism.
Such perceptions among Muslims will strengthen the roots of the very Islamist terrorism that already poses the principal threat to U.S. interests. They will encourage a sense that the Muslim world as a whole is in a struggle with the Judeo-Christian West and foster a view of the United States as the chief adversary of Muslims worldwide. Given the fact that Islamist extremism is likely to continue to be the driving force behind significant terrorist threats to U.S. interests, fighting terrorism without the effort being perceived simply as a
THE WASHINGTON QUARTERLY SUMMER 2004 Counterterrorism after Al Qaeda l 109 war against Muslims may be a challenge that can only be lessened and not altogether avoided. President George W. Bush and senior U.S. officials have been careful to disavow any antipathy toward Muslims, which has helped to a certain extent. Most Muslims' attitudes will be shaped more by deeds than by words, however, which means that U.S. policies toward Iraq and the Arab- Israeli conflict in particular will be especially influential. Maintaining the Commitment The greatest future challenge to the U.S. counterterrorist efforts that may emerge with a more decentralized terrorist threat is the ability to sustain the country's own determination to fight it. The American public has shown that its commitment to counterterrorism can be just as fickle as that of foreign publics. Over the past quarter century, the U.S. population and government has given variable attention, priority, and resources to U.S. counterterrorist programs, with interest and efforts spiking in the aftermath of a major terrorist incident and declining as time passes without an attack. Important to keep in mind about the strong U.S. attention to counterterrorism during the last three years is that it took a disaster of the dimensions of September 11, 2001, to generate. Although intended to topple the twin towers and kill thousands, the 1993 WTC bombing sparked nothing near a similar amount of attention. Bin Laden and the prowess his group demonstrated with overseas attacks garnered full appreciation among U.S. government specialists of Al Qaeda's intentions and capabilities by at least the late1990s but still remained comparably unnoticed by the greater U.S. public and government. U.S. citizens and their elected leaders and representatives respond far more readily to dramatic events in their midst than to warnings and analysis about threatening events yet to occur. The further the events of September 11 fade into the past, the more difficult it will be to keep Americans focused on the danger posed by terrorism, especially that posed by terrorists other than the perpetrators of the WTC and Pentagon attacks.
The U.S. response to the March 2004 bombing of commuter trains in Madrid suggests how difficult it is to energize or reenergize Americans about counterterrorism. (Early investigation of the attack indicated that it wasalso a good example of the decentralized Islamist terrorist threat, being the work of Muslim radicals with only loose associations with Al Qaeda.) Commentary in the United States focused less on the continued potency of the global terrorist threat than on inter-allied differences over the Iraq war, with charges of "appeasement" leveled against Spanish voters for ousting the governing party in an election held three days after the attack. For most Americans, the difference between terrorism inside the United States and terrorism
l Paul R. Pillar
THE WASHINGTON QUARTERLY SUMMER 2004 110
against even a close ally is huge, with only the former capable of boosting their commitment to counterterrorism.
Here again, the "war on terrorism" metaphor appears problematic. Americans tend to think in non-Clausewitzian terms, in which war and peace are markedly different and clearly separated states of being. War entails special sacrifices and rules that the United States does not want to endure in peacetime. Peace means demobilization, relaxation of the nation's guard, and a return to nonmartial pursuits. In U.S. history, in particular, peace has usually meant either victory or withdrawal and a rejection of the reasons for having gone to war in the first place, such as with the Vietnam War. Americans are not accustomedto the concept of a war that is necessary and waged with good reason but offers no prospect of ending with a clear peace and especially a clear victory.4 U.S. leaders have conveyed some of the right cautions to the public. Secretary of Defense Donald Rumsfeld correctly observed
that the war on terrorism will not end with a surrender on the deck of the USS Missouri.5 Attitudes in the United States, however, probably will be shaped less by such words of caution than by the historical conception of war and peace. Moreover, not having a clear end is not the same as having no end--and the latter is, for practical purposes, what the United States faces in countering terrorism during the years ahead.
In fact, an end, whether clear or not so clear, will be even more elusive in the fight against terrorism than it was during the Cold War. Though the Cold War did not conclude with the signing of any surrender agreement on a battleship, its end was nonetheless fairly distinct, highlighted by the dismantling of the Berlin Wall in November 1989 and the dissolution of the Soviet Union in December 1991. It also entailed an indisputable victory for the West, achieved with the collapse of a single arch foe. Success in counterterrorism offers no such prospect.
The sense of being at war has been sustained thus far not only by war on terrorism rhetoric but also by certain practices that resemble those used in real shooting wars of the past, such as indefinite detention of prisoners without recourse to civilian courts. Although quite useful in mustering support for the invasion, the application of the "war on terrorism" label to the campaign in Iraq will compound the difficulty in sustaining domestic public support for counterterrorism in the post-Al Qaeda era. Even if the reconstruction and democratization of Iraq go well, the fact that this campaign will not
Skepticism and distrust among Muslims about the U.S. may become an even bigger problem.
THE WASHINGTON QUARTERLY SUMMER 2004
Counterterrorism after Al Qaeda l
111
bring an end to anti-U.S. terrorist attacks elsewhere might lead many in the United States to question whether the sacrifices made in the name of fighting terrorists had been worthwhile. With so much attention having been paid to state sponsorship of terrorists, and to one (now eliminated) state sponsor in particular, further appeals to make still more sacrifices to defeat disparate and often nameless groups are apt to confuse many U.S. citizens.More specifically, an unfavorable outcome in Iraq would mean that the Bush administration could face an increase in skepticism about the credibility of warnings concerning threats to U.S. security, including terrorist threats. Meanwhile, the existence of a specific, recognizable, hated terrorist enemy has helped the U.S. population retain its focus. As long as Al Qaeda exists, even in its current, severely weakened form, it will serve that function. Yet, when will Al Qaeda be perceived as having ceased to exist? The group's demise will be nowhere near as clear as, say, the fall of a government.
For the U.S. public, the signal that terrorism has been eliminated as a threat is likely to be the death or capture of bin Laden. Americans tend to personalize their conflicts by concentrating their animosity on a single despised leader, a role that Adolf Hitler and Saddam Hussein played at different times in history. This personalized perspective often leads to an overestimation of the effect of taking out the hated leader, as if the conflict were a game of chess in which checkmate of the king ends the contest. The euphoria following Saddam's capture in December 2003 is an example. Bin Laden, although on the run since 2001, probably has played a role in Al Qaeda's operations almost as limited and indirect as Saddam's influence was on the Iraqi insurgency during his eight months in hiding. Yet, this is where any similarities with Iraq ends. The elimination of bin Laden, if followed by several months without another major Al Qaeda operation against the United States, would lead many in the United States to believe that the time had come to declare victory in the war on terrorism and move on to other concerns. Meanwhile, bin Laden's death would not end or even cripple the radical Islamist movement. Fragments of the organization are likely to spread, subdivide, and inject themselves into other parts of the worldwide Islamist network, like a metastasizing cancer that lives on with sometimes lethal effects even after the original tumor has been excised.
Context and Consequences
Any erosion in the U.S. commitment to counterterrorism that may occur in the years ahead will depend not only on popular perceptions (or misperceptions) of the terrorist threat but also on the broader policy environment in which national security decisions are made. Available resources constitute part of
l Paul R. Pillar
THE WASHINGTON QUARTERLY SUMMER 2004 112
that environment. The resources devoted to counterterrorist operations may decline not because of a specific decision to reduce them but because any further reductions in spending for national security would reduce funds available for counterterrorism. Recent surges in both defense spending and budget deficits make some such reductions likely during the next several years. Departmental comptrollers seeking to spread the pain of those budget cuts will inflict pain on counterterrorist programs along with everything else.
Controversies over privacy and civil liberties constitute another part of the policy environment. The United States has already experienced a backlash against some provisions of the principal post-September 11 counterterrorist legislation, the USA PATRIOT Act. In the wake of the attacks, the U.S. government's investigative powers expanded in some ways that would have been unthinkable earlier. As the clear danger represented by Al Qaeda appears to recede, pressures to roll back those powers will increase.
Any diminution, for whatever combination of reasons, of the priority the United States gives to counterterrorist operations will have consequences that go well beyond specific counterterrorist programs. At home, the impact would be seen in everything from reduced vigilance by baggage screeners to less tolerance by citizens for the daily inconveniences brought about by stricter security measures. Abroad, a weaker commitment to counterterrorism on the part of the U.S. public would make it more difficult for U.S. diplomats to insist on cooperation from foreign governments.
How long any reduction of the U.S. commitment to counterterrorism lasts depends on how much time passes before the next major terrorist attack against U.S. interests, especially the next such attack on U.S. soil. Time, as always, is more on the side of the terrorist, whose patience and historical sense is greater than that of the average American. Americans' perception of the threat almost certainly will decline more rapidly than the threat itself.
The United States thus faces during the next several years an unfortunate combination of a possibly premature celebration along with a continuing and complicating terrorist threat. The counterterrorist successes against Al Qaeda thus far have been impressive and important, and the capture or death of bin Laden will unleash a popular reaction that probably will be nothing short of ecstatic. That joy could be a harmful diversion, however,
The greatest challenge will be the ability to sustain U.S. determination to fight terrorism.
THE WASHINGTON QUARTERLY SUMMER 2004
Counterterrorism after Al Qaeda l
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from attention that will be needed more than ever in the face of remaining problems: difficulty in cementing the counterterrorist cooperation of foreign partners, antagonism and alienation within the Muslim world that breeds more terrorists, and added complexity for intelligence services charged with tracking the threat.
The chief counterterrorist problem confronting U.S. leaders in the years ahead will be a variation on an old challenge: sustaining a national commitment to fighting terrorism even in the absence of a well-defined and clearly perceived danger. The demise of Al Qaeda will make the need for that commitmentless apparent to most U.S. citizens, even though the danger will persist in a different form. Political leaders will bear the heavy burden of instilling that commitment, and they will have to do so with analysis, education, and their powers of persuasion, not just with symbols and war cries. No doubt, that will be a very difficult task.
Notes
1. Paul R. Pillar, "Statement to Joint Inquiry of the Senate Select Committee on Intelligence and the House Permanent Select Committee on Intelligence," Washington, D.C., October 8, 2002, www.cia.gov/nic/testimony_8oct2002.html (accessed March 20, 2004).
2. See Daniel Byman, "Should Hizballah Be Next?" Foreign Affairs 82, no. 6 (November/ December 2003): 54-66.
3. Office of International Information Programs, U.S. Department of State, "Conditions Underlying Conflict Must Be Addressed, Armitage Says," September 5, 2002, http://usinfo.state.gov/topical/pol/terror/02090504.htm (accessed March 20, 2004) (speech and question and answer session with Deputy Secretary of State Richard Armitage at the U.S. Institute of Peace, Washington, D.C., September 5, 2002).
4. One of the more thoughtful statements that looks to a "victory" against terrorism is found in Gabriel Schoenfeld, "Could September 11 Have Been Averted?" Commentary 112, no. 5 (December 2001): 21-29. See also Commentary 113, no. 2 (February 2002): 12-16 (subsequent correspondence about Schoenfeld's article).
5. Donald Rumsfeld, interview, Face the Nation, CBS, September 23, 2001.

U.S. sanctions Russian firm that traded missiles to Iran
SPECIAL TO WORLD TRIBUNE.COM
Friday, July 30, 2004
The United States has imposed sanctions on a Russian defense contractor said to have traded missile and other advanced weaponry to Iran.
The State Department imposed sanctions on the Federal Research and Production Center. The sanctions, which took effect on July 22, came amid a U.S. determination that Federal Research proliferated missile technology.
"We will continue to work hard with the Russian government to prevent Russian entities from contributing to weapons of mass destruction, missile programs or conventional weapons programs of concern that could aid terrorists or threaten the United States or our friends and allies," a State Department statement said.
Officials said the sanctions on the Russian company would last for two years, Middle East Newsline reported. During that time, the United States or companies would be banned from exporting to or trading equipment or technology with Federal Research. The company was not known to have any business in the United States.
The research center is located in Biysk, in the province of Altai. The department did not cite which country received the missile technology from the Russian firm
But the State Department move was meant to have targeted Federal Research's trade with Iran, officials said. They said Iran has purchased missiles and components from the Russian defense firm for Teheran's Shihab-3 and Shihab-4 intermediate-range missile programs.
Russian officials and the company denied that that the research center traded with Iran. They said the center sold weapons components to India.
"The company observes all international obligations related to nonproliferation of missile and other technologies," Federal Research director-general Nikolai Tochilov was quoted by the Interfax news agency as saying. "In my view, these accusations are not substantiated."
Federal Research became the seventh Russian firm under U.S. sanctions. They included the Baltic State Technical University of St. Petersburg, Glavkosmos of Moscow, the Moscow Aviation Institute and the D. Mendeleyev University of Chemical Technology of Russia.
Two of the firms were accused of transferring weapons of mass destruction components to Iran. In April, the State Department lifted sanctions from six other Russian companies and a chemical weapons expert, Anatoly Kuntsevich.
The State Department's latest sanctions came as officials said Iran has sought to import deuterium gas from Russia. Deuterium gas, employed in heavy water reactors, was said to enhance the blast in nuclear explosions when combined with tritium. Russia has been the prime contractor of Iran's $1 billion nuclear power reactor at Bushehr.
Copyright ? 2004 East West Services, Inc.
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Blame Europeans for our centrifuges, defiant Tehran says
From combined dispatches
TEHRAN -- A defiant Iran yesterday said it had resumed building nuclear centrifuges, saying the move was retaliation for the failure of three European powers to get its file closed at the U.N. nuclear watchdog.
The announcement by Foreign Minister Kamal Kharrazi hardened the lines between Iran and the United States, which has been pushing to take Iran's nuclear program to the U.N. Security Council.
Mr. Kharrazi told a press conference that Iran has not resumed enriching uranium but was manufacturing centrifuges in response to the failure in June of Britain, Germany and France to help close Iran's file of nuclear nonproliferation violations at the International Atomic Energy Agency (IAEA).
"We still continue suspension on uranium enrichment, meaning that we have not resumed enrichment," Mr. Kharrazi said. "
But we are not committed to another agreement with [Britain, Germany and France] on not building centrifuges."
Diplomats said this past week that Tehran had resumed building equipment used to make uranium hexaflouride which -- when processed in centrifuges -- can be enriched to low levels for power generation or high levels for nuclear weapons.
Officials from Iran and the European powers are meeting in Paris, seeking to reach a consensus on Tehran's nuclear program.
The EU "big three" have given no details of their meeting Thursday but U.S. officials say Iran told them it would not surrender its right to proceed with uranium enrichment.
"The British and the French tell us Iran insists it will not back down on its right to proceed with enrichment," a senior U.S. official in Washington said Friday.
Another U.S. official, speaking on the condition of anonymity, told Reuters news agency that the Europeans were "not too happy" with the Iranian meeting.
"The EU three underscored their concerns and said [to the Iranians], 'Look, you're making a big mistake. You need to get back on the program,' " the U.S. official said.
"The fact that Iran just decided to back off its commitment took them by surprise and they weren't happy about it," he

added.
Secretary of State Colin L. Powell warned Iran on Thursday that its case was increasingly likely to be referred to the

sanction-imposing U.N. Security Council for failing to meet IAEA commitments.
Mr. Kharrazi said such comments were part of pressure to deprive Iran of its legitimate right to peaceful nuclear

technology.
"We just want to produce fuel for our plants and we are not after nuclear weapons," he said.
Washington says Iran's nuclear program is a cover for seeking atomic weapons. It has been lobbying for the IAEA to refer

Iran's nuclear file to the Security Council, which could impose sanctions.
The Paris talks prepare the ground for a September meeting of the board of governors of the IAEA, which is expected to

discuss Iran's program.
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Iran Says It Will No Longer Honor Nuclear Promises
Iranian Foreign Minister Kharrazi
31 July 2004 -- Iranian Foreign Minister Kamal Kharrazi said today
Iran will no longer honor commitments to the EU on achieving
transparency in the Iranian nuclear program.
Kharrazi said Britain, France, and Germany, negotiating on behalf of
the EU, "have not fulfilled their commitments towards Iran," and
Tehran does not see "any obligations to stick to them."
He confirmed Iran had resumed making parts for centrifuges used for
enriching uranium, but said Tehran is still committed to a
suspension of enrichment.
In October last year Iran agreed with the three European nations to
halt certain aspects of its nuclear program. In return, the
Europeans pledged to help Iran resolve its problems with the
International Atomic Energy Agency (IAEA), but judging that Iran had
not adequately cooperated, later sponsored a tough resolution
critical of Iran.
Officials from Iran and the three European states met in Paris this
week but issued no public statement.
(dpa/AFP)
Radio Free Europe / Radio Liberty ? 2004 RFE/RL, Inc. All Rights Reserved.
Contact us:
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Iran Says It Resumes Building Nuclear Centrifuges
Reuters
Sunday, August 1, 2004; 9:33 AM
By Parinoosh Arami
TEHRAN (Reuters) - Iran said Saturday it had resumed building nuclear centrifuges, which Washington says are intended to

enrich uranium to weapons-grade for use in bombs.
Iran's decision backtracks from a pledge in October to the European Union's "big three" members -- Britain, France and

Germany -- to suspend all uranium enrichment-related activities.
"We have started building centrifuges," Foreign Minister Kamal Kharrazi told a news conference.
However he insisted Iran had not resumed enriching uranium, the key part of the process which can either produce fuel for

power stations or bomb material.
Iran had previously said it would restart making centrifuges to retaliate against a resolution from the U.N. nuclear watchdog

last month deploring Tehran's failure to co-operate fully with inspectors from the International Atomic Energy Agency (IAEA).
Diplomats say Iran has also restarted work at a uranium conversion facility near the central city of Isfahan. The plant turns

processed ore, or yellowcake, into uranium hexafluoride gas which is pumped into centrifuges to form enriched uranium.
The EU "big three" have given no details of their meeting in Paris Thursday but U.S. officials say Iran told them it would

not surrender its right to proceed with uranium enrichment.
"The British and the French tell us Iran insists it will not back down on its right to proceed with enrichment," a senior U.

S. official in Washington said Friday.
Another U.S. official, speaking anonymously, said the Europeans were "not too happy" with the Iranian meeting.
"The EU three underscored their concerns and said (to the Iranians), 'Look, you're making a big mistake. You need to get back

on the program'," the U.S. official said.
"The fact that Iran just decided to back off of its commitment took them by surprise and they weren't happy about it," he

added.
The IAEA says the enrichment suspension was meant to cover both centrifuge construction and the uranium conversion plant.
ENRICHMENT NOT RESTARTED
However, Kharrazi gave assurances that Tehran had not resumed enriching uranium.
"Based on our agreements in October, we have accepted suspending uranium enrichment and we are continuing that suspension

based on our definition," he said.
Iran says enrichment activities only refer to the actual process of enriching uranium and argues it is free to continue work

on centrifuges and production of uranium hexafluoride gas.
It says the gas is then stored and not pumped into the centrifuges which spin at supersonic speed.
Iran insists it needs enriched uranium for power stations being built to meet booming domestic demand for electricity.
Secretary of State Colin Powell warned Iran Thursday that its case was increasingly likely to be referred to the sanction-

imposing U.N. Security Council for failing to meet IAEA commitments.
Kharrazi said such comments were part of pressure to deprive Iran of its legitimate right to peaceful nuclear technology.
"We just want to produce fuel for our plants and we are not after nuclear weapons," he said.
Washington says Iran's nuclear program is a cover for seeking atomic weapons.
(additional reporting by Carol Giacomo in Washington)
? 2004 Reuters
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Iran Refuses to Give Up Uranium Enrichment
By ALI AKBAR DAREINI
The Associated Press
Saturday, July 31, 2004; 2:38 PM
TEHRAN, Iran - A defiant Iran on Saturday said it had resumed building nuclear centrifuges, saying the move was retaliation

for the failure of three European powers to get its file closed at the U.N. nuclear watchdog agency.
The announcement by Foreign Minister Kamal Kharrazi hardened the lines between Iran and the United States, which has been

pushing to take Iran's nuclear program to the U.N. Security Council.
Kharrazi told a press conference that Iran has not resumed enriching uranium but was manufacturing centrifuges in response to

the failure in June of Britain, Germany and France to help close Iran's file of possible nuclear nonproliferation violations

at the International Atomic Energy Agency.
"We still continue suspension on uranium enrichment, meaning that we have not resumed enrichment," Kharrazi said. "But we are

not committed to another agreement with them (Britain, Germany and France) on not building centrifuges."
Diplomats said this week that Tehran had resumed building equipment used to make uranium hexaflouride which - when processed

in centrifuges - can be enriched to low levels for power generation or high levels for nuclear weapons.
In Paris talks, officials from Iran and the European powers are seeking to reach a consensus on Tehran's nuclear program.
Washington suspects Iran is using a civilian nuclear program as a cover for a secret nuclear weapons project. It has been

lobbying for the IAEA to refer Iran's nuclear file to the U.N. Security Council, which could impose sanctions.
The Paris talks prepare the ground for a September meeting of the board of governors of the IAEA, which is expected to

discuss Iran's program.
Kharrazi said the talks were designed to instill confidence that Iran is not seeking to make a nuclear weapon.
"We are holding these talks to reach further understanding and create more confidence in the direction that we are not

seeking nuclear weapons," he said. "At the same time, we will insist on our legitimate rights."
A prominent hard-line editor, Hossein Shariatmadari, wrote Saturday that the Paris talks may result in humiliation for Iran.
In an editorial in Kayhan, he predicted that America's European allies will produce a "silent overthrow" of the ruling

Islamic establishment in Iran, and that they would use the nuclear program as a lever to that end.
Shariatmadari is close to Iran's supreme leader, Ayatollah Ali Khamenei, who has the final say on all state matters.
Government officials were not immediately available for comment on Shariatmadari's remarks.
Hard-liners have urged the government to defy the IAEA, expel U.N. inspectors and resume uranium enrichment. The government,

though, has taken a more moderate approach in the hope of avoiding international isolation.
Iran maintains its nuclear program is for electricity generation.
Iran suspended uranium enrichment last year under international pressure. In return, Britain, Germany and France promised to

make it easier for Iran to obtain advanced nuclear technology.
? 2004 The Associated Press

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U.S. Defends Prospective Jordan Arms Deal
By BARRY SCHWEID
The Associated Press
Monday, August 2, 2004; 2:24 PM
WASHINGTON - The State Department defended a prospective deal to equip Jordan with high-tech air-to-air missiles and

cautioned Israel not to build 600 new homes at a large Jewish settlement on the West Bank alongside Jerusalem.
As Israel looks to Congress to block the deal to upgrade the firepower of Jordanian jets, department spokesman Adam Ereli

praised the Arab kingdom and said the United States would be careful to maintain Israel's military edge over the combined

forces of Arab nations.
"We certainly appreciate all that Jordan has done to contribute to regional stability, including its support for a stable,

secure and democratic Iraq, as well as its efforts to foster peace between Palestinians and Israel," he said in defense of a

weapons sale.
Jordan has fought alongside Arab nations in all the wars against Israel except the 1973 war. In 1996, under the late King

Hussein, Jordan signed a peace treaty with Israel.
This is the first time Israel has tried to prevent Jordan from buying U.S.-manufactured arms since the signing.
Ereli called the deal a potential one, and said the administration had not formally notified Congress of a plan to go ahead.
On another front, the State Department said the 600 housing units the Israeli defense minister has approved for Malleh Adumim

are a form of settlement activity that Israel promised to end when it approved a U.S.-backed road map for negotiations with

the Palestinians.
"We look forward to Israel abiding by that commitment and sticking by the road map," Ereli said.
Even expanding settlements to account for "natural growth" among the Jewish families that live on them is ruled out by the

road map, Ereli said.
American diplomats also have reminded Prime Minister Ariel Sharon that unauthorized outposts must be removed from the West

Bank, the spokesman said.
? 2004 The Associated Press

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Israel helped U.S. probe of major Muslim foundation
SPECIAL TO WORLD TRIBUNE.COM
Friday, July 30, 2004
FBI agents began arresting several officers of a major U.S. Islamic foundation on July 27, in the culmination of an investigation that U.S. government sources said was aided by Israel.
The sources said Israel provided the FBI and the Justice Department with records that traced the flow of funds from the Holy Land Foundation for Relief and Development to Hamas operatives in the West Bank and Gaza Strip.
A U.S. federal grand jury issued a 42-count indictment that accused Holy Land founder and six leading officers and fundraisers with funneling $12.4 million to Hamas, deemed a terrorist organization by the State Department.
The sources said the documents included those captured by Israel's military from Hamas and Palestinian Authority facilities in 2002 and 2003.
Until 2002, the foundation was regarded as the leading Islamic charity in the United States. In late 2001, President George Bush froze the assets of Holy Land in wake of the Al Qaida suicide attacks on New York and Washington.
"They had rewarded past and future suicide bombings and terrorist activities on behalf of Hamas," Attorney General John Ashcroft said.
On July 27, FBI agents arrested Holy Land founder Shukri Abu Baker and other former executives in raids around Dallas, Texas. Mohammed El-Mezain, the foundation's director of endowments, was arrested near his home in the San Diego suburb of Scripps Ranch. Two others charged -- Haitham Maghawri and Akram Mishal -- were said to have fled the United States.
Abu Baker was said to have been an agent for Mussa Abu Marzouk, a member of Hamas's Political Bureau and now based in Damascus. In 1992, Abu Marzouk helped launch Holy Land with $200,000.
FBI executive assistant director for counterterrorism John Pistole did not cite Israeli help. But he said federal authorities obtained "critical assistance from our foreign allies and partners" in the investigation of the Holy Land Foundation.
The government sources said Israel has made significant strides in understanding the money flow to Hamas and other Palestinian insurgency groups. They said a milestone was the Israeli military raid of the Arab Bank in Ramallah in February 2004 in which Israeli security officers seized documents on thousands of accounts, including those aligned with Hamas.
The federal indictment asserted that Abu Baker and other Holy Land executives transferred hundreds of thousands of dollars from the charity's accounts in Texas to Hamas loyalists in the West Bank and Gaza Strip. The indictment said the money flow -- used to pay operatives, inmates in Israeli prisons and the families of Hamas suicide bombers -- began in the 1990s and continued until the foundation's assets were frozen.
"In some cases, the defendants allegedly targeted financial aid specifically for families related to well-known Hamas terrorists who had been killed or jailed by the Israelis," the Justice Department said. "In this manner, the defendants effectively rewarded past, and encouraged future, suicide bombings and terrorist activities on behalf of Hamas."
The government sources said Israeli efforts against Palestinian insurgency financing began in 2002 after a military campaign in the West Bank turned up hundreds of thousands of Palestinian Authority and other documents that reported payments to Fatah and other operatives. The sources said Israeli authorities were urged by the United States to invest greater efforts in examining the money flow, particularly from foreign sources.
"In Israel we have over the last few years very much upgraded the way we track and deal with money transfers," Israeli embassy in Washington spokesman Mark Regev said
Copyright ? 2004 East West Services, Inc.

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Debunking
No Impropriety Found In Saudis' Exit Flights
By John Mintz
Washington Post Staff Writer
Saturday, July 24, 2004; Page A11
The Sept. 11 commission discounted a number of conspiracy theories that have been laid out in books, movies and magazine

articles asserting that the FBI and the Bush administration committed improprieties in allowing bin Laden family members and

other Saudis to jet back to their country in the days after the 2001 terrorist attacks.
In "Fahrenheit 9/11," filmmaker Michael Moore left the strong impression that the chartered bin Laden family flight, arranged

by the Saudi Embassy in Washington because of concerns for their safety, occurred while civil aviation was grounded after the

attacks. He also said the FBI did not properly interview the departing bin Ladens.
Author Craig Unger, in the book "House of Bush, House of Saud," also accused the FBI of only cursorily checking on bin Laden

family members before letting them fly out of the country on Sept. 20. In addition, he said that even though civil aviation

was allowed to resume on Sept. 13, 2001, federal authorities still limited the operation of private planes in this country,

and he raised suspicions about the approval for the bin Laden flight.
In their report, released Thursday, the commissioners found nothing amiss in U.S. officials' decision to allow the nine

chartered flights between Sept. 14 and 24 that carried 160 people, mostly Saudi nationals, to the desert kingdom. The report

also concluded that FBI officials properly interviewed almost all the bin Laden family members, who were on one flight that

departed Sept. 20, seven days after the grounding was lifted.
"We found no evidence that any flights of Saudi nationals . . . took place before the reopening of national airspace on the

morning of September 13," the commission said. It added that it found "no evidence of political intervention" to allow the

flights, noting that the highest-ranking official to sign off on them was then-White House counterterrorism chief Richard A.

Clarke.
"We believe that the FBI conducted a satisfactory screening of Saudi nationals who left the United States on charter

flights," the commission added. In details scattered over four pages of text and footnotes, the panel said the FBI

interviewed "all persons of interest" on the flights, concluded that none was connected to the attacks and has "found no

evidence to change that conclusion."
FBI officials kept close tabs on the Sept. 20 flight as it stopped in five U.S. cities to pick up bin Laden family members

before leaving for Saudi Arabia. Twenty-two of the 26 people on board were interviewed by the FBI, and "many were asked

detailed questions," the report said.
The bureau had more opportunity to get information from them than it ordinarily would have, the commission said, because the

U.S. government does not routinely run checks on foreigners leaving the country. Collecting them in one location was

fortunate for the FBI, because it could not have talked to them if they had simply left on regular commercial flights, it

added.
Unger said he still thinks the FBI failed to adequately interview the bin Ladens and suspects that the Saudis received

special treatment because authorities had grounded some private planes during that same period.
Joanne Doroshow, an associate producer of "Fahrenheit 9/11," said Moore did not intend to suggest that the bin Ladens flew

away while civilian flights were grounded. She added that the filmmakers still harbor suspicions about the FBI interviews.
"We don't know who was interviewed and what questions were asked," she said.
? 2004 The Washington Post Company
-----------------------------------------------------------------------------------

Islamic groups hit curriculum at Saudi school
By Christina Bellantoni
THE WASHINGTON TIMES
Two Islamic groups say a private Saudi school in Alexandria is teaching first-graders an extreme version of Islam that

fosters contempt for other religions, a charge denied by the Saudi government, which creates curriculum for such schools.
The Council on American-Islamic Relations (CAIR), a District-based Islamic civil rights and advocacy group, has joined

with the Free Muslim Coalition Against Terrorism in calling for an Arabic textbook to be removed from classes at the Islamic

Saudi Academy.
One page in the manual for the first-grade textbook instructs teachers to tell students that any religion other than

Islam is false.
"These first-grade students are very impressionable," said Kamal Nawash, a Palestinian and practicing Muslim who runs the

six-month-old Free Muslim Coalition Against Terrorism.
"The extremist version of Islam encourages violence. We don't need to be teaching that anymore in this diverse world. We

need to teach people to get along."
The Islamic Saudi Academy referred inquiries to the Saudi Embassy, which dismissed Mr. Nawash's assertion as an attempt

to restart a failed political career.
Embassy spokesman Nail Al-Jubeir compared the textbook to any other religious teaching and said it was "shameful" of Mr.

Nawash "to be using this as a source of bigotry."
"They are making a big thing out of nothing," Mr. Al-Jubeir said. "If that's the only thing they have to bring up, how

pathetic the argument is. Judaism does not recognize Christ as the Messiah. Christians say the only way to salvation is

accepting Christ in your heart."
CAIR spokesman Ibrahim Hooper said the textbook page conflicts with the teachings in the Koran, which says Jews,

Christians and all "who believe in God" will "have their reward with their Lord."
"The [page of the] textbook is inaccurate in terms of portraying Islam's relationship with other faiths," Mr. Hooper

said. "I would suggest either removing the textbook or inserting a notation that something is being changed in the textbook."
Mr. Nawash began a campaign this week criticizing the school. CAIR studied the textbook page and backed his stance.
According to the academy's Web site, its educational curriculum and materials are established by the Saudi Ministry of

Education.
"We strive to educate and develop every aspect of a student's life, including spiritual, moral, intellectual, and

physical," the site states. "Simultaneously, the Academy aspires to create an atmosphere that motivates students to strive

for academic excellence, take personal responsibility, and become productive citizens in their communities."
A few years ago, Mr. Nawash said, the Saudi government revised 5 percent of its textbooks and classroom material

considered offensive. Mr. Nawash thought that the Islamic Saudi Academy's materials had been edited, but he found the

disputed page recently in the 2003 edition of the school's manual for first-grade teachers.
Mr. Al-Jubeir suggested that Mr. Nawash is taking advantage of recent attacks on Saudi Arabia by filmmaker Michael Moore

in "Fahrenheit 9/11" and by others. Mr. Al-Jubeir also suggested that Mr. Nawash is criticizing the school for political

gain.
Mr. Nawash, a Republican immigration lawyer from Falls Church, tried unsuccessfully to unseat state Sen. Mary Margaret

Whipple, Arlington Democrat, in 2003. He received 30 percent of the vote, and Mrs. Whipple was elected to a third term.
He also ran unsuccessfully for the state House of Delegates in 2001.
But Mr. Nawash said he has no intention of running for office again and that his only motive is to stop extremist

teaching that he fears will lead to terrorism.
"This is much more important, and it should have been done a long time ago. There is a strong movement of people pushing

extremist Islam that tolerates any means, including terrorism, to meet their goals," he said. "It's not a handful, it's a

worldwide uprising. ... We're not staying silent anymore."
This is not the first time Mr. Nawash has been under scrutiny.
His law firm once represented Abdul Rahman al-Amoudi, a prominent U.S. Muslim leader who had a role in a Libyan

conspiracy to assassinate Saudi Crown Prince Abdullah. Al-Amoudi on Friday pleaded guilty to illegal financial transactions

with Libya and admitted his role in the plot.
Al-Amoudi had donated $10,000 to Mr. Nawash's campaign for the state Senate. Mr. Nawash returned the donation.
When asked whether he was friends with al-Amoudi, Mr. Nawash refused to comment.
"I was part of a law firm that represented him," he said. "I can't really comment on that. One of the attorneys in the

firm represented him for a short time."
Al-Amoudi's current attorney, Stanley Cohen, said Mr. Nawash's firm has had "nothing to do" with the case for 10 months.
In defending his position, Mr. Hooper cited the teachings of the prophet Muhammad in the Hadiths: "Both in this world and

in the Hereafter, I am the nearest of all people to Jesus, the son of Mary. The prophets are paternal brothers; their mothers

are different, but their religion is one."
*Jerry Seper contributed to this report.

------------------------------------------------------------------------------------------
Kuwait Bans 'Fahrenheit 9/11'
By DIANA ELIAS
The Associated Press
Sunday, August 1, 2004; 10:39 PM
KUWAIT CITY - Kuwait, a major U.S. ally in the Persian Gulf, has banned Michael Moore's "Fahrenheit 9/11" because it deems

the movie insulting to the Saudi Arabian royal family and critical of America's invasion of Iraq, an official said Sunday.
"We have a law that prohibits insulting friendly nations, and ties between Kuwait and Saudi Arabia are special," Abdul-Aziz

Bou Dastour, cinema and production supervisor at the Information Ministry, told The Associated Press.
He said the film "insulted the Saudi royal family by saying they had common interests with the Bush family and that those

interests contradicted with the interests of the American people."
The ministry made the decision to bar "Fahrenheit 9/11" in mid-July after the state-owned Kuwait National Cinema Co. asked

for the license to show the movie. The company monopolizes cinemas in Kuwait, but all movies must first be sanctioned by

government censors.
"Fahrenheit 9/11," which won the top honor at May's Cannes Film Festival, depicts the White House as asleep at the wheel

before the Sept. 11, 2001, attacks in New York and Washington. Moore accuses President Bush of fanning fears of future

terrorism to win public support for the Iraq war.
The Saudi royal family has taken issue with the movie for claiming that high-ranking Saudi nationals were allowed to flee the

United States immediately after the attacks at a time when American airspace had been closed to all commercial traffic.
The 9/11 commission investigating the 2001 terrorist attacks found no evidence that any flights of Saudi nationals took place

before the reopening of national airspace on Sept 13.
Kuwait was the launch pad for the war that unseated Iraqi dictator Saddam Hussein, who ordered the invasion of Kuwait 14

years ago. A U.S.-led coalition fought the first Gulf War, which evicted Iraqis after seven months of occupation.
Saudi Arabia, a leading Arab Muslim nation, opened its land and air space to coalition forces that liberated Kuwait, and

Kuwaitis are still grateful for that.
The film is already playing elsewhere in the Middle East, including the United Arab Emirates and Lebanon.
? 2004 The Associated Press


---------------------------------------------------------------------------
We are a trillion times closer to Europe
By Neil Collins
(Filed: 02/08/2004)
Golly, what a lot of money. A trillion pounds is enough to make your head spin. How on earth will we ever repay it? The

simple answer is that we can't, and if we really set out to do so, the consequences would be little short of catastrophic.
Debt is one reason why capitalism works. It allows the younger, economically active members of the population to buy things

they cannot afford, while the interest rewards the owners of the capital, whose economically productive days are behind them.

Both sides benefit, so stop worrying about all those zeros in the headlines last week. There's no more significance to our

debt passing 1,000,000,000,000 than there is to your car passing 100,000 miles; properly maintained, there's no reason why it

shouldn't go on.
You noticed the little caveat, didn't you? Skimp on the maintenance, and the car breaks down. Skimp on servicing debt, and

your entire life breaks down. Interest becomes payable on the interest, and can swiftly overwhelm the unwary, which is why we

love to spook ourselves with the thought of all that debt overhanging us.
In fact, it's a lot less threatening than it looks. For a start, ?55 billion is on credit cards, and much of that isn't

borrowing at all in any meaningful sense. We use credit cards for convenience. Unless there's some special zero interest

deal, most of us pay off the balance on the card in full each month. That much, at least, of the trillion-pound debt mountain

merely reflects spending that might otherwise be paid for in cash or cheque.
The vast bulk of the money has gone, as you'd expect, on property - ?827 billion, according to the figures. The cash has

pumped up the housing market, and buyers have got sick of being told that it's all going to end in tears, only to see the

prices rise still further beyond their reach. No reader of The Daily Telegraph needs a rehearsal of the factors that have

driven the housing boom, and this week the Bank of England is almost certain to try to apply the brakes by raising interest

rates by another quarter-point.
A cheerful little analysis from Stephen Roach, economist at Morgan Stanley, speaks of a global property bubble, pumped up by

the ultra-low interest rates that followed the "deflation scare" (remember that?) of early 2003. He puts Britain second only

to Australia in his estimate of how bubbly, so to speak, our housing market has become. Not that the Brits and Aussies are

the only ones blowing bubbles - he reckons that home values in countries representing two thirds of the world's economy are

either overheating or in danger of doing so.
Rather than sell up and move into a caravan, the smart British buyer might look to see which parts of the world are excluded.

He won't have to look far. House prices in euroland are still pretty reasonable - by British standards, they are often

laughably cheap. A few hours from the Channel Tunnel, and not only are the food and weather better, but property prices seem

stuck in the early 1990s.
The growth of cheap air travel is producing pockets of British-owned real estate all over Europe. Small farmers, exhausted by

the unequal struggle with EU regulations, are happy to sell their dilapidated, pretty houses to the mad English, and move

into some ugly but comfortable eurobox.
Overseas is where a small, but rapidly increasing proportion of the cash raised from that trillion pounds of debt is going,

and is another reason not to worry. Britain used to have an unexploited source of foreign exchange under the North Sea; now

that the oil is beginning to run down, we can see that we haven't wasted it after all. The dollars have gone into buying

assets abroad, from shares in foreign companies for the pension funds, to continental homes for the middle classes.

Considering that much of the North Sea output was sold when oil prices in real terms were a lot higher even than they are

today, it's a satisfactory trade.
Which brings us to Abbey National. As its 1.7 million shareholders know, it's likely to be taken over by a Spanish bank

called Santander. They are being offered Spanish shares which they won't want, and on pretty measly terms, too. The

interesting thing about this takeover, though, is the potential for a British high street bank to have a direct line into the

Spanish housing market.
Just think of the possibilities. Locate an Abbey branch (they are hard to spot in the high street since the bank's new

management dispensed with the National, along with its familiar red and white roof symbol, and paid a fortune for some fuzzy,

khaki-coloured new logo) and they'll arrange the mortgage, on the finest terms, to buy into
Little Britain in Marbella. Being big and local, Santander will be able to help you avoid those Spanish property horror

stories. It claims to like its retail customers, unlike the British banks.
A fantasy? Perhaps. There's no evidence that Santander's thinking has got beyond a perverse enthusiasm to get into the

crowded British banking market, but Spanish mortgages and euro accounts offered through the Abbey seem obvious next steps.

Our appetite for property is likely to survive a modest fall in prices, and as Labour turns up the tax heat under the middle

classes, a foreign bolthole becomes ever more appealing.
We may hate the idea of joining the single currency, or the empty political mantra about being at the heart of Europe (as if

Brussels could ever be the heart of anywhere) but when it comes to voting with our own money, a trillion pounds says the

British are the biggest buyers of europroperty. You might call it Ever Closer Union with Europe.
? Copyright of Telegraph Group Limited 2004.
-------------------------------------------------------------------------------
Kyodo: China Wants Nuclear Talks in August
VOA News
02 Aug 2004, 10:37 UTC
Japan's Kyodo news agency says China has asked parties to six-way nuclear talks about the possibility of holding working-

level discussions August 17 to 20.
The news agency quotes sources close to the talks who say they would be held in Beijing, where three other rounds of high-

level talks have taken place without much progress. Participants are trying to find a solution to the controversy over North

Korea's nuclear development program.
Neither Japanese nor Chinese officials have confirmed the report, which comes as China's special envoy on North Korea began

discussions in South Korea on new six-way talks. Ning Fukui met with his South Korean counterpart Cho Tae-yong to fine-tune

an agenda for the planned discussions.
Japan, China, the two Koreas, Russia and the United States agreed in June at the last round of talks in Beijing to meet again

by the end of September.
Some information for this report provided by AFP and Reuters.
----------------------------------------------------------------------------------


Asia Pacific North Korea Reportedly Suffers Severe Crop Damage
Steve Herman
Tokyo
02 Aug 2004, 11:51 UTC
Listen to Steve Herman's report (RealAudio)
Herman report - Download 267k (RealAudio)
North Korea's official news agency, in a rare report on a natural disaster, is warning of severe damage to crops in the

impoverished country from torrential rains last month.
The Korean Central News Agency says heavy rains have swamped at least 100,000 hectares of cropland and more than a 1,000

homes have been flooded, mainly in the southern and central part of the country.
That would be about four percent of North Korea's arable land.
The state-run news agency adds the damaged fields are unlikely to produce a crop this year.
International aid organizations in Pyongyang, as well as officials in Seoul, said that as of Monday, they had not been asked

for additional help by the North.
Richard Ragan, director of the World Food Program's office in Pyongyang, says North Korea's early wheat and barley crop

received too much rain right before the harvest.
"What may be impacted most significantly at this point is the seed crop - what they would use for planting material next

year," he said.
UNICEF representative Pierrette Vuthi in Pyongyang traveled to the northern part of the country last week where the situation

appears not to be as dire.
"There were some roads that were cut off but it wasn't major flooding because the fields looked good," said Mr. Vuthi. "I'm

not aware of any major flooding in the south of the country because I haven't been there and I haven't heard of a major flood

situation."
Mr. Ragan says North Korea is becoming more open about reporting disasters, and this latest dispatch means "there could

certainly be a significant problem" with this year's harvest.
North Korea suffered a famine in the mid-1990's, and now relies on foreign aid to feed about one-fourth of its population of

22 million. Its primary donors are South Korea, Japan, China, Russia and the United States.
Some countries, especially Japan and the United States, have cut back donations over the past few years, because of disputes

with Pyongyang over its nuclear weapons programs and its kidnapping of Japanese citizens in the past.
The World Food Program's Mr. Ragan says 35,000 tons of Russian wheat just arrived in North Korea a few days ago.

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

Outside View
Avoiding the Saddam-Kuwait Model in Taiwan
Posted July 26, 2004
By M.D. Nalapat
During his decadelong battle with Iran, Saddam Hussein was the recipient of support from the United States as well as from

such countries as the United Kingdom, which did not want to see a Khomeinists theocracy dominate the Persian Gulf.
Those in India who were in contact with the deposed president of Iraq and his advisers say that the belief among them was

that the United States would not intervene to reverse a takeover of Kuwait, provided that the Iraqi forces did not carry the

campaign forward into Saudi Arabia.
Former U.S. ambassador April Glaspie's ambiguous response to Saddam Hussein a short while before the decision to invade was

taken was only one of a series of similar messages relayed to the dictator during that period. Soon afterward, Saddam took

over Kuwait, and got thrown back -- and, after another decade, out -- by the United States.
Within the higher levels of the Chinese Communist Party, a similar debate is now going on about Taiwan.
Will Washington really intervene to reverse a takeover by the People's Republic of China (PRC), or will the United States

simply indulge in some saber rattling, impose a trade embargo for a while, and then get back to business as usual with

Beijing?
The Chinese Communists look at societies holistically, not separating out the different strands but conceptually weaving them

into a unified entity with a common decision core. Hence, "casual" remarks from businesspersons or academics known to have

close personal ties with senior administration officials are given the same attention as official statements, sometimes more.
Despite the initial Bush administration rhetoric about the PRC being a strategic competitor rather than a partner, there has

been a growing flow of officials, businesspersons and academics into Beijing who assure those they meet that Washington would

shy away from the immense disruption caused by a war with Beijing. In such remarks, Taiwan becomes the 21st-century version

of 1930s Czechoslovakia, "a small, faraway land of which we know nothing," in the words of the then British Prime Minister

Neville Chamberlain.
These officials justify their Glaspie-like comments by claiming that the hardheaded Chinese Communist leadership would not

risk economic ruin by invading Taiwan and that the creation of prosperity is the cornerstone of the unwritten compact that

has thus far kept the Chinese people from seeking to overthrow the unelected elite that rule their country. In a sense, such

"economist" reasoning is similar to that which was used to justify the post-Desert Storm sanctions on Iraq.
The group that ran Baghdad -- Saddam Hussein, his sons and relatives, and their friends -- cared little for the sufferings of

the people of Iraq. Indeed, they used the hardship caused by the sanctions to demonize the United States, Britain and the

other powers that were insistent on them, thus gaining legitimacy as fighters for freedom from such oppression.
The external enemy -- and the new U.S. envoy to Iraq, John Negroponte, was among the more visible public faces of this -- was

seen as seeking "to starve the Iraqi people into submission." Thus, the anger against Saddam began to get diverted into

channels that fueled anger against the countries backing the sanctions.
While the population of Iraq starved, those around Saddam enjoyed a royal lifestyle. In the same way, the elite of the

Chinese Communist Party will continue to enjoy a regal lifestyle even should a trade embargo result in widespread loss of

jobs.
In the same way the sanctions in Iraq did not either deter Saddam's clique from holding on to power and to their policies,

nor create the conditions for a revolt against the regime, the economic hardship caused by a possible U.S. trade embargo on

the PRC will be used to whip up nationalist sentiment that paradoxically will strengthen the Chinese Communist Party's

support.
Unless the loss of jobs is caused by domestic policies rather than by external sanctions, politically the negative effects on

Communist Party rule will be slight. Hence, fears that Wal-Mart will stop outsourcing from China are not going to deter the

higher communist leadership from attacking Taiwan, especially in a context where several key trading blocs, including South

Korea, the Associaton of South East Asian Nations (ASEAN) countries, the Mideast and quite possibly several countries in

Europe, are unlikely to join in such sanctions. And Chinese veto will ensure that they do not have the legitimacy of a U.N.

Security Council resolution.
The leadership in Beijing will batten down the hatches and wait for Washington to "accept the inevitable," as it did on Tibet

and on Tiananmen Square. This, of course, presumes that the United States will not go to war with China over Taiwan.
Even were there war, Chinese diplomacy has been in overdrive to ensure that Washington fights alone. Today, only a Koizumist

Japan is likely to join forces with the United States in attempting to reverse a PRC takeover of Taiwan.
South Korea has been neutralized, as has most of ASEAN. Even Australia is now going through a debate as to whether

intervention in a cross-strait conflict would serve Canberra's long-term interest. Beijing has been working actively in

Europe as well to ensure that the European Union joins such huge neighbors of China as Russia and India in sitting out a war

between the United States and China across the Taiwan Straits.
The planners in Beijing will be calculating that the United States may, especially after Iraq, hesitate to go it alone,

especially against an enemy as formidable as the PRC.
In material terms the United States has preponderant power even in the region of the China seas. The fact that the lines of

communication of U.S. forces stretch back thousands of miles, as against the Chinese Communists, who will be operating from

their own backyard, will act as a disincentive for war.
In the United States, as in the European Union, there has emerged a group of scholars who are analogous to those who

researched the former Soviet Union in the days of the Cold War. The latter refused to give credence to claims that the system

in Moscow was suffering from dry rot. Almost until the end of the 1980s, they persisted in assuming that the Soviet Union

would survive into the indefinite future. In much the same way, the community researching on China is making several

assumptions that may be incorrect, such as that "there is no ideology within the Chinese Communist Party."
While it is true that the Chinese Communists have little patience with Marxism-Leninism (and since Deng Xiaoping, even with

Maoism), the reality is that the party theoreticians have crafted a coherent ideology that has Western-style democracy and

the United States as the enemy. The contempt for democracies, whether in India or in Taiwan, is explicit, as is the

presumption that only an Asia "cleansed" of U.S. influence will be truly free.
Thus, what has replaced orthodox Marxist theory in the Communist Party in China is not a vacuum but a new ideology that has

incorporated the old one's contempt for, and enmity toward, Western-style democracy and its most powerful expression, the

United States.
Finally, those that complacently assume that Beijing will follow the same trajectory as Moscow are glossing over the fact

that while the Soviet Union was a status-quo power, intent only on protecting what was won by it as a result of World War II,

China is actively seeking a change in the status quo.
What Beijing seeks is to replace the United States with itself as the primary power in Asia, an objective that its diplomats

do not bother to conceal in Southeast Asia, and increasingly in the Middle East as well. In Europe, the PRC is firmly on the

side of "Old Europe," boosting the French and the Germans as they seek to delink Europe from U.S. leadership.
Apart from the unlikely event of Taiwan declaring formal independence, the prospects for a war will rise in proportion to the

degree of internal instability in China. The new regime headed by President Hu Jintao is seeking to dismantle the old

economic structure dominated by manufacturing, replacing it with one that incorporates modern sectors such as biotech,

information technology and space at its core. This could involve the loss of hundreds of thousands of jobs, and consequent

unrest. Should such instability spiral upward to levels beyond the capacity of the security infrastructure to cope with, a

war over Taiwan could become the ultimate antiriot weapon, once again uniting the Han population behind the Communist Party.
The potential for conflict has become higher as a result of the unique situation China finds itself in today when, for the

first time since Lin Biao in the 1960s, the party no longer seems to be in control of the gun. Former President Jiang Zemin

is using his chairmanship of the Central Military Commission to carve out a space independent of the Chinese Communist Party,

a process that could lead to a rise in the influence of the men in uniform over policy not seen since Lin's time.
When combined with the essential defenselessness of Taiwan (there is no defense as effective as strong offensive capability,

an option the United States has denied Taiwan), the prospects for a miscalculation on the Saddam-Kuwait model are growing.

Rather than seek to wish it away, Washington needs to face up to the reality that it could be at war with China within a

decade, face up to this as energetically as the PRC itself is doing with its crash program of military modernization and

refinement of asymmetric warfare against a "more powerful enemy." No prizes for guessing who that enemy is.
M.D. Nalapat is director of the School of Geopolitics of the Manipal Academy of Higher Education in India. United Press

International's "Outside View" commentaries are written by outside contributors who specialize in a variety of issues. The

views expressed do not necessarily reflect those of United Press International, a sister news organization of Insight.
Copyright ? 1990-2003 News World Communications, Inc.

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


Iranian Dissident Professor Released on Bail
VOA News
31 Jul 2004, 13:26 UTC
AP
Hashem Aghajari, acompanied by policeman and a security person as they exit from a session of his court in Tehran, Iran
Iranian dissident Hashem Aghajari greeted family and friends at his home in northern Tehran Saturday, just hours after being

freed from prison on bail.
Defying a court order that he not speak to the media, Mr. Aghajari told supporters outside his home that he hopes "there will

come a day when no one goes to prison in Iran for his opinions, let alone be sentenced to death."
The professor was jailed nearly two years ago and sentenced to death for saying Muslims are not "monkeys" and should not

blindly follow their leaders. But in a retrial, the court instead gave him a five-year jail term, as well as five years of "

deprivation of social rights."
An Iranian court ordered the academic's release on $112,000 bail as he awaits a final ruling on his case by the Supreme

Court.
Some information for this report provided by Reuters and AP.
-----------------------------------------------------------------------------------------
Iran: Dissident Lawyer Gets Prison Furlough
VOA News
28 Jul 2004, 15:21 UTC
An Iranian lawyer sentenced to five years in prison following his involvement in a high-profile case known as the "serial

murders" has been granted a brief prison furlough.
The attorney for lawyer Naseer Zarafshan told VOA's Persian service Wednesday that his client has been freed for 48 hours. It

is his first furlough in nearly a year.
International human rights groups say a secret military tribunal sentenced Mr. Zarafshan in March 2002 to five years in

prison and 70 lashes for disseminating state secrets and possessing firearms and alcohol.
His advocates say he is innocent and his sentence is retribution for his criticism of an official investigation into the

murders of several writers and activists in 1998, known as the "serial murders." Mr. Zarafshan also represented two of the

victims' families.

-----------------------------------------------------------------------------------------
Four French Guantanamo Detainees Placed Under Investigation
VOA News
31 Jul 2004, 19:49 UTC
A French anti-terrorism judge has formally placed under investigation four French men released from the Guantanamo Bay naval

base in Cuba.
Another judge will decide whether to release Nizar Sassi, Brahim Yadel, Mourad Benchellali, and Imad Kanouni during the

investigation or hold them in custody. The decision to investigate is one step away from formal charges against the men for

alleged connections to Afghanistan's terrorist-linked Taleban regime.
The four were handed over by U.S. authorities this week following intensive negotiations between Washington and Paris.
Three other French citizens remain at Guantanamo, which holds about 600 prisoners suspected of having ties to the Taleban or

the al-Qaida terrorism network. Most were arrested in Afghanistan in 2001.
Some information for this report provided by AFP, AP and Reuters.
--------------------------------------------------------------------------------------------
Venezuela Orders Arrest of 59 Military Officers
VOA News
01 Aug 2004, 14:49 UTC
A Venezuelan court has ordered the arrest of 59 military officers who protested against President Hugo Chavez nearly two

years ago.
The judge in Caracas said Saturday the officers had failed to appear at proceedings to face charges of conspiracy, rebellion

and inciting insurrection.
There was no immediate comment from the officers, some of whom have gone into hiding.
The officers on trial are among a group of about 100 military personnel who declared themselves in rebellion in October 2002.
Some of the officers have also been accused of taking part in a 2002 coup attempt against President Chavez.
Saturday's arrest order comes two weeks before a referendum on whether to remove Mr. Chavez from office.
Some information for this report provided by AFP and AP.
--------------------------------------------------------------------------------------------
Venezuela Says Explosives Stolen from Military Base
VOA News
31 Jul 2004, 02:26 UTC
Venezuelan officials say more than 60 kilograms of a powerful explosive have been stolen from a military base.
In Caracas Friday, Interior Minister Lucas Rincon said the government fears the C-4 plastic explosive may be used for attacks

leading up to the August 15 recall referendum of President Hugo Chavez.
Political opponents have accused the Chavez administration of trying to scare voters away from the polls. Opposition leaders

who organized the recall charge Mr. Chavez is trying to model the nation after Communist Cuba.
Mr. Chavez, who says his policies are aimed at helping the poor, has vowed to defeat the recall.
Some information for this report provided by AP and AFP.
----------------------------------------------------------------------
Chavez Tightening Grip on Judges, Critics Charge
Venezuelan President's Reforms Called Threat to Rule of Law, Attempt to Undermine Recall Effort
By Kevin Sullivan
Washington Post Foreign Service
Sunday, June 20, 2004; Page A24
CARACAS, Venezuela -- Judge Miguel Angel Luna said he was sitting in his courtroom on Feb. 28 when prosecutors brought in two

beer-truck drivers, who had been parked near an anti-government demonstration, and demanded that they be jailed.
But there were no charges against them, Luna recalled. So he set the two men free. Three days later he was fired by the

president of the Supreme Court without explanation.
"The regime of President Hugo Chavez has turned our democracy into an autocracy," said Luna, 58, who has returned to his

private law practice and believes that his only offense was to defy the political wishes of the president and his supporters.

"Judicial autonomy has been lost, and that is the foundation of democracy."
Luna's case illustrates how politics has eroded the judicial system, threatening the rule of law in one of the world's most

important oil-producing nations. The loss of judicial autonomy could affect an Aug. 15 national referendum on whether to

recall Chavez, according to political and legal analysts in Venezuela and a report released last week by the New York-based

organization Human Rights Watch.
The Chavez government presides over a judicial system where most judges can be fired at will. The National Assembly has also

just passed a law that will allow Chavez and his allies to pack the supreme court with sympathetic justices who could end up

deciding any challenges to the recall election, analysts said.
The government argues that it is cleaning up a corrupt and inefficient judiciary it inherited when Chavez was elected in

1998, and trying to rein in the anti-Chavez groups who backed a coup in April 2002 and a strike at the national oil company

last year that cost the country billions of dollars. The justice system in Venezuela has historically been corrupt and Chavez

fired hundreds of judges immediately after his election, a purge that was widely seen as necessary.
But critics said Chavez, a former paratrooper who led a failed coup in 1992, had gone beyond the changes needed to reform the

judiciary. They said he was trying to silence dissent and create an authoritarian government in the style of Fidel Castro's

Cuba.
"This is a political assault on the judicial system," said Pedro Nikken, a constitutional lawyer in Caracas. "It's making the

judiciary a branch of the executive. They are going to use this to attack the dissidents and guarantee the impunity of any

abuses of human rights or acts of corruption by the government."
In its report, Human Rights Watch said the "most brazen" challenge to the rule of law in Venezuela was a new statute pushed

through the National Assembly by Chavez allies last month that expands the Supreme Court from 20 to 32 justices and allowed

the Chavez-dominated assembly to fire and hire justices with a simple majority vote. Previously, firing a justice required a

two-thirds majority.
The report said the new law amounted to a "political takeover" of the court. It said the law would allow Chavez and his

allies to "pack and purge the country's highest court," which is currently split 10 to 10 between judges seen as loyal to

Chavez and those viewed as his opponents. The report called on the Organization of American States to investigate.
"We are not talking about what could happen, we are talking about what is already happening," Jose Miguel Vivanco, head of

the group's Americas division, said at a news conference. He noted that on Wednesday pro-Chavez legislators voted to fire one

Supreme Court justice and to begin proceedings to suspend two more. All three were widely seen as opponents of Chavez and had

ruled against his wishes in recent high-profile cases.
Only 20 percent of Venezuela's 1,732 judges have tenure and job security; the rest are either provisional or temporary judges

who can be fired at will by the Supreme Court's six-member administrative council, the report noted.
The Chavez government responded to the report with ferocious rhetoric
The National Assembly's leadership said it would consider declaring Vivanco a "persona non grata" in Venezuela. Vivanco said

he was detained briefly by federal political police at the Caracas airport as he left the country Saturday morning, which he

described as an act of harassment and intimidation. Assembly President Francisco Ameliach Orta, quoted in local media, said

the report reflected "total and absolute ignorance" and accused Human Rights Watch of "open and unpardonable meddling in the

internal affairs of our country." He said the Supreme Court overhaul was passed by the National Assembly and represented the

will of the majority of the Venezuelan people.
Tarek William Saab, a key Chavez ally in the Assembly and head of the Foreign Relations Commission, said in an interview that

critics failed to give the government credit for its efforts to "create an autonomous and independent judicial branch" and

put an end to the "enormous impunity" that existed before Chavez took office.
Saab said it was wrong to say that Chavez controlled the judiciary. If he did, Saab said, the leaders of the 2002 coup

against Chavez and those who led the oil company strike would be in jail. "They have not been put in jail because of the lack

of ethics on the part of judges linked to the opposition," Saab said.
Still some analysts, including Alberto Arteaga Sanchez, a noted criminal attorney in Caracas, said Chavez and his allies were

"using criminal law against their political adversaries."
One of Arteaga's clients is an army general who was involved in the 2002 coup against Chavez. Arteaga said the Chavez

government had proposed an overhaul of Venezuela's criminal code that called for up to six years in jail for "publicly or

privately instigating disobedience of the laws or hatred among citizens." Arteaga said even a private discussion among

friends could result in prison time.
The reform calls for up to five years in jail for "causing panic" by disseminating "false information," even by e-mail. And

it would jail anyone who "simply intimidates" or "pressures" public servants. Arteaga and Nikken said that would include the

habit of harassing public officials by "casseroling" them: annoying them by banging a spoon loudly against a pot.
"This government is starting to show signs, like we saw in Cuba, of criminalizing political dissidence," said Nikken, noting

that last year the Cuban government sentenced 75 non-violent dissidents, including journalists and librarians, to long prison

terms.
Potential political influence in the judicial system is especially critical now because of the recall referendum scheduled

for Aug. 15. After years of trying to oust Chavez, first by coup and then through the oil strike, his opponents finally

managed to gather enough signatures on petitions to force the recall vote.
Noting that Venezuela is deeply and passionately divided between those who support and those who oppose Chavez, Vivanco

predicted that the referendum could be so close that it may ultimately be decided by the country's high court, just as the U

.S. presidential election in 2000 was by the Supreme Court. Vivanco said it was critical that the court not be stacked with

justices acting solely for political reasons.
Luna, the fired judge, filed a written appeal and was reinstated on April 15. But three weeks later he presided over a

procedural hearing involving the case of another Chavez opponent. Following standard practice, Luna granted the man's request

to allow two new attorneys to represent him. A week later, he was again fired.
Luna said he was one of nine children of a small-town merchant and the only person in his family to graduate from college. He

said he worked as a lawyer for almost 25 years before becoming a judge four years ago. He said he had never been an opponent

of Chavez. A soft-spoken man with gray hair and glasses, Luna said he was sad that his career on the bench had ended because

of "pure revenge."
"We are waiting for the recall election to change our direction," he said, "to take us toward a horizon of peace and democracy in Venezuela."
? 2004 The Washington Post Company


---------------------------------------------------------------------
>> GAMES...AHA

Display of might shows who is in charge
Jonathan Watts in Beijing
Monday August 2, 2004
The Guardian
Thousands of People's Liberation Army (PLA) troops paraded in Hong Kong yesterday in an unprecedented display of military power aimed at drumming up patriotism and reminding opposition democrats who is boss of the territory.
The show of force comes amid a sharp change in the political climate on the island, which has recently experienced its biggest anti-government demonstrations and greatest concerns about free speech since the transfer from British rule in 1997.
To mark the 77th anniversary of the PLA, spectators were invited into the Hong Kong garrison, where the entire force of 3,000 green-uniformed soldiers and 28 armoured vehicles marched and drove around the parade ground as a dozen army helicopters buzzed overhead.
The performance of brass bands and military hardware was a major departure from the usually low profile of the PLA contingent in Hong Kong. In an apparent attempt to allay local unease about the Chinese army - which is widely remembered for opening fire on civilians on and around Tiananmen Square in 1989 - soldiers rarely leave their barracks.
But this year, the military's top brass launched a charm-and-power offensive. Yesterday's march followed the first display of naval power in the terri tory: a flotilla of eight heavily-armed warships that passed through Victoria Bay in April.
The garrison commander, Lieutenant General Wang Jitang, said the troops would defend the administration of Tung Chee-hwa, the unpopular chief executive hand-picked by Beijing leaders to run the territory.
"We are showing our immense power and determination to defend Hong Kong's prosperity and stability," he said. "We will, as in the past, actively support the law-abiding government led by Tung Chee-hwa."
In a gesture of conciliation - and warning - democratic politicians were invited to the parade, a rare chance for the main critics of the communist party to participate in an event organised by the state.
Analysts saw this as an attempt to ease political tensions ahead of legislative elections next month, when the government fears heavy losses among its supporters despite the limited franchise in many constituencies.
Public opinion swung against the mainland this spring when the legislature in Beijing controversially ruled out universal suffrage and direct elections for Hong Kong's leader in 2007.
Hundreds of thousands of democracy supporters took to the streets last month, protesting against a decision that many feel eroded the autonomy the territory was promised under the "one country, two systems" agreement reached with Britain during the hand-over period.
Such concerns have been heightened by reports that campaigning journalists have been intimidated into retirement. Last week, the director of Commercial Radio cited "hidden dark forces in society" in explaining why it was terminating the contract of outspoken DJ Albert Chen.

>> OUR FRIENDS THE SAUDIS...PRINCELY PREROGATIVES?

Saudi Minister and Prince Pays Monthly Stipend and Debts of Surrendered Wanted Terrorist and Family

http://www.memri.org/bin/latestnews.cgi?ID=SD75404
On June 23, 2004, Saudi Crown Prince Abdallah declared on behalf of King Fahd a one month ultimatum during which Al-Qa'ida members should surrender themselves to authorities. Responding to this ultimatum, number 25 on the 26 most-wanted list Othman Bin Hadi Al-Maqbul Al-Omari surrendered on June 28, 2004. Al-Omari was described by the authorities as a "weapons smuggler of the first degree." [1] The following is the sequence of events surrounding Al-Omari's surrender, as reported by the Saudi media:
The turning in of Al-Omari was mediated by the extremist Wahhabi cleric Sheikh Safar Al-Hawali, who currently serves as a mediator between wanted terrorists and Saudi authorities.
Al-Hawali described to the Saudi government daily Al-Watan the process of turning Al-Omari in. He said that he met Al-Omari in his home in Jeddah, where they had dinner and discussed Al-Omari's demands in return for turning himself in. Those demands were described by Al-Hawali as "simple demands" which the Ministry of Interior can not reject. During the meeting, Al-Omari confessed to Al-Hawali that he had "planned to carry out an operation that would cause bloodshed and destruction, but reneged after he was convinced it wouldn't bring any good, and that such acts are forbidden."
After the meeting, Al-Hawali accompanied Al-Omari to the home of Prince Muhammad Bin Naif Bin Abd Al-Aziz, who is the son of Interior Minister Prince Naif, for whom he also serves as assistant for security affairs, holding the title of Minister. According to Al-Hawali, the minister prepared a "great human" reception for Al-Omari, and "blessed him and praised him for his courageous stand to surrender himself shortly after the amnesty was declared."
Al-Hawali noted during the two hour meeting that "Prince Muhammad Bin Naif gave the wanted terrorist Othman Al-Omari the possibility of choosing which prison he wishes to remain in until the end of his interrogation - whether in Riyadh, Jeddah, or in the Al-Namas region [in which he lives] in order to be close to his family." Al-Hawali described this proposal as "clear proof that Prince Muhammad Bin Naif understands the feelings of the wanted, and is determined to secure their tranquility." Al-Omari chose to stay in one of Jeddah's prisons.
Al-Hawali also told the daily that "Prince Muhammad Bin Naif stressed to Al-Omari that he would be well-treated throughout his interrogation and trial, and that the state pledges to grant his family protection, and to support it financially and morally, like the families of the other wanted men, whom [the families] are not to blame for what happened." [2]
A few weeks after Al-Omari was turned in, the Saudi newspapers reported that the Saudi authorities had paid off Al-Omari's debts. According to Al-Watan, Othman Al-Omari's mother expressed her "gratitude and appreciation of Prince Muhammad Bin Naif for his noble initiative to pay off the debts of her son, who recently turned himself in to the Saudi authorities." The mother recounted that "Prince Muhammad Bin Naif contributed the entire sum, totaling 170,000 SR [$45,300], as well as a grant of 30,000 SR [$8,000] to Al-Omari's family. In addition, a monthly stipend of 3,000 SR [$800] will be paid to Othman Al-Omari's children, as well as a salary of 2,000 SR [$530] to Othman Al-Omari himself." [3]
The Saudi government daily Al-Riyadh reported that Al-Omari's four children also expressed their gratitude and appreciation to Prince Muhammad Bin Naif for "his initiative which saved their father from debts of 170,000 SR [$45,300]." [4]
[1] Al-Hayat (London), June 30, 2004, Al-Riyadh (Saudi Arabia), July 1, 2004.
[2] Al-Watan (Saudi Arabia), June 30, 2004.
[3] Al-Watan (Saudi Arabia), July 20, 2004.
[4] Al-Riyadh (Saudi Arabia), July 21, 2004.
-----------------------------------------------------------------------


>> MEANWHILE...

Va. Couple File Lawsuit to Free Their Son Held in Saudi Arabia
By Caryle Murphy
Washington Post Staff Writer
Thursday, July 29, 2004; Page A08
A Falls Church couple who contend that U.S. authorities are responsible for the year-long detention of their 23-year-old son in Saudi Arabia filed a petition yesterday in federal court in Washington seeking his release.
In papers filed in U.S. District Court, Omar and Faten Abu Ali are requesting that Ahmed Abu Ali, their U.S.-born son, who was arrested in June 2003 while studying in Saudi Arabia, be returned to this country. If he has done something wrong, they say, he should be tried in a U.S. court.
The couple's petition argues that their son's detention is an example of "extraordinary rendition," a practice in which U.S. authorities transfer individuals suspected of terrorist connections to foreign intelligence services that often use coercive interrogation techniques illegal in this country.
Although U.S. authorities "did not send . . . Abu Ali to Saudi Arabia," the court papers state, "they accomplished the same objective as the rendition for interrogation policy by requesting their agents, Saudi officials, to arrest, detain, and interrogate him in furtherance of U.S. interests."
Morton Sklar, executive director of the World Organization for Human Rights USA, a human rights group assisting Abu Ali's family with the petition, said, "We've been looking for a case to directly challenge the practice of rendition to torture . . . to stop the policy itself."
The court papers name Attorney General John D. Ashcroft, FBI Director Robert S. Mueller III, Homeland Security Secretary Tom Ridge, Secretary of State Colin L. Powell and several FBI agents as the U.S. officials responsible for Abu Ali's extended detention.
Department of Justice spokesman Charles Miller said that he had not seen the petition but that "when we do respond, it would be in court." FBI spokesman William Carter said, "If there has been a habeas corpus filing, that precludes us from making any comment on it." State Department spokesman Edgar Vasquez said, "We have not yet seen the lawsuit, but we do not normally comment on ongoing legal matters." Brian Roehrkasse, a Homeland Security spokesman, also declined to comment, citing "pending litigation."
Adel Al-Jubeir, foreign affairs adviser to Saudi Crown Prince Abdullah, could not be reached for comment. Previously, Jubeir said that the U.S. government is aware of why Saudi Arabia is holding Abu Ali and that his government "would be willing to consider" an extradition request "when it was made."
The exact number of people "rendered" or moved to foreign countries with U.S. assistance is unknown, but two cases have received widespread publicity.
Canadian citizen Maher Arar -- who U.S. authorities alleged had links to al Qaeda -- was sent from a New York airport to Syria last year, where Arar said he was tortured for 10 months before being released. And in late 2001, two Egyptians living in Sweden were kidnapped and flown to Egypt with U.S. assistance.
Abu Ali's case is different in that he is an American citizen and was already in the country where he is now detained.
"I'm sure the U.S. government's approach to this is going to be to say he is being detained by a foreign government and we don't have anything to do with it," Sklar said. "But the evidence contradicts it. . . . There are so many indications that the U.S. government was causing this."
Abu Ali's parents, who emigrated from Jordan, say in their petition that a U.S. consular officer in Riyadh informed the State Department that a senior Saudi official had "indicated to him that Ahmed Abu Ali could be returned to the U.S. at any time if the U.S. issued a formal request."
At a May 14 meeting, State Department employee Matthew Gillen told the family "that no current investigation of Ahmed Abu Ali by either the U.S. or Saudi Arabian government was taking place" and that he would "make the formal request to Saudi Arabia necessary for [it] to release him," the petition asserts. But in a June 21 meeting, it adds, Gillen said he could not make that request "due to an investigation taking place in the Department of Justice."
The court papers disclose that prosecutors subpoenaed "numerous witnesses who were friends or acquaintances" of Abu Ali to a grand jury about seven months ago and that in May, FBI agents and federal prosecutors from Alexandria again "sought to interview" Abu Ali in Saudi Arabia. The family alleges that U.S. officials "have sought to coerce" Abu Ali, who also has Jordanian citizenship, into "abandoning his U.S. citizenship so that he could be sent to Sweden or some other country."
U.S. officials have declined to give an explanation for Abu Ali's lengthy detention. But their interest in him appears to stem from alleged ties to some of the 11 Northern Virginia men accused in federal court in Alexandria of undertaking paramilitary training to wage "violent jihad" on behalf of Muslims abroad. Two of those men were also accused of conspiring to support al Qaeda.
Three of the defendants, all U.S. citizens, were arrested in Saudi Arabia at the same time as Abu Ali and brought back to the United States. At a bond hearing for one of them in 2003, an FBI agent testified that Abu Ali had told his Saudi interrogators that he had joined an al Qaeda cell in Saudi Arabia and wanted to plan terrorist attacks.
But Abu Ali was not charged in the Alexandria case. And late last year, U.S. counterterrorism officials who spoke on the condition that they not be identified gave varying assessments of his importance as a terrorism suspect. One official called him "a player" with significant ties to al Qaeda; another said he was "very peripheral."
? 2004 The Washington Post Company
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Her Virtual Prison
Carmen bin Ladin lifts the veil on the culture that produced her infamous brother-in-law.
BY DANIELLE CRITTENDEN
Thursday, July 29, 2004 12:01 a.m. EDT
Very few first-person accounts have emerged from behind the Saudi veil. For good reason: The rare Saudi woman not stifled into submission would risk severe punishment for speaking out. This is the importance of "Inside the Kingdom," by Carmen bin Ladin. Don't be put off by the author's last name. Ms. Bin Ladin is not a distant relation seeking to cash in on her family's notoriety. She is the ex-wife of Osama's older brother Yeslam, and she has her own story to tell. Her memoir is perhaps the most vivid account yet to appear in the West of the oppressive lives of Saudi women.
Carmen, who grew up in Geneva, is the daughter of a Swiss father and Iranian mother. She was raised as a Muslim of liberal outlook. When she met Yeslam in Geneva in the early 1970s, she had no reason to doubt that he was as forward-looking as she. She followed her husband to business school in California and then back to Jeddah, Saudi Arabia, and the bin Ladin family business.
The bin Ladens (the spelling varies: Carmen favors "Laden" for plural forms) are one of the richest and most important non-princely Saudi clans. Yeslam's father, the founder of the fortune, had died by the time Carmen joined the family. He left behind 22 wives, 25 sons and 29 daughters. Yeslam was known to his relatives as "Number Ten," referring to his position in the line of patriarchal succession.
Carmen's life in Saudi Arabia began when her car pulled up to Yeslam's mother's compound outside Jeddah. In the mid-1970s, the town was still not much more than a donkey crossroads in the middle of the desert. If winds weren't whipping up the sand in blinding funnels, the sun was scorching down with unbearable heat. Shrouded in her unfamiliar and suffocating black robes, Carmen entered what sounds like a luridly decorated marble tomb. From then on, she was no longer free.
Each day, Yeslam vanished to work. Carmen and her young daughter passed the hours in the company of his mother and sister. Rarely could she leave the house--rarely, even, did she see sunlight. Courtyards had to be cleared of male servants before she could poke her head outside; she was not even permitted to cross the street alone to visit a relative. When she did venture out, she had to wear a choking abaya and thick socks to hide her ankles. "It was like carrying a jail on your back," she writes.
Nor was she much freer inside the house. She could not listen to music, pick up an uncensored book or newspaper, or watch anything on television but a dour man reading the Quran. Nor could she absorb herself in household tasks. These were left to foreign servants, including the care of children.
Carmen was horrified by the effects of this isolation and uselessness. "The Bin Laden women were like pets kept by their husbands;. . . .Occasionally they were patted on the head and given presents; sometimes they were taken out, mostly to each other's houses;. . . .I never once saw one of my sisters-in-law pick up a book. These women never met with men other than their husbands, and never talked about larger issues even with the men they had married. They had nothing to say."
She would meet Osama only a couple of times. (She describes the young Osama as "tall and stern, his fierce piety intimidating.") She had more contact with his young wife, Najwah, in the female section of one of the segregated bin Laden houses: Najwah, like so many women raised in Saudi Arabia, "never permitted herself to want more from her life than obedience to her husband and father." She carried her obedience to such extremes that it nearly killed the couple's infant son. The child had become dehydrated in the heat. Carmen watched as Najwah pitifully tried to spoon water into the baby's mouth. Najwah would not use a bottle because Osama did not approve of this newfangled Western technology.
At first, Carmen consoled herself with hopes that the oil boom would soften the harsh bedouin culture of Saudi Arabia. "Naively I believed that economic change would be followed by social shifts, too." But after the Iranian revolution of 1979, the Saudi rulers crushed all liberalizing trends in their society. Yeslam, too, changed for the worse. He returned with Carmen to Geneva to expand his business but this time took along the rigors of Saudi Islam. The marriage deteriorated, and Carmen began to fear for the future of her three daughters. Although Yeslam had never been an attentive father, he sought custody of them in the couple's divorce proceedings. If he prevailed, the girls could have vanished into Saudi Arabia, never to be seen by their mother again.
Fortunately, the Swiss courts awarded custody to Carmen. She has emerged from her ordeal with some urgent insights into the kingdom from which she escaped: "Osama bin Laden and those like him didn't spring, fully formed, from the desert sand. They were made. They were fashioned by the workings of an opaque and intolerant medieval society that is closed to the outside world. It is a society where half the population have had their basic rights as people amputated, and obedience to the strictest rules of Islam must be absolute. Despite all the power of their oil-revenue, the Saudis are structured by a hateful, backward-looking view of religion and an education that is a school for intolerance . . . .When Osama dies, I fear there will be a thousand men to take his place."
Yet Carmen's own example is reason for optimism. The contempt for outsiders that Osama blindly swallowed repelled his sister-in-law--and drove her to seek a freer life for herself and her daughters. Let us hope that more brave dissenters--female and male--will follow her lead.

Ms. Crittenden is the author of "What Our Mothers Didn't Tell Us" and "Amanda Bright @ Home," a novel. You can buy "Inside the Kingdom" by Carmen bin Ladin from the OpinionJournal bookstore.
--------------------------------------------------------------------------------------------
>> DAILY HOWLER...JOD DATABASES



Group Sues Justice Department Over Access to Lobby Records
By Ted Bridis Associated Press Writer
Published: Jul 29, 2004
WASHINGTON (AP) - A watchdog group sued the Justice Department on Thursday to compel officials to turn over records from a database on foreign lobbyists, which the department said would overwhelm its computer system.
A lawyer for the Washington-based Center for Public Integrity said in the lawsuit that the information sought is "readily reproducible in electronic form." The lawsuit, filed in the U.S. District Court for the District of Columbia, also asked the judge to award the group its attorney's fees.
A Justice Department spokesman, Charles Miller, declined to comment on the lawsuit.
The group since January has sought information about lobbying activities that is available under the U.S. Foreign Agents Registration Act, a 1938 law passed in response to German propaganda before World War II.
Database records describe details of meetings among foreign lobbyists, the administration and Congress, and payments by foreign governments and some overseas groups for political advertisements and other campaigns.
The Justice Department previously told the center that it could not provide the records before the end of the year.
Thomas J. McIntyre, chief in the Justice Department's office for information requests, explained in a May 24 letter that the computer system - operated in the counterespionage section of the department's criminal division - "was not designed for mass export of all stored images" and said the system experiences "substantial problems."
The government said an overhaul of the system should be finished by December and copies should be available then.
On the Net:
Justice Department: www.usdoj.gov/criminal/fara
Center for Public Integrity: www.publicintegrity.org
AP-ES-07-29-04 1448EDT
--------------------------------------------------------------------------------------------
>> AHEM...

- Three of four Al Qaida web sites have Internet roots in the United States
Most of the websites aligned or identified with Al Qaida stem from the United States. About 76 percent of the Al Qaida-aligned websites were registered or supported by Internet service providers in the United States. A study by the Washington-based Middle East Media and Research Institute reported that Islamic groups have increased their dependence on the Internet for operations and recruitment...
-Kuwait's Al Qaida problem: Recruiters targeting teens...
-Well-funded Moroccan terror network called threat to Europe...
-Korea's Pohang Iron & Steel continues China offensive...
-----------------------------------------------------------------------------------------
>> GOOD NEWS?

http://theworld.org/latesteditions/20040727.shtml
North Korea report (4:00)
More than 200 North Korean refugees flew into South Korea today under a veil of secrecy. It's the largest single group of defectors to date from the Stalinist north. The World's Katy Clark has the story.

Follow-up interview (4:30)
The more than 200 North Korean defectors that arrived in South Korea today is the largest single group ever to cross into the south. Some say that number is part of an even bigger group, possibly signalling an exodus. But South Korean officials are keeping a tight lid on the details. Host Jennifer Glasse speaks with Ambassador Jack Pritchard, a top advisor to President Bush on North Korea, about the effect on relations between the North and South and the US reaction.


-------------------------------------------------
>> WELL SAID AIDAN...



PYONGYANG WATCH
N Korean refugees the beginning of a flood?
By Aidan Foster-Carter
Some 460 North Korean refugees flew into Seoul's Songnam military airport on two chartered Asiana flights on Tuesday and Wednesday. They came from the same officially unidentified Southeast Asian country. (Shall we stop the pussy-footing, please? It's Vietnam, is it not?)
This is an important moment. First of all, the numbers. At a stroke, the Vietnam 460 take the total of North Korean defectors, as they are officially called, reaching South Korea this year, which stood at 760 as of end-June, almost up to the 1,285 who arrived in the whole of 2003.
For decades after the Korean War, the number of North Koreans escaping to the South was tiny, reflecting the near-impassability of the heavily mined and fortified border, the ironically named Demilitarized Zone. A rare soldier or two has made it across the DMZ - in both directions, as we've been reminded recently with the weird tale of Charles Robert Jenkins: the 8th US Cavalry sergeant who disappeared northward across the line in January 1965, and lived in North Korea for the next 39 years until he and their two daughters were reunited with his Japanese abductee wife - you couldn't make this up, could you? - first in Indonesia and now in Japan, where the US Army may yet be stupid enough to charge him with desertion rather than treat him as an intelligence gold mine. But all that is another story.
Take me to the river
So if you want to leave North Korea - and who wouldn't? - you have to head north, across the long river border into China. Hitherto that hasn't been too hard, though some reports say fences are now being built. The west-flowing Yalu is difficult, but in the northeast the Tumen River freezes in winter, while in summer some sections are shallow and narrow enough to wade across. Border guards can be eluded, or sometimes bribed.
No one knows quite how many North Koreans have made that journey over the past decade, since the Democratic People's Republic of Korea's (DPRK) chronic malnutrition spiraled into outright famine. The often-quoted figure of 300,000 is plausible, if this means cumulative crossings. But the number actually hiding out in China at any given time is probably much lower, especially since Beijing has cracked down viciously on these fugitives in recent years.
Surveys by aid organizations, working in the border area under very difficult conditions, suggest that most such refugees come from North Korea's northeastern border province of North Hamgyong. That figures, on two counts: the border is near, and conditions are desperate. Formerly an industrial area, too mountainous to grow much food, Hamgyong-pukdo has seen its factories close and its people starve, in unknown numbers. Andrew Natsios - author of the first book on what he calls the Great North Korean Famine, and currently head of the US Agency for International Development (USAID) - accuses Kim Jong-il's regime of "triage" in North Hamgyong: in effect cutting it off and letting it starve.
So those who can, vote with their feet. A majority seem to be women - and not all of them leave voluntarily. There are many reports now of North Korean women being sold into China, whether for marriage, or to work in bars or worse. As always in such trafficking, abuses are numerous because rights are non-existent. This is a nasty, sordid business.
China persecutes the starving
It's no exaggeration to accuse all governments concerned - make that unconcerned - of behaving appallingly. North Korea, naturally, starves and mistreats its people, and then has the gall to regard any who flee as traitors, and punish them accordingly. If at first you leave simply out of hunger or to find work, but then get caught in China and sent back to be beaten up and jailed, naturally you emerge with no great love for the Dear Leader (Kim Jong-il) and flee again, this time determined never to go back to such a hell-hole. "Persecuting the starving" is the all-too-apt title of an Amnesty International report on this bitter process.
This well-documented cycle gives the lie to China's despicable refusal to treat any North Koreans who are illicitly on its territory as refugees. The party line from Beijing is that they're all economic migrants. As such, under a border treaty with North Korea, China can and does round them up and send them back. Worse, it won't even let the United Nations High Commissioner for Refugees (UNHCR) - which has an office in Beijing, but itself stands accused of failing to press hard enough on this issue - visit the border areas and see for itself. All this contravenes international conventions to which China is a signatory.
So what's a poor North Korean in China to do? Staying put, you have to hide out. A few activist non-governmental organizations (NGOs) - mostly South Korean, some Japanese or American; often Christian or Buddhist - may help you, but they too must be furtive, as they risk arrest and deportation: one such, Kim Hee-tae, was released this month after two years in a Chinese jail. Because of the need to hide, your kids - many refugees are children - can't go to school. It's no life at all, by normal standards. But anything has to be better than North Korea.
Seek asylum - but where?
Other than lie low, or return to North Korea, there are two options. One is to seek asylum in a foreign mission in China. Two years ago there was a rush of embassy incursions in Beijing, aided by activists. The lucky ones who made it eventually got to Seoul; but since then security around embassies has been tightened, and a crackdown in the northeastern border area means that in a sense this tactic has made life worse for the far larger number who remain in China. (Activists hotly argue the pros and cons, as may be imagined.)
A few still succeed via this diplomatic route, such as a group in June who got into a German school in Beijing. But for most, the only option is to continue the journey: to get out of China into another country, they hope more welcoming, and thence onward to Seoul.
That means going either north or south: to Mongolia, or Southeast Asia. Either journey is both physically arduous and risky. On April 2 a 17-year-old boy, Lee Chol-hun, who had spent half his life hiding in China, was shot - in the back, by some accounts - and killed by a Chinese border guard while trying to cross into Mongolia. (Ah, the heroic People's Liberation Army, bravely defending the motherland against all comers!) Read more on http://www.northkoreanrefugees.com/boyshot.htm.
Even once over the border, the unforgiving Gobi takes its toll. Yoo Chul-min was just 10 when he perished on July 7, 2001, lost and exhausted in the desert. For his tragic tale, with pictures of a bright-eyed boy in a baseball cap, and of the wooden cross that marks his lonely grave, see http://www.familycare.org/stories/yoochul.htm.
Underground railway
The southerly route, which more take, has its own perils. You have to cross the length of China. Physically you blend in, but just hope no one tries to talk to you and twigs that you're a foreigner. Again this is costly and risky. An "underground railway" of activist NGOs may help with money and safe houses. But mostly you're on your own: not in the arid Gobi, but trying to cross the thick steaming jungles of Southeast Asia undetected. Thailand is the preferred destination, but beggars can't be choosers. So North Koreans turn up in Vietnam, Laos, or even - God help them - Myanmar.
Even there, they often have to continue an underground existence. No doubt we'll get the full story on - and stories of - the Vietnam 460 eventually, but probably they represent an accumulation over several years. The South Korean government that believes in quiet diplomacy on such matters - too quiet by half, say critics, considering it technically recognizes all North Koreans as Republic of Korea (ROK) citizens - had no doubt been negotiating delicately behind the scenes with Hanoi to bring them to Seoul. There are even reports that Vietnam was threatening to send them back - presumably to China, which would then deport them to North Korea, as is feared to have happened in several recent cases.
Vietnamese sensitivities
Vietnam, though nominally communist, is not especially friendly with North Korea, but it has its own sensitivities on the refugee front (remember boat people?). There's also an ongoing issue with the Montagnard minority, who've been fleeing to Cambodia to escape state persecution. In the party paper Nhan Dan last Sunday, a Vietnamese Foreign Ministry spokesman, Le Dung, accused UNHCR of conducting "many wrong activities to lure ethnic-minority people in the Central Highland to illegally flee to Cambodia, and [it] even considered to give these people political refugee status".
Not to be outdone in the persecution stakes, on the same date the Cambodian government arrested two reporters (one Irish, Kevin Doyle of the Cambodia Daily) who were trying to reach 17 Montagnard asylum-seekers - and charged them with human trafficking. They were released a day later, after "confessing". Radio Free Asia, one of whose stringers was arrested, has more details.
Coming to America?
The international ramifications run wider yet. More than 1,000 Montagnards won asylum in the United States after an earlier crackdown in 2001. Some US human-rights activists would like North Koreans to be similarly welcomed in the land of the free. On July 21, the US House of Representatives unanimously passed the North Korea Human Rights Act (NKHRA) 2004. If this becomes law - which is far from certain: it has yet to go to the Senate, and time is short - this would mandate the US to foreground human-right issues in all its dealings with North Korea. One specific provision is to make it easier for North Koreans to seek asylum in the US. Last year just nine applied, of whom six were refused.
This too is controversial. Most of the NKHRA's backers are on the Republican right. (An even tougher separate North Korea Freedom Act, currently before the Senate, avowedly seeks regime change.) The bills' opponents - including South Korea's ruling Uri Party, which is getting up a petition on the subject - fear that raising all this will offend Kim Jong-il's delicate sensibilities. Pyongyang might then pull out of the six-party talks and various dialogues and projects with South Korea, thus jeopardizing what little progress has been achieved in recent years.
Engage and press
I beg to differ. Western European countries, which have recognized North Korea en masse since 2000, see no contradiction in seeking engagement with Pyongyang while actively pursuing human-rights concerns. Thus it was European Union states that this year and last submitted resolutions condemning North Korean human-rights abuses to the UN Commission on Human Rights (UNCHR; not to be confused with UNHCR). South Korea abstained on this; last year it absented itself from the vote. But the resolutions passed, and a special rapporteur has been appointed to probe and press on these matters, to Pyongyang's fury.
How can that not be right? Read any of the websites that give you chapter and verse on the terrible sufferings of North Korean refugees - too many to list: just Google! - and if your blood doesn't boil, may I suggest you take your heart in for a service. This of all areas is one where, frankly, I find it hardest to keep the cool detachment of an "expert". In that capacity, I've written no fewer than five reports on North Korea refugee issues in recent years for UNHCR (two are still on their website). But as a human being, I find the hypocrisy and silence of all the governments concerned nauseating.
Lee Chol-hun and Yoo Chol-min, and thousands more, are dead. They deserved better. They had a right to live - and to lead a proper life, not the living hell of a subject of Kim Jong-il or a fugitive in China. So I'm glad for the Vietnam 460: May there be many more. Any decent human being or government should do everything in their power to help them gain sanctuary and a chance to live a human life: the kind you, dear reader, and I take for granted as our birthright as human beings and free people.
Moment of truth
For South Koreans, though, this is an awkward moment of truth. The ROK government is not only slow to help - it has even sometimes initially turned away its own citizens: old prisoners of war illegally held for half a century in North Korea - but also grudging in its provision for the few that do make it to Seoul. Its Hanawon facility, which trains North Koreans for what in some ways is life on another planet, has a capacity of only 400. So the Vietnam 460 have had to be housed at a commandeered training center elsewhere.
Even so, defectors find it tough to adjust to South Korean turbo-capitalism. They face prejudice, and about half are unemployed. Yet if the South can't even integrate the mere few thousands it has so far, how on earth would it cope if it faced a Germany scenario - and suddenly had to take on all 22 million of its impoverished Northern brethren?
That, of course, is the nightmare Seoul seeks to avoid at all costs. Fair enough, in my view, to try a gradualist approach with Pyongyang and hope for a soft landing. If it can be brought off, this would indeed be less risky, and much less costly, than if Kim Jong-il's regime were to collapse on a sudden. Maybe, at long last, the Dear Leader will see reason.
Prepare for the worst
Yet a preference for evolution over revolution is no excuse either for not preparing for a less desirable outcome - which sheer prudence requires, so as not to be overwhelmed if collapse comes - or for not fighting for the human rights of all North Koreans here and now, be they refugees or still enjoying the doubtful mercies of the Dear Leader's rule.
Pyongyang can bleat about being persecuted all it wants, like the late British comedian Kenneth Williams: "Infamy! Infamy! They've all got it in for me." Not so. On human rights, as on nuclear weapons and a host of other concerns, all that the world asks - and is entitled to ask, and must go on asking - of the DPRK is to behave in a civilized way, like a modern 21st-century state: to treat its people properly and live up to international norms, standards and treaties, many of which it has in fact signed, and so is legally bound by.
As for South Koreans, they had better brace themselves. Why would, or should, their Northern cousins not seek a better life than Kim Jong-il has ever vouchsafed them? South Koreans in the past fought hard for their own human rights against their own dictators, rightly scorning pleas to desist on grounds of national security or economic development. How can they now hesitate to help, let alone deny the same rights to democracy and a decent life to their Northern brethren, without arrant selfishness and rank hypocrisy?
Come to that: how will the cherished goal of Korean reunification really be achieved? By letting a few befuddled lefty activists cavort with cynical DPRK apparatchiks in Incheon to celebrate paid-for summits, as we saw last month? Or by South Koreans taking to their bosom the tired, huddled masses who are Kim Jong-il's victims, to give them the rights to a life hitherto denied to them? In a word: reunification with and for whom, exactly?
So, welcome the Vietnam 460. May many follow them. And will the last North Korean to leave please turn out the lights? No need: Kim Jong-il's power cuts have already rendered it a land of darkness, in every sense. Let there be light, and life. No more weasel excuses.
Aidan Foster-Carter is honorary senior research fellow in sociology and modern Korea, Leeds University, England.
(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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Rising tide of N. Korean defectors worries Seoul
Special to World Tribune.com
EAST-ASIA-INTEL.COM
Wednesday, July 28, 2004
More than 200 North Koreans defectors move into buses after arriving at Seongnam military airport in South Korea behind a wall of secrecy as the government played down the biggest influx yet of defectors from the Stalinist state.
SEOUL -- The announcement that a total of 400 North Korean defectors now staying in a Southeast Asian country are coming to South Korea this week is raising social and political concerns.
The number of North Korean defectors to South Korea has increased from only 60 in 1999 to 297 in 2000, and to 572 in 2001 and more than 1,000 in 2003. During the first half of this year, the number reached 760 and is steadily increasing. More than 5,100 North Korean refugees have found home in the South so far. And there are no reliable estimates of how many more will arrive in the next few years.
While politicians and nongovernmental organization (NGO) groups welcome the triumph of the government's quiet diplomacy to repatriate North Korean defectors to Seoul en mass, they fear that this will lead to many problems, including the lack of facilities to house them and personnel to educate them.
Another concern, rarely voiced in the increasingly pro-North Korean South, is that there may be infiltrators among the genuine defectors or that their status as second class citizens could in the future be exploited by the North as the two sides proceed toward unification.
The South Korean government has repeatedly assured the nation that it would take in all North Korean defectors willing to come to South Korea. But the facilities have proven inadequate to accommodate ate those that have come in.
Hanawon, the housing and educational facility, had the capacity for only 400 even after an expansion this year. Consequently the original education curriculum is being reduced from six months to two months, which is said to be far from adequate to educate the North Koreans from socialism to capitalism. Moreover, the government settlement subsidy of 36 million Won will be reduced to 20 million Won, not enough to rent a house.
South Korean society is not united about assisting the defectors, and contributions from the civilian sector are still limited. The slow recovery of the South's economy is an added burden.
Then again, there is the danger of diplomatic friction with China and discontent from Pyongyang over the defector issue. More than 100,000 North Korean defectors are are believed to be scattered and in hiding in China, fearing arrest and deportation to North Korea. In recent years, as China stepped up its efforts to apprehend defectors, South Korean NGOs have been helping them find their ways to such neighboring countries as Vietnam, Thailand, Cambodia and Burma.
According to an NGO member helping North Korean defectors, the 400 defectors are coming not from one Southeast Asian country, but two. "We have been helping them with shelter and food, but as the number increased, it put the countries into a difficult position," he said. That provided a common ground for working out a solution with South Korean government, according to the NGO volunteer worker.
Copyright ? 2004 East West Services, Inc.
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N. Korea Upset at South Over Defections
By SOO-JEONG LEE
The Associated Press
Thursday, July 29, 2004; 3:28 AM
SEOUL, South Korea - North Korea called the mass defection of nearly 460 of its citizens to South Korea this week a "planned kidnapping" and lashed out Thursday at Seoul and other parties involved in the two-day airlift.
The North Koreans, believed to have fled their communist homeland via its border with China before heading to a Southeast Asian country, arrived in Seoul in two planeloads Tuesday and Wednesday in an operation shrouded in secrecy.
South Korean government officials have been reluctant to confirm the arrival and have declined to reveal the Southeast Asian country from where the defectors arrived, apparently to spare that government from diplomatic reprisals by North Korea.
North Korea's statement Thursday, by a spokesman from the Committee for the Peaceful Reunification of the Fatherland, was the North's first public response to the defector airlift.
"This is an organized and planned kidnapping as well as a terror crime that took place in broad daylight," the spokesman said, according to KCNA, the North's official news agency.
"The South Korean government will be fully responsible for the outcome of this situation, and other forces that cooperated in this affair will also pay a big price," the spokesman said.
Despite the harsh words, the latest incident was unlikely to damage relations between Pyongyang and Seoul, an analyst said.
"North Korea is using harsh words as they usually do, but if they are in need of something from the South, such as economic aid or food aid, they will come out to talks with the South," said Park Joon-young, a North Korea expert in Seoul. "The North Koreans act in accordance with their interests, so I don't think it will effect inter-Korean relations."
The first group of 230 defectors arrived Tuesday on a specially chartered flight by South Korea's Asiana Airlines, the country's Yonhap news agency reported, followed by a second batch of 227 defectors on a Korean Air flight Wednesday.
The government barred reporters from covering the events, but TV footage captured from afar showed defectors getting off planes before being whisked away in buses.
It was by far the largest arrival in what has become a steady stream in recent years of North Koreans fleeing repression and hunger in a country that has depended on outside help to feed its 22 million people since 1995.
Most of the North Koreans flee across their country's long border with China, and human rights groups say hundreds have made their way to Vietnam, Thailand, Cambodia and other Southeast Asian countries, hoping eventually to go to capitalist South Korea.
Over 5,000 North Koreans have defected to South Korea since the 1950-53 Korean War. Last year, the number of defectors arriving in the South reached 1,285, up from 1,140 in 2002 and 583 in 2001.
South Korea's Unification Minister Chung Dong-young said the number of North Korean defectors was expected to reach 10,000 within a few years and that the government needs to upgrade its policies on handling them.
The Koreas were divided in 1945. Their border remains sealed and heavily guarded by nearly 2 million troops on both sides following the 1950-53 Korean War that ended in a truce, not a peace treaty.
? 2004 The Associated Press

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>> ALAS FOR HIS VIRGINS?

Saddam Suffers From Prostate Infection
By RAWYA RAGEH
Associated Press Writer
BAGHDAD, Iraq (AP) -- Seven months after being taken prisoner, former Iraqi leader Saddam Hussein suffers from a chronic prostate infection but has rebuffed suggestions that a biopsy be performed to rule out cancer, Iraq's human rights minister said Thursday.
Tests show that, despite the prostate problem, the 67-year-old deposed dictator is otherwise in good health and has even shed some extra weight while in U.S. detention, Human Rights Minister Bakhtiar Amin told Al-Jazeera television.
He said X-ray and blood tests came back negative for cancer, but officials wanted to take a biopsy to be safe.
Chronic prostate infections occur in about 35 percent of all men over 50, but are not linked to cancer. Routine screening for prostate cancer, especially among older men, is becoming more common.
Saddam has been held by U.S. officials at an undisclosed location in Iraq since his capture by U.S. forces last December near Tikrit. He had been on the run since his regime collapsed in April in the face of a U.S.-led invasion.
There have been several media reports saying his health was deteriorating, something the U.S. military denied Thursday.
"Saddam did not have a stroke, and he is not dead," 1st Sgt. Steve Valley told The Associated Press. He did not provide further information.
A Jordanian-based spokesman for the International Committee of the Red Cross, the only neutral entity with access to Saddam, said Thursday the organization had no information about a downturn in Saddam's health.
"Saddam's sickness was rumors spread by the media," Mu'in Kassis told The Associated Press. The ICRC said it has visited him at least twice to check on his condition and carry messages to his family.
According to Amin, Saddam has lost weight after following a diet. He spends his time reading the Quran, writing poetry and tending to a garden, Amin said.
Mohammed al-Rashdan, a member of Saddam's defense team, said the lawyers have received unconfirmed information that Saddam suffered a stroke. He urged the Iraqi government to allow them, his family or a neutral party to send a doctor to Iraq to examine Saddam.
Officials at the Iraqi prime minister's office said they had no information on the ousted leader's condition.
Caused by a variety of bacteria, prostate infections develop gradually and can remain undetected for a long time because symptoms are typically subtle and sometimes there are none at all.
The infections are not easy to cure because antibiotics do not accumulate in high concentrations in the prostate. Treatment usually involves several months of strong antibiotics.
? 2004 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Insurgents target Jordan's key logistical role in Iraq
SPECIAL TO WORLD TRIBUNE.COM
Wednesday, July 28, 2004
AMMAN -- Insurgents in Iraq have attacked Jordan's position as a vital logistics base for members of the U.S.-led military coalition in Iraq.
Sunni insurgency groups have abducted Jordanian nationals and threatened them with execution unless the Hashemite kingdom ends assistance to the United States and other militaries in Iraq. So far, one Jordanian firm announced it would withdraw from Iraq.
"Jordan has profited handsomely by its ability to send supplies to militaries in Iraq," a Western diplomatic source said. "If that goes, it will hurt both Jordan as well as the coalition."
Over the last year, Jordan has been employed to provide logistics, training, supplies and even intelligence information to members of the military coalition in Iraq, Middle East Newsline reported. Western diplomatic sources said Jordan was preferred over Kuwait, Iraq's southern neighbor, by members of the coalition with troops in central and northern Iraq.
[On Wednesday, more than 50 Iraqis were killed in Baaquba, north of Baghdad. U.S. officials said a minibus packed with explosives blew up near a police station where hundreds of young men were waiting to apply to become officers.]
Amman's role has also committed the kingdom to train 32,000 Iraqi police officers as well as an unspecified number of Iraqi military troops until 2007. Industry sources have estimated this contract at more than $1.3 billion.
Last week, Jordan agreed to serve as a support base for South Korea, which has pledged to deploy 3,000 troops in Iraq. Seoul plans to begin sending its forces to Iraq in August.
Jordanian officials said Amman will cooperate with Seoul on a range of requirements for South Korean deployment in Iraq. They cited Jordanian intelligence, logistics and supplies for South Korean troops planned to be stationed in northern Iraq.
The two countries agreed on Jordan's role during a visit by King Abdullah to Seoul. On July 24, Abdullah met South Korean President Roh Moo-hyun in Seoul and discussed the situation in post-war Iraq.
Officials did not report the value of Amman's supply and support agreement with South Korea. Jordan has helped other members of the U.S.-led coalition, including the United States, with logistics, supplies and training. Jordan's military has also sent advisers in Iraq.
Sunni insurgency groups aligned with the former Saddam Hussein regime have warned Jordan to end the supply route to the U.S.-led military coalition. Scores of truck drivers transporting supplies to Baghdad have already been abducted or attacked in Iraq near the Jordanian border.
On Tuesday, the so-called "Group of Death" warned that it would attack vehicles coming from Jordan into Iraq. "Group of Death" announced a July 30 deadline for Jordan to stop all supplies to Iraq.
So far, at least one Jordanian supplier of the military coalition said it would withdraw from Iraq. The announcement by the Amman-based Daoud and Partners came after two of its employees were abducted and threatened with execution unless the firm paid $140,000 and left Iraq. Daoud has provided construction and catering services to the U.S. military.
"We consider all Jordanian interests, companies and businessmen and citizens as much a target as the Americans," a masked member of "Group of Death" said in a video supplied to news agencies. "We will cut the road between Jordan and Iraq so that Jordanian supplies cannot supply the U.S. Army."
Copyright ? 2004 East West Services, Inc.

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>> SAY WHAT?


La red contra el lavado deja escapar a los peces gordos
Por Marcela Sanchez
Especial para washingtonpost.com
Friday, July 23, 2004; 8:09 AM
Cuando de lavado de dinero se trata lo mejor es hacerlo a alto nivel.
Hace m?s de dos a?os, la Ley Patriota de Estados Unidos estableci? como requisito para todas las instituciones financieras informar a las autoridades cualquier actividad sospechosa con el prop?sito de asegurar que no sean utilizadas para financiar terrorismo, lavar dinero u ocultar ganancias de actividades criminales.
Desde entonces, sin embargo, algunos gobiernos que Washington cataloga como patrocinadores de terrorismo, junto con funcionarios corruptos de otros pa?ses y narcotraficantes han usado muchas instituciones financieras conocidas sin que ninguna instituci?n lo informara a tiempo. Entre ellas: el principal banco de Puerto Rico, Banco Popular; la sucursal estadounidense del banco suizo UBS; el Hudson United Bank de New Jersey; y Terrabank en Miami.
La semana pasada, investigadores del Senado revelaron que el Riggs Bank, una respetada instituci?n de Washington, ayud? al ex dictador chileno Augusto Pinochet a ocultarle hasta $8 millones a fiscales internacionales. Denunciaron adem?s que representantes del banco le entregaron a Pinochet, a domicilio y en persona, su dinero antes de que las autoridades pudieran congelar sus cuentas.
El problema en el Riggs no se limit? a Pinochet sino que incluy? tratos sospechosos con funcionarios de Arabia Saudita y con Teodoro Obiang Nguema, dictador de Guinea Ecuatorial. En vez de provocar rechazos, ejecutivos del banco parecieron demasiado deseosos de atender a las necesidades de clientes de mala fama mientras que reguladores federales a duras penas tomaron cartas en el asunto. Acciones legales claves contra Riggs solo ocurrieron, seg?n los investigadores del Senado, "despu?s de que informes de prensa negativos empezaron a generar preguntas p?blicas".
Ir?nicamente los bancos podr?an aprender algo de las centenares de empresas no bancarias que env?an miles de millones de d?lares en remesas cada a?o alrededor del mundo desde peque?as y modestas oficinas en comunidades ?tnicas y de inmigrantes. Incluso antes de la Ley Patriota, los remitentes de dinero con licencia empezaron a auto regularse y hoy figuran entre las instituciones financieras que mejor conocen a sus clientes y con m?s frecuencia informan a las autoridades sobre actividades cuestionables.
Desde mediados de los 90, autoridades federales sospechaban que los remitentes de dinero eran muy propensos a actividades criminales, particularmente lavado de activos. Para sobrevivir y prosperar en un mercado r?pidamente creciente - y evitar procesos judiciales - los remitentes tomaron la delantera.
Los bancos, por otra parte, no han tenido esos mismos "incentivos" para reformarse, haciendo que la eterna lucha por detectar y castigar actividades ilegales en la forma de transacciones financieras internacionales sea hoy muy desequilibrada y de eficacia cuestionable.
"El sistema regulador en su totalidad tiene un serio problema de aplicaci?n desigual de leyes y regulaciones", dijo Charles Intriago, un exfiscal federal que ahora es presidente de lavadodinero.com. Mientras docenas de peque?os remitentes de dinero han sido sancionados, sentenciados o sufrido multas millonarias, dijo, ning?n comerciante de valores de un tama?o considerable ni banco alguno en los ?ltimos 13 a?os han sido sentenciados. Mientras sigan recibiendo siempre la carta para "Salir libre de la c?rcel" como en el juego de Monopolio, los bancos no tomar?n las leyes en serio, agreg?.
En el 2001, un padre y sus dos hijos, due?os de una compa??a de env?os de remesas en Miami, fueron atrapados en una operaci?n encubierta y sentenciados a 188 y 155 meses respectivamente por lavar $714.000 d?lares. En el 2003, en la acci?n m?s severa contra un banco en a?os, el Banco Popular de Puerto Rico fue acusado por no informar sobre el lavado de $21.6 millones de dinero de la droga y conminado con procesos judiciales. Pero despu?s de que el banco pag? una multa de $20 millones, acept? su responsabilidad y prometi? portarse bien en el futuro, el gobierno acord? no enjuiciarlo. (Para aquellos que est?n llevando cuentas, $21.6 millones es $20.9 millones m?s que $714.000 - y aun as? el presidente del banco se quej? de haber sido tratado injustamente).
Por a?os los bancos estadounidenses han estado neg?ndole cuentas o cerr?ndoselas a los remitentes por temor a que sean propensos a actividades criminales. M?s a?n, en un esfuerzo por proveer a m?s inmigrantes con necesarios servicios bancarios, l?deres a lo largo de las Am?ricas est?n llamando a una mayor participaci?n de los bancos en el multimillonario negocio de remesas. El resultado podr?a ser quitarle negocio a aquellos con protecciones ejemplares contra el lavado de dinero y d?rselo en cambio a aquellos con un manchado historial.
Claro que no todos los bancos son culpables y ese es precisamente el mensaje que quisieran enviar los remitentes sobre s? mismos. Mientras existen todav?a miles de remitentes sin licencia, hay docenas con licencia que trabajan duro para cumplir plenamente con las leyes y regulaciones estadounidenses.
Aun as? el Departamento del Tesoro estadounidense contin?a se?al?ndolos a todos como negocios arriesgados. Por lo menos en esos casos los bancos est?n escuchando cuidadosamente a los reguladores y optando por cerrarle sus puertas incluso a los remitentes con licencia. En casos m?s importantes, sin embargo, grandes instituciones bancarias mantiene el dudoso honor de lavar las cantidades m?s grandes de dinero para los clientes m?s prominentes y corruptos - con poco temor a las consecuencias.
? 2004 Washingtonpost.Newsweek Interactive





Anti-Laundering Net Lets Big Fish Slip
By Marcela Sanchez
Special to washingtonpost.com
Friday, July 23, 2004; 7:57 AM
When it comes to money laundering, it's better to do it big time.
More than two years ago, the USA Patriot Act established reporting requirements for all financial institutions to ensure that they are not used to finance terrorism, launder money or stash funds generated by criminal activity.
Since then, however, certain governments that Washington lists as sponsors of terrorism along with corrupt foreign officials and drug traffickers have used many well-known financial institutions without those institutions reporting any suspicious activities. Among them: Puerto Rico's largest bank, Banco Popular; the U.S. branch of the Swiss bank UBS; New Jersey's Hudson United Bank; and Terrabank in Miami.
Just last week, Senate investigators revealed that Washington's own Riggs Bank helped former Chilean dictator Augusto Pinochet hide up to $8 million from international prosecutors and that bank representatives hand-delivered Pinochet's money to him before U.S. authorities could freeze his accounts.
The problems at Riggs didn't end with Pinochet, but included suspicious dealings with Saudi officials and with Teodoro Obiang Nguema, Equatorial Guinea's dictator. Instead of raising red flags, bank executives seemed too willing to cater to notorious customers while federal regulators were too slow, at the very least, to take action. Key enforcement actions against Riggs only occurred, according to Senate investigators, "after negative press reports began raising public questions."
Ironically, banks could learn something from those hundreds of non-bank licensed money transmitters that send billions around the world from small and inconspicuous offices in immigrant and ethnic communities. Even before the Patriot Act, licensed money transmitters began to regulate themselves and today they are second to none among financial institutions in knowing their clients and reporting questionable activities to authorities.
Ever since the mid-1990s, federal authorities suspected that transmitters were vulnerable to criminal activity, particularly money laundering. In order to survive and thrive in a rapidly expanding market -- and to avoid prosecution -- transmitters got ahead of the curve.
Banks, on the other hand, have lacked some of these "incentives" to reform, making the eternal struggle in tracking and prosecuting illegal activity in the form of international financial transactions today a very unbalanced operation of questionable efficacy.
"The whole regulatory system has a serious problem of uneven application of laws and regulations," said Charles Intriago, a former federal prosecutor who now runs moneylaundering.com. While dozens of small money transmitters have been penalized, prosecuted or suffered forfeitures, he said no securities dealer of any significant size or any U.S. bank in 13 years has been prosecuted. As long as they receive a "Get Out of Jail Free" card every time, banks won't take enforcement seriously, he added.
In 2001, a father and two sons, owners of a money transmitter company in Miami, were caught in a sting operation and later sentenced to 188 months and 155 months respectively for laundering $714,000. In 2003, in the harshest action against a bank in years, Puerto Rico's Banco Popular was accused of failing to report the laundering of $21.6 million in drug money and was threatened with criminal charges. But after the bank paid a $20 million fine, accepted responsibility and promised to behave in the future, the government agreed not to prosecute. (For those keeping score, $21.6 million is $20.9 million more than $714,000 -- and still the bank's president complained of having been unfairly singled out.)
U.S. banks for years have been denying or closing the accounts of licensed money transmitters for fear they are too prone to illegal activity. What's more, in an effort to provide more immigrants with useful banking services, leaders throughout the Americas are encouraging banks to be more involved in the multimillion-dollar remittance business. The result may be to take business away from those with exemplary safeguards against money laundering and put it instead in the hands of those with a spotty track record.
Sure, not all banks are culprits, and that's exactly the point licensed transmitters would like to make about themselves. While there are still hundreds of unlicensed money transmitters, there are dozens of licensed ones trying hard to fully comply with current U.S. laws and regulations.
Yet the Treasury Department continues to label them all as risky. At least in this instance, banks are willingly listening to regulators and opting to close their doors to licensed transmitters. In more important cases, however, large banking institutions maintain the dubious honors of laundering the largest amounts of money for the most prominent and corrupt customers -- with little fear of the consequences.
Marcela Sanchez's e-mail address is desdewash@washpost.com.


? 2004 Washingtonpost.Newsweek Interactive

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>> OH PERVEZ?


Pakistan's king-maker drops a bombshell
By Syed Saleem Shahzad

KARACHI - In a surprise development on Wednesday, Pakistan's political map was potentially redrawn with the country's leading king-maker, Pir Pagara, announcing his separation from the ruling Pakistan Muslim League to revive his own party, which he had earlier merged with the PML on the personal request of President General Pervez Musharraf.
The PML, which dominates parliament, was created as an umbrella pro-government bloc to serve as an obedient vehicle for Musharraf to push ahead with his agenda and to give him a defined role once he eventually sheds his uniform.
The move by the influential politician is likely to be followed by other defections from the PML, and comes amid a number of developments that will shape the future of Pakistan in the coming months.
These include military operations in the sensitive tribal regions to track down foreign insurgents, a new military initiative in Balochistan province against nationalist insurgent tribes, the issue of sending troops to Iraq, and the installation of a non-political technocrat (Chaudhry Shujaat Hussain) as prime minister. Further, two generals are due to retire in October and will need to be replaced, and by the end of the year Musharraf is bound by the constitution to choose between one of the two hats he currently wears - chief of army staff or president. Exiled former premier Benazir Bhutto is also tipped to return to the country soon to revitalize her opposition Pakistan People's Party against Musharraf.
At a hastily called press conference on Wednesday, Pir Pagara said he would reinstitute his Pakistan Muslim League (Functional) party as an independent entity.
Syed Shah Mardan Shah, or Pir Pagara II, is one of the most powerful spiritual personalities in the country, with about a million spiritual disciples among the tribes of Sindh. Over the years he has carved a career for himself as a king-maker, rather than a participant in direct politics. His father was a prominent freedom fighter in British India, from Sindh, although the ruling British called him a traitor and hanged him. Later, though, the British sponsored Pir Pagara to study at Oxford. He returned at the request of Pakistan's first premier, Liaquat Ali Khan, in the early 1950s, and was launched into national politics on the PML's platform.
Being the head of an armed militia called Hur (free and brave man), he supplied thousands of volunteers to the Pakistan army in the 1965 and 1970 wars against India, which helped him forge deep ties in the military. On many an occasion he has publicly stated that "I take orders in national politics from GHQ", meaning general army headquarters in Rawalpindi.
Now at this most critical juncture of national politics, which many analysts are calling a major transition period, the GHQ's man has turned.
After hearing of Pir Pagar's news, Asia Times Online tracked him down to his palatial residence in Karachi, where many of his disciples were gathered. They regularly shower him with rupees when he makes an appearance, no matter how brief.
Sitting in his office in his house, behind a door decorated with the sign of Scorpio, Pir Pagara was having a meal of fried fish and lentil. In an hour-long meeting, he relied mostly on his expressions, rather than his tongue, his typical way of communicating.
"I think it is the beginning of the end, isn't it?" this correspondent asked in reference to Pir Pagara's decision to part ways with the ruling PML.
"We merged in the ruling party after the president gave me lots of assurances, and we were united for the cause of the Pakistan Muslim League, not for the cause of the rule of Jat [a reference to the Jat tribe of premier Hussain, who has appointed Jats to key positions in the PML]. What's your news from the center?" Pir Pagara asked.
"I spoke to a few friends in the National Assembly who are associated with the ruling Pakistan Muslim League and they are really frustrated. You may agree with me that ours is a tribal society where different systems work, and perhaps many may not accept a non-political entity like the technocrat Shaukat Aziz [Finance Minister and prime minister-designate] who is not interested in the ruling party members nor their interests. What's your feedback?"
Pir Pagara took a bite of his fish and nodded his head in the affirmative.
Asia Times Online continued, "You know better than me, in Punjab, all feudal families have their men in positions in the army as well as in parliament."
Pir Pagara's eyes shone and he shook his hands, but his mouth was busy chewing fish. Finally he said, "But Saleem, the president's men are guiding him [Shaukat] the wrong way."
All this while Pir Pagara's telephone kept ringing and was answered by his men, but he refused to speak directly to any of the callers, including one from the highest office of Sindh province who wanted to ask whether Pir Pagara continued to support the provincial government there. As this was a strictly private business, this correspondent took his leave.
Pir Pagara has reportedly made it clear that until Musharraf personally speaks to him and accepts his complaints about the present and future premiers, he will not listen to or meet with anybody.
Whether or not Pir Pagara changes his mind, the first real bullet of dissent has been fired and the game is on.
(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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>> REUTERS AHEM?

Pakistan Says Captures a 'Most Wanted' Qaeda Man
29 minutes ago Add World - Reuters to My Yahoo!
ISLAMABAD, Pakistan (Reuters) - Pakistan said Friday it had arrested a senior al Qaeda figure wanted for the 1998 bombings of two U.S. embassies in Africa that killed hundreds of people.
Interior Minister Faisal Saleh Hayat identified the man as Ahmed Khalfan Ghailini and said he was a Tanzanian national wanted for the synchronized bombings that killed more than 200 people at the U.S. embassy in Kenya and 11 at the embassy in Tanzania.
"He carried head money of $25 million," Hayat told Reuters.
He said Ghailani was one of about a dozen people arrested on Tuesday when security forces raided a suspected militant hideout in the city of Gujarat, about 110 miles southeast of the capital Islamabad.
Ghailani is on the FBI (news - web sites)'s "Most Wanted Terrorists" list for his alleged role in the 1998 bombings, which also said it was "offering a reward of up to $25 million for information leading directly to the apprehension or conviction of Ahmed Ghailani."
Ghailani was among seven people about whom the United States said in May it was seeking information amid fears of a possible attack in the near future.
A Pakistani official said Tuesday that Pakistani security forces were holding three Africans, including a Tanzanian, suspected of being militants after a shootout last week.
Another said the suspects had been trying to flee Pakistan along with their families, using fake documents, after living in neighboring Afghanistan (news - web sites).
Pakistan, a key ally in the U.S.-led "war on terror," has arrested hundreds of al Qaeda members since the September 11, 2001 attacks on the United States. Several senior al Qaeda figures have been handed over to Washington.

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Face value
A different sort of oligarch
Jul 29th 2004
From The Economist print edition
Reuters
Having got rich in Russia, Kakha Bendukidze now wants to be the world's most capitalistic politician
FORGET eBay. If you want to buy a dysfunctional boiler house, an international airport, a tea plantation, an oil terminal, a proctology clinic, a vineyard, a telephone company, a film studio, a lost-property office or a beekeepers' regulatory board, then call Kakha Bendukidze, Georgia's new economy minister. His privatisation drive has made him a keen seller of all the above. And for the right price he will throw in the Tbilisi State Concert Hall and the Georgian National Mint as well.
Mr Bendukidze made his name and fortune as an industrialist in neighbouring Russia, putting together the country's biggest heavy-engineering group, OMZ, before returning to his native Georgia in June of this year with a mandate to reverse more than a decade of post-Soviet decay. He insists that he was taken by surprise when Georgia's president, Mikhail Saakashvili, and prime minister, Zurab Zhvania, nobbled him for a chat in the course of a private visit he made to Tbilisi in May, and then offered him a ministerial job the same evening. But having said yes, he is cracking ahead, doing everything that businessmen must dream of making governments do. He says that Georgia should be ready to sell "everything that can be sold, except its conscience". And that is just the start.
Next year--if not sooner--he will cut the rate of income tax from 20% to 12%, payroll taxes from 33% to 20%, value-added tax from 20% to 18%, and abolish 12 kinds of tax altogether. He wants to let leading foreign banks and insurers open branches freely. He wants to abolish laws on legal tender, so that investors can use whatever currency they want. He hates foreign aid--it "destroys your ability to do things for yourself," he says--though he concedes that political realities will oblige him to accept it for at least the next three years or so.
As to where investors should put their money, "I don't know and I don't care," he says, and continues: "I have shut down the department of industrial policy. I am shutting down the national investment agency. I don't want the national innovation agency." Oh yes, and he plans to shut down the country's anti-monopoly agency too. "If somebody thinks his rights are being infringed he can go to the courts, not to the ministry." He plans, as his crowning achievement, to abolish his own ministry in 2007. "In a normal country, you don't need a ministry of the economy," he says. "And in three years we can make the backbone of a normal country."
Good luck, and he will need it. Mr Saakashvili's new government has taken over a country where half the population lives on less than $2 a day, relations with Russia are tense, and rebel regimes control two provinces. The previous president, Edward Shevardnadze, a former Soviet foreign minister, was driven out in November by huge public demonstrations against election-rigging and corruption.
Mr Bendukidze is the second minister plucked from the Georgian diaspora. The first, the French-born Salome Zourabichvili, was France's ambassador to Georgia until Mr Saakashvili made her his foreign minister. She wants to build political ties with the West, in order to help Georgia to fend off fresh attempts at domination by Russia. Yet at the same time, Georgia needs investment from Russia's booming corporate sector--and here Mr Bendukidze's experience should come in useful. Until May he was a prominent figure in the circle of top Russian tycoons known as the "oligarchs", albeit a notch below the oil barons, such as the now-imprisoned Mikhail Khodorkovsky of Yukos and the soccer-mad Roman Abramovich of Sibneft and Chelsea Football Club.
A clever and likeable man, aged 48, Mr Bendukidze was a scientist until the Soviet Union collapsed, and never did seem to be one of nature's metal-bashers even at the height of his empire-building. He says now that he was preparing to retire from business some months before the offer came from Mr Saakashvili. Early this year OMZ looked set to merge with another Russian engineering company, Power Machines, though that deal now seems to be off. Still, Mr Bendukidze has put his shares in trust, and resigned as chief executive. He is a political liberal as well as an economic one, and thus no soul-mate of Russia's president, Vladimir Putin, says a western diplomat who knows him well. Asked whether he was retreating from Russia for fear that the persecution of Mr Khodorkovsky might turn into a purge of oligarchs in general, Mr Bendukidze will not be drawn, saying only that "we have had times [in Russia] harsher than this."
He is frank about the failings of the chaotic and often rigged Russian privatisations of the 1990s which made him and other oligarchs rich. He snapped up most of OMZ's assets for peanuts-- though, by the standards of the day, he subsequently earned his fortune, restructuring the company and halving its workforce. The lesson he drew from the Russian experience, he says, is to change the method of privatisation, not the principle of it. He promises public sales to the highest bidder, and cash only: "no conditions, no promises, no beauty contests".
Georgia on my mind
He insists that Georgia is a more "individualistic" place than Russia, and thus more receptive to reform. Georgians may take some persuading. A knot of demonstrators blocks Mr Bendukidze's way to work each morning. Opinion polls show only lukewarm support for privatisation. Mr Saakashvili and Mr Zhvania claim to admire his radicalism, but they may yet feel obliged to curb it if they want to conserve political capital for sparring with Moscow or with rebel regions. To Mr Bendukidze, such problems are another argument for boldness: big improvements in business conditions are needed in order to offset big political risks and to keep investors coming. "Other governments make budgets," he says. "We are making a nation."
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.

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>> IRAN WATCH...FULL SPEED AHEAD?

Le diff?rend entre l'Iran et l'Agence internationale de l'?nergie atomique rebondit
LE MONDE | 29.07.04 | 13h39 * MIS A JOUR LE 29.07.04 | 15h36
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T?h?ran a bris? des scell?s appos?s par l'AIEA.
L'Iran a bris? des scell?s appos?s par l'Agence internationale de l'?nergie atomique (AIEA) sur des centrifugeuses servant ? la production d'uranium enrichi, ? Natanz, une installation nucl?aire situ?e ? 250 km au sud de T?h?ran, ont indiqu? des diplomates ? Vienne mercredi 28 juillet. L'uranium enrichi est un composant n?cessaire ? la mise au point de l'arme nucl?aire.
"Cette d?cision indique que l'Iran a repris la fabrication et l'assemblage de centrifugeuses", en infraction d'un engagement pris en 2003 de suspendre toutes ses activit?s d'enrichissement d'uranium, a indiqu? un diplomate. "T?h?ran n'a toutefois pas repris les op?rations d'enrichissement ? proprement parler", a pr?cis? un autre diplomate, soulignant que la R?publique islamique n'a "pas l'obligation l?gale" de suspendre l'enrichissement.
L'Iran, que les Occidentaux soup?onnent de vouloir mettre au point la bombe atomique sous couvert d'un programme nucl?aire civil, avait accept? en octobre 2003, ? l'occasion d'une visite des ministres des affaires ?trang?res fran?ais, allemand et britannique, de suspendre unilat?ralement et temporairement ses activit?s d'enrichissement. Il s'?tait en outre engag? ? appliquer le protocole additionnel au Trait? de non-prolif?ration nucl?aire (TNP) avant m?me de l'avoir ratifi?.
MANQUE DE COOP?RATION
Mais l'arrangement avait ?t? remis en question fin juin, quand l'Iran avait annonc? qu'il reviendrait sur son engagement de suspendre la production et l'assemblage de centrifugeuses de type P2, apr?s que le Conseil des gouverneurs, l'organe ex?cutif de l'AIEA, eut reproch? ? T?h?ran un manque de coop?ration et l'eut mis en demeure de fournir tous les renseignements demand?s pour prouver qu'il ne cherchait pas ? acqu?rir l'arme nucl?aire.
L'Iran accuse Paris, Berlin et Londres de ne pas avoir rempli leur part du contrat qui consistait, selon T?h?ran, ? faire en sorte que le dossier nucl?aire iranien soit referm? par l'AIEA ? la fin juin. Mercredi ? T?h?ran, le vice-pr?sident de la commission parlementaire des affaires ?trang?res et de la s?curit? nationale, Mohamoud Mohammadi, a averti que le nouveau Parlement conservateur iranien ne ratifierait pas le protocole additionnel au TNP, aussi longtemps que l'AIEA n'aurait pas class? le dossier nucl?aire de la r?publique islamique.
La ratification est li?e ? "une condition : l'AIEA doit d'abord reconna?tre notre droit ? utiliser la technique nucl?aire ? des fins pacifiques", a-t-il ajout?. "Notre crainte, c'est que le protocole additionnel soit utilis? contre nous comme une arme de pression politique. S'ils -l'AIEA- traitent notre dossier d'un point de vue strictement technique, alors nous coop?rerons", a-t-il dit.
Le dossier nucl?aire iranien devrait une nouvelle fois ?tre examin? lors de la prochaine r?union du Conseil des gouverneurs, ? partir du 13 septembre, ? Vienne. Les Etats-Unis font pression ? l'AIEA pour que ce dossier soit transmis au Conseil de s?curit? de l'ONU, seul habilit? ? d?cr?ter d'?ventuelles sanctions internationales.

L'Iran a d?cid? de reprendre la fabrication de centrifugeuses parce qu'il juge les Etats-Unis obnubil?s par l'?lection pr?sidentielle du 2 novembre et les Europ?ens trop divis?s pour exercer de r?elles pressions, estiment des sources diplomatiques ? Vienne. Des discussions doivent avoir lieu cette semaine entre T?h?ran et les Europ?ens, ? Londres ou ? Paris. - (AFP.)
* ARTICLE PARU DANS L'EDITION DU 30.07.04
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Iran Defies Pressure, Resumes Tests of Nuke Plant
Reuters
Thursday, July 29, 2004; 8:23 AM
By Francois Murphy
VIENNA (Reuters) - Iran has defied international pressure and resumed testing a facility for converting uranium, a key part of the process of enriching the element for use as fuel or in a nuclear bomb, diplomats said Thursday.
The European Union's "big three" -- France, Britain and Germany -- strongly criticized Iran when it tested the site in March, saying it sent the wrong signal and would make it harder for Tehran to regain international confidence.
The EU three were due to meet Iranian officials in Paris on Thursday to discuss Tehran's nuclear program.
The United States says Iran is stringing the international community along with talks over its nuclear program while buying time to make an atomic bomb. Iran denies the charge, saying it is only interested in generating electricity.
While Iran said in April it intended to run the tests at its uranium conversion facility near the central city of Isfahan, the move snubs a request by the U.N. nuclear watchdog for it not to test the site.
The testing would produce a small amount of uranium hexafluoride, the gas which is pumped into centrifuges to obtain enriched uranium, one western diplomat said.
"They are testing the equipment. As a by-product, some UF6 (uranium hexafluoride) is produced," he said.
The International Atomic Energy Agency (IAEA) nuclear watchdog declined to comment.
Iran promised the EU three in October it would suspend all activities related to uranium enrichment. But Iran says it still has the right to produce uranium hexafluoride and build centrifuges. The IAEA says the suspension was meant to apply to both.
After Iran told the IAEA in April it intended to conduct the tests, the IAEA governing board passed a resolution in June that "calls on Iran ... voluntarily to reconsider its decision."
Full Legal Notice
? 2004 Reuters



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Tehran breaks U.N. seals on nukes
By David R. Sands
THE WASHINGTON TIMES
Iran has broken seals placed on nuclear centrifuges by U.N. inspectors and resumed work on the equipment, raising fresh fears that a deal to keep Tehran from joining the world's nuclear-armed powers has collapsed.
Diplomats at the Vienna, Austria-based International Atomic Energy Agency (IAEA), the United Nations' lead agency on nuclear proliferation, confirmed yesterday that Iran had resumed construction of centrifuges, a key part of the nation's nuclear program.
The equipment can be used to produce the material needed for atomic bombs. Iranian officials reportedly broke the IAEA seals on the centrifuge equipment late last month.
Diplomats told reporters that Iran has stopped short of using the centrifuges to begin production of enriched uranium for the bombs, a step that clearly would violate Iran's obligations under the nuclear Non-Proliferation Treaty.
State Department spokesman Adam Ereli said U.S. officials had not confirmed the Iranian move independently but that it fit with what the Bush administration considers a clear pattern of cheating by Iran's Islamic government on its nuclear pledges.
"Iran's commitment to cooperating with the IAEA, to put it kindly, remains an open question," Mr. Ereli said, "given its past failures to follow through on promises made to the [IAEA] board of governors."
Paul Leventhal, president of the Washington-based Nuclear Control Institute, said the Iranian decision was "clearly provocative" and a direct challenge to diplomatic efforts to rein in its nuclear programs.
"The Iranians only confess to what they are caught doing, so we don't know how much more there is to learn," he said. "Iran has been playing a very dangerous cat-and-mouse game, constantly testing how much they can get away with."
The resumption of centrifuge construction also is a direct challenge to the efforts of Britain, France and Germany, which struck a deal with Tehran in October to halt efforts to build the centrifuges or seek to enrich uranium.
The three European powers have resisted a U.S. effort to refer Iranian violations to the U.N. Security Council for sanctions and other punitive measures, arguing that diplomacy is a better path for gaining Iran's cooperation.
Iranian leaders insist that their nuclear programs are intended only for civilian energy purposes, and only grudgingly have conceded to violations uncovered in recent months by IAEA inspectors.
Tehran also has argued that the accord with the three European powers was voided when the IAEA Board of Governors issued another critical report on Iran's nuclear cooperation at the board meeting in June. The construction resumed after the October moratorium expired, Iranian officials said.
Iranian President Mohammed Khatami said earlier this month, "Nothing stands in the way" of renewed centrifuge activity. Iranian officials reportedly informed IAEA officials of their decision to break the seals and said a separate pledge not to produce weapons-grade uranium remained in force.
Despite the disclosures, British diplomats said Iran and the three European powers will hold a previously scheduled meeting later this week at an undisclosed European location.
"We still firmly believe that this is the right way to achieve our goal," a British Foreign Office official told Reuters news agency yesterday.
The prospect of a nuclear-armed Iran could be destabilizing in the region, in particular for Israel, which launched a pre-emptive strike against Iraq's nuclear facilities when Saddam Hussein began efforts to build a nuclear program.
Israeli Chief of Staff Lt. Gen. Moshe Yaalon said on Israeli television yesterday that Iran had "broken the rules of the game."
"This should not only concern Israel, but all the countries of the free world," Gen. Yaalon said.
But Seyed Masood Jazayeri, spokesman for Iran's hard-line Revolutionary Guards, accused Washington of using its "wild dog" -- Israel -- to go after Iran's nuclear programs.
If Israel tried to disrupt the Iranian program, it "would be wiped off the face of the Earth and U.S. interests would be easily damaged," Mr. Jazayeri warned yesterday, according to the Iranian news reports.
*This article is based in part on wire service reports.

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Iran Seeks Nuke Bomb 'Booster' from Russia-Report
Reuters
Wednesday, July 28, 2004; 1:22 PM
By Louis Charbonneau
VIENNA (Reuters) - Iranian agents are negotiating with a Russian company to buy a substance that can boost nuclear explosions in atomic weapons, according to an intelligence agency report being circulated by diplomats.
But the Russian government, which monitors nuclear-related exports closely, denied any Russian companies were planning to supply Iran with the substance, known as deuterium gas.
The two-page report cited "knowledgeable Russian sources" for the information, which Washington will likely point to as more proof that Tehran wants to acquire nuclear weaponry.
"Iranian middlemen ... are in the advanced stages of negotiations in Russia to buy deuterium gas," the report said.
Iran denies wanting atomic arms and says its nuclear program is for peaceful purposes. Deuterium is used as a tracer molecule in medicine and biochemistry and is used in heavy water reactors of the type Iran is building.
But it can also be combined with tritium and used as a "booster" in nuclear fusion bombs of the implosion type.
It is not illegal for Iran to purchase deuterium but it should be reported to the IAEA.
Diplomats say the suspicions surrounding Iran's nuclear program are so great that it would be wise for Tehran to exercise maximum transparency on all such "dual-use" purchases and declare them ahead of time to the U.N. nuclear watchdog.
"Iran has not declared this to the IAEA. Their cover story is that they want it for civilian purposes," said the diplomat who gave Reuters the report.
The report, which did not name the Russian firm, said purchase talks were in the final stages. It added that Iran had tried to produce deuterium-tritium gas -- with the help of Russian scientists -- but had so far failed.
MOSCOW DEFENDS COOPERATION WITH IRAN
Moscow has been criticized by Washington for building the Bushehr nuclear power plant in Iran, despite U.S. concerns that it is a cover for Iran to acquire know-how and import items that can be used for bombs.
Reacting to the report, the Russian Foreign ministry issued a statement saying that in its nuclear cooperation with Iran, Moscow strictly sticks to intergovernmental agreements which do not provide for supplies of the deuterium gas.
"The Russian side is not planning to carry out any such supplies," the statement said.
Anything concerning nuclear exports is under tight government control, including details of separate deals. The government has said it keeps the situation in the sector under control and rejected any idea of major nuclear smuggling.
Envoys linked to the U.N. nuclear watchdog, the International Atomic Energy Agency, said buying deuterium alone was not evidence of intent to acquire a weapons capability.
They cautioned that the report appeared designed to win over nations who are not convinced Iran wants the atomic bomb.
The United States and others are pushing the IAEA to report Iran to the Security Council for possible punishment with economic sanctions for allegedly seeking nuclear weapons in defiance of its treaty obligations.
"Iran needs to know that they will suffer deeply if they get nuclear weapons," said the diplomat who provided the report. France, Germany and Britain have been negotiating with Iran to persuade it to cooperate fully with IAEA inspections to allay Western doubts and are resisting referring Tehran to the U.N.. A high-level meeting is expected in Paris on Thursday.
The U.N. has been investigating Iran's nuclear program for nearly two years to determine whether allegations that it has a secret atomic weapons program are false, as Tehran insists.
While it has found many instances where Iran concealed potentially weapons-related activities, the IAEA says it has no clear evidence that Tehran is trying to build the bomb. The United States and its allies say there is sufficient evidence and the agency is being too cautious. (Additional reporting by Oleg Shchedrov in Moscow)
? 2004 Reuters

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Statoil: U.S. Is Probing Iranian Deal
The Associated Press
Thursday, July 29, 2004; 9:51 AM
OSLO, Norway - Statoil ASA said Thursday that the U.S. Justice Department is conducting a criminal investigation of a consulting deal in Iran that led to the resignation of the Norwegian company's two top executives and nearly $3 million in fines.
The investigation by the U.S. Attorney for the Southern District of New York in Manhattan is in addition to a separate inquiry by the U.S. Securities and Exchange Commission of the same deal.
Both agencies are investigating the state-owned Norwegian company because its shares trade on the New York Stock Exchange.
Statoil drew heavy criticism last year after allegations surfaced that a $15.2 million consulting deal it made with Iran's Horton Investment Ltd. in June 2002 was part of an attempt to improperly influence Iranian oil officials.
An investigation by Norway's economic crime police, Oekokrim, resulted in a fine of 20 million kroner ($2.9 million).
Former chief executive Olav Fjell, who resigned in September 2003 because of the deal, was cleared of any wrongdoing, police said. Then-board chairman Leif Terje Loeddesoel also resigned in September during the scandal and was cleared of wrongdoing.
Statoil made the consulting agreement with Mehdi Hashemi Rafsanjani, the son of former Iranian President Hashemi Rafsanjani, though his name did not appear in the paperwork, investigators said. That raised suspicions that the money might have been intended to influence Iranian public officials.
The Norwegian company canceled the contract on Sept. 10, 2003, and the next day police raided the company's offices in the southwest city of Stavanger.
A police report said Oekokrim concluded that the contract "involved an offer of improper advantages in return for Mehdi Hashemi and/or others influencing persons who were or would be involved in the decision-making processes relevant to Statoil's commercial activity in Iran."
The report said, however, that no evidence of Statoil money actually being used to influence Iraqi officials was discovered.
Statoil was founded in 1972 to oversee Norway's oil interests. It was partly privatized in 2001 when the state sold 17.5 percent of its shares to investors.
On the Net:
http://www.statoil.com
? 2004 The Associated Press


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>> IRANIAN JUSTICE...ALLAH KNOWS THE TRUTH - RIGHT?


Iran offers new explanation for Kazemi's death
Associated Press and Canadian Press
POSTED AT 8:23 AM EDT Wednesday, Jul 28, 2004
Tehran -- Iran's judiciary said Wednesday Iranian-Canadian photojournalist Zahra Kazemi died in custody from a fall after her blood pressure dropped during a hunger strike, a sharp shift in position on a case that has strained relations between Tehran and Ottawa since her death a year ago.
The judiciary also denounced President Mohammed Khatami's reformist administration, which offered Monday to help identify the murderer of Zahra Kazemi, accusing it of providing fuel for a "spiteful" foreign media.
"The death of Mrs. Zahra Kazemi was an accident," a judiciary statement said. A copy was obtained by Associated Press.
"With the acquittal of the sole defendant," the statement said, "only one option is left: The death of the late Kazemi was an accident due to fall in blood pressure resulting from a hunger strike and her fall on the ground while standing."
A Tehran court cleared secret agent Mohammad Reza Aghdam Ahmadi, the sole defendant in the case, on Saturday of killing Ms. Kazemi, who died of a fractured skull and brain hemorrhage in detention last July.
Ms. Kazemi, a Montreal freelance journalist born in Iran, died on July 10, 2003, while in detention for taking photographs outside a Tehran prison during student-led protests against the ruling theocracy.
Iranian authorities initially said Ms. Kazemi died of a stroke, but a presidential committee later found that she died of a fractured skull and brain hemorrhage. Mr. Ahmadi was charged with "semi-premeditated murder." He denied it, and a team of lawyers representing the victim's mother contended that the real killer was Mohammed Bakhshi, a prison official who was being protected by the hardline judiciary.
Mr. Bakhshi was cleared of wrongdoing before Mr. Ahmadi's trial.
On Tuesday, Ms. Kazemi's son said Ottawa should kick Iran's ambassador out of the country.
Mr. Hachemi made the appeal just before he met Foreign Affairs Minister Pierre Pettigrew, who has yet to decide on concrete action to show Ottawa's displeasure with the Iranian government.
Mr. Hachemi, who has been harshly critical of Ottawa's handling of the affair, saw no reason to change his tone after his meeting with Mr. Pettigrew.
The minister refused to make any firm commitments to any of his proposals, he said.
"Until I hear him commit, he has failed me, he has failed my mother and he has failed human rights. ... The minister has not respected the memory of my mother.
Canadian officials have said they are considering a range of diplomatic pressure tactics, but have not indicated that expelling ambassador Mohammed Ali Mousavi is among them.
They are, however, studying the possibility of taking the Kazemi case to the International Court of Justice at The Hague -- another demand made by Mr. Hachemi.
Iran-Canada relations, soured by the slaying and subsequent quick burial of Ms. Kazemi in Iran against her son's wishes, further deteriorated after Iran rejected the idea of Canadian observers at the trial. The Canadian ambassador was barred from attending the last session of the otherwise open trial.
The Iranian judiciary's statement also accused Iranian government spokesman Abdollah Ramezanzadeh of making "irresponsible" comments when he directly challenged the judiciary Monday by saying Iran's Intelligence Ministry was prepared to identify the person behind Ms. Kazemi's murder if the judiciary allowed it to do so.
Mr. Ramezanzadeh, it said, was inciting public opinion, an accusation that could put the judiciary and government in a direct confrontation if formally pursued as a criminal charge. Judiciary spokesman Zahed Bashirirad said Wednesday there was no intention to indict Mr. Ramezanzadeh at the moment.
The judiciary statement said Mr. Ramezanzadeh had ignored the fact that the court gets the final say in any legal case.
Nobel Peace laureate Shirin Ebadi, who represents the victim's mother, has rejected the court proceedings as flawed, and has vowed to "work until my last breath" to find the murderer.

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Iranian Prosecutor Shuts 2 Newspapers
Outlets Reported on Trial That Implicated Official in Death of Detained Photographer
By Karl Vick
Washington Post Foreign Service
Tuesday, July 27, 2004; Page A18
ISTANBUL, July 26 -- An Iranian prosecutor has ordered the closures of two newspapers that reported last week on a trial involving a case in which he is alleged to have been involved.
The prosecutor, Said Mortazavi, shut down Jomhouriat, which had published for only 12 days, and Vaghayeh Ettefaghieh over their coverage of the trial of an intelligence agent accused of beating and killing an Iranian Canadian photographer at a prison in the Iranian capital, Tehran, last year. Mortazavi, who supervised interrogations at the prison, has been accused by Canadian authorities of having a role in the killing. The only person charged, however, was the agent, Mohammad Reza Aghdam Ahmadi.
On Saturday, a Tehran court acquitted Ahmadi, and Iran's hard-line judicial branch subsequently declared that the case would never be solved.
The shuttering of the newspapers served as an example to other Iranian news media, sources in Tehran said. According to the sources, who said they were warned by Mortazavi's office not to give interviews to the foreign press but who passed information through intermediaries, the papers may be able to reopen in August.
"It shows how Mortazavi has done everything he could to hide and cover up the evidence," said Stephan Hachemi, son of the slain photojournalist, Zahra Kazemi. "There is no hope. They have proved that Iran has no intention whatsoever of bringing justice to the case of Zahra Kazemi."
When Kazemi died in detention after a blow to the head, Mortazavi ordered Iranian officials to announce that she died of natural causes, according to two outside investigations. She was later found to have died of a brain hemorrhage caused by a fractured skull.
Nobel Peace Prize laureate Shirin Ebadi, an attorney who represents Kazemi's family, threatened to take the case to international courts.
Iranian reformers embraced the case of Kazemi, an Iranian-born Canadian citizen who was widely seen as a surrogate for Iranian nationals who disappear into a judicial system that answers only to the theocracy's most senior cleric. But outcry over this case spread beyond the country's borders.
Canada recalled its ambassador after he was denied a promised seat at the trial. The envoy had also been recalled last summer after Kazemi's body was buried in Iran without an opportunity for an independent autopsy abroad.
"This trial has done nothing to answer the real questions about how Zahra Kazemi died or to bring the perpetrators of her murder to justice," Canadian Foreign Minister Pierre Pettigrew declared in a statement.
Reporters Without Borders, an advocacy group based in Paris, denounced the trial as "a masquerade of justice orchestrated by the Iranian authorities" and called for the European Union to impose sanctions. The group also protested the shuttering of the two newspapers.
In a symbolic gesture, about 300 journalists bound their hands Monday to protest mounting restrictions on free expression. Ebadi attended the meeting of the Journalists' Professional Association.
For hard-liners in Iran, the judiciary has long served as both a stronghold and a sanctuary, where appointed conservatives have been able to thwart the efforts of elected reformers. Mortazavi has been its most notorious operative, closing more than 100 newspapers that questioned Iran's authoritarian rule.
But after 25 years as one of the world's most isolated states, Iran has also made clear an appetite to cultivate economic and diplomatic ties abroad. The decision to open its shadowy nuclear program to international inspectors was linked to promises of trade with Europe.
External pressure forced Iran's judiciary to proceed with the trial, which could only embarrass hard-liners, according to foreign diplomats based in Iran. After Ahmadi was acquitted, the state offered to pay "blood money" to Kazemi's family, "as Islamic law stipulates . . . for a Muslim within state responsibility when perpetrators of a crime are not identified," the judiciary said in a statement published by Iran's official news agency.
Hachemi, the victim's son, scoffed at the offer and called for Canada to break diplomatic relations with Tehran, as Washington did in 1979 after the takeover of the U.S. Embassy there. "Since we don't have a dialogue with Iran, what's the use of having an ambassador?" he said.
Meanwhile, a spokesman for the reformist faction of the government on Monday repeated an offer to the judiciary for "a full and transparent investigation."
A diplomat based in Tehran said that such a probe would be highly unlikely after Mortazavi and other hard-liners thwarted two earlier investigations but added that the case "is not going to die an easy death."
? 2004 The Washington Post Company
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>> DARFUR ETC MALAYSIAN CONNECTION...

LINKS...
http://www.aisehman.org/

The Pain That Will Never Go Away
Cruelty and death reign in Sudan, and war brews.
The world rushes to help, while we, we Malaysians celebrate another deal in our pockets:
A three-member consortium led by Malaysia's MMC Corp (MMCB.KL) has won a US$65.6 million contract to build an oil pipeline in Sudan's Melut Basin, MMC said on Monday [July 26].
The consortium, which include China's Sinopec (SNP.N) (0386.HK) and Oman Construction Co., won the deal from Petrodar Operating Company which is developing two oil reserves - Block 3 and 7 - in Sudan's southeast, MMC said in a statement.
The project, due to be completed in May 2005, involves laying a 490-km export pipeline for segment B1 of the Melut Basin Development Project.
Petrodar is a venture between China National Petroleum Company International (Nile) Ltd, Petronas Carigali Overseas Sdn Bhd, Sudapet Ltd, Gulf Oil Petroleum Ltd and Al Thani Corp.
Sinopec, Asia's largest refiner and China's leading importer of gas oil, holds the majority 41 percent stake in Petrodar.
Petronas Carigali, the overseas exploration arm of Malaysian energy firm Petronas, holds 40 percent, while Sudapet, Gulf oil and Al Thani jointly hold the remaining 19 percent. [Reuters via Sudan Tribune: Malaysia's MMC, Sinopec in Sudan oil pipeline deal]
The last three companies that have annouced plum deals in Sudan -- Ranhill, Lankhorst and MMC -- are all led by Muslim Malaysians. Well done.
Ladies and gentlemen of the Foreign Ministry and Petronas: if you're reading this [and I know some of you are], and you feel you can outlast me on this one, you thought wrong.
The shit in Sudan is going to last longer than you think, and I will try my level best to be the pain in your orifice until you show some balls and some spine.
Posted at 01:37 AM in Current Affairs | Permalink | Comments (1) | TrackBack (0)
Tuesday, July 27, 2004
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>> UN BAH...

U.S. Drops Sanctions From U.N. Resolution
By KIM GAMEL
ASSOCIATED PRESS
UNITED NATIONS (AP) -
The United States dropped the word "sanctions" from a draft U.N. resolution on Sudan on Thursday due to opposition on the Security Council, but it retained a threat of economic action against Khartoum if it fails to disarm Arab militias in Darfur.
The Security Council announced it was ready to vote Friday on the resolution, which has been revised four times in the past week as the United States sought to overcome objections.
Pakistan, China and Russia argued that the 15-nation Security Council argued that Sudan should be given more time to end the violence that some have called ethnic cleansing and even genocide.
In Kuwait, Secretary of State Colin Powell told reporters the United States acquiesced in the change from "sanctions" to "measures" because the latter word was more acceptable to a broader number of Security Council members.
He acknowledged that there is concern in Egypt and some other countries that too much pressure on the Sudanese government could cause internal problems that would make the situation worse.
"At the same time, everybody recognizes that pressure is needed or else we wouldn't get any action at all," Powell said.
Algerian Ambassador Abdallah Baali, whose country also opposed the previous text, welcomed the new version and said he hoped for a unanimous vote. "At first glance, we feel that we are more comfortable with this text than we were with the other versions," he said.
U.S. and British officials, speaking on condition of anonymity, said Pakistan, Russia and China still had reservations but they were confident the minimum nine "yes" votes could be obtained.
The new draft would still call on Sudan to disarm Arab militias blamed for rampant violence in the western region of Darfur.
It requires U.N. Secretary-General Kofi Annan to report every 30 days "and expresses its intention to consider further actions, including measures as provided for in Article 41 of the (U.N. Charter) on the Government of Sudan in the event of noncompliance."
The previous text had specifically threatened "the imposition of sanctions."
The draft also would impose an arms embargo that would apply to individuals, groups or governments that supply the pro-government Arab militias known as Janjaweed or rebel groups.
The Janjaweed have staged a brutal campaign to drive out black African farmers over the last 17 months. At least 30,000 civilians, most of them black villagers, have been killed, more than 1 million displaced and some 2.2 million left in urgent need of food or medical attention.
U.S. Ambassador John Danforth insisted the changes did not weaken the text and said he hoped for a unanimous vote to send a strong message to the Sudanese government to stop the violence.
"It's the potential of sanctions in 30 days," he said, reading the article from a copy of the U.N. charter. "The government of Sudan must fulfill that responsibility to the people of Darfur. If it does not then there will be consequences."
Measures included in the 68-word Article 41 exclude the use of armed force but say "complete or partial interruption of economic relations ... and the severance of diplomatic relations" could be considered.
Danforth stressed the importance of "starting the clock ticking," with the 30-day clause, saying it was crucial to increase pressure on Sudan to rein in pro-government Arab militias who have killed thousands in a brutal campaign against black farmers in Darfur.
Sudan's U.N. Ambassador Elfatih Mohamed Erwa criticized the resolution Wednesday, saying it was politically motivated. He said his government would work with the African Union to stop the violence.
"We are going to work with the African Union, not because there is a set of sanctions, but because we believe that this is the right path," he said.
Egypt, which is not on the Security Council but wields great influence in the Arab world, also said it would try to prevent a resolution threatening sanctions from being adopted.
The Sudanese government, which has accused the international community of meddling, has promised to disarm the militias and says sanctions will only hurt those efforts.
The new draft also retains a clause calling on Sudan to "fulfill its commitments to disarm the Janjaweed militias," as it told Annan it would do on July 3.
The Darfur conflict stems from long-standing tensions between nomadic Arab tribes and their African neighbors over dwindling water and farmland. Those tensions exploded into violence in February 2003 when two African rebel groups took up arms over what they regard as unjust treatment by the government.
U.S. and humanitarian officials have accused the Sudanese government of backing the Janjaweed, a claim the government denies.

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France
The price of unexpected success
Jul 29th 2004 | PARIS
From The Economist print edition
AFP
The prime minister may have saved his skin by doing better than expected at promoting change-but voters are still not impressed
WHEN President Jacques Chirac unexpectedly retained Jean-Pierre Raffarin as his prime minister, despite this year's dismal round of election results, savvy voters felt a game was being played: Mr Raffarin's role was to take the rap for some tough measures that lay ahead. Widespread unrest over a reform of public-health insurance and a move to privatise the electricity utility was widely expected. The unions would take to the streets. Public services would be paralysed. All this confirmed the view that Mr Raffarin was being used as a fall-guy.
Yet as France's parliamentary year ended this week, Mr Raffarin has several grounds for satisfaction. He has survived a vote of confidence. He has also just passed one clutch of reforms, and unveiled a fresh round for the autumn. Has his last-ditch effort to keep his job paid off?
Against the odds, the government has pulled off three important initiatives. The first is a law to turn Electricit? de France, a nest of Communist-backed unionism, into a public company. Although workers will retain their civil-service perks, this opens the way for partial privatisation. The government insists that it will keep a 70% stake, but similar promises have been disregarded in the past. Given the symbolism of EDF, whose powerful unions have petrified previous governments, this change in itself is no small achievement.
Second, the government has passed a law to prop up France's public health-insurance system. Though health care is first-class, costs are out of control. The French are second only to the Americans in popping pills, and spend 9% of GDP on health, second in Europe only to Germany. This year, France's public-health fund deficit is expected to top ?13 billion ($15.7 billion).
The reform stops short of a radical overhaul. Fran?ois Bayrou, a centrist politician, dismisses it as a r?formette. Yet it nevertheless introduces important principles that have long been resisted by politicians and doctors. These include an up-front, non-reimbursable charge (initially one euro) for consulting a doctor; the introduction of computerised and shared medical records, to cut down on duplicated testing and to help diagnoses; and the requirement to be registered with a single family doctor, who will act as a gatekeeper for specialist consultations. Such changes may appear simple common sense, but in France's liberal medical world they are regarded as big infringements on individual freedom. Hoped-for efficiency gains, if achieved, will be accompanied by an increase in social charges to help to control the deficit.
The third reform, guillotined through parliament this week to howls of protest from the opposition Socialist Party--a move which in itself triggered the vote of confidence--decentralises a bit of the civil service. The law devolves certain responsibilities, including national roads, most ports and airports, certain social-housing funds and training schemes, and technical secondary-school employees and caretakers. Some 130,000 civil servants will be transferred to local authorities. The government says it wants to rationalise a labyrinthine public service. It also calculates that it will be less difficult to shed bureaucratic jobs in future if they are not all centrally based.
All of which led Mr Raffarin, flush with his successes, to claim this week that it had been "a great year of reform for France". The health reform in particular, he added, showed that it was possible to modernise France without provoking a choc social. In a bid to reassert authority, he unveiled a fresh burst of reforms for the autumn.
On the labour market, the unemployed will be given incentives and help to find work, including the possibility of benefit cut-offs; discussions will re-open on ways to make the 35-hour week more flexible. On the public service, there will be a reform to ensure that basic trains and other public services operate during strikes, to avoid the habitual paralysis; some 10,000 civil-service jobs will be cut. On education, research will get a big cash injection, while secondary schooling will be reformed. In short, Mr Raffarin seemed to say, he has life left in him yet. Indeed, the man whom many consider a caretaker, has now lasted longer as prime minister than both Alain Jupp?, in 1995-1997, and Mr Chirac's most recent term, in 1986-1988.
All the same, Mr Raffarin can scarcely be complacent. His confidence rating has sunk from a high of 64% in 2002 to just 26% today. Worse, according to the latest monthly popularity ranking from IFOP, a pollster, he ranks a miserable number 32--below both the Communist and the Trotskyite leaders. A majority of deputies in the ruling Union for a Popular Movement (UMP) have now swung behind Nicolas Sarkozy, the ambitious finance minister, for the vacant job as its new boss.
This weakness is partly explained by Mr Raffarin's unpopular reforms. But it also undermines their impact: the prime minister pushes through important reforms with one hand, while handing out concessions to special-interest groups--tobacco sellers, research scientists, part-time theatre technicians--with the other.
Mr Raffarin may have secured his job for the autumn. He certainly reckons on keeping it longer: he has started to plan a campaign for a yes vote in the French referendum on the European constitution, due to be held in late 2005. But the more restless that UMP deputies become, the more his lack of popularity, and authority, will be a problem. If the president keeps him on, it will probably be because--for now--he has no acceptable alternative.
Copyright ? 2004 The Economist Newspaper and The Economist Group. All rights reserved.

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>>ROVE SMILES?

Kerrys raced to dump foreign stocks
By David R. Guarino
Read Guarino's Road to Boston Blog
Thursday, July 29, 2004
John Kerry's family dumped millions of dollars of foreign holdings as he launched his White House bid, gobbling up Made in the USA stocks in a huge politically savvy international-to-domestic shift.
The investments, mostly in the name of Kerry's multimillionaire wife, Teresa Heinz Kerry, sold stock in massive overseas players like Heineken, Sony, British Petroleum and Italian Telecom for red, white and blue companies like McDonald's, Dell and Kohls.
In all, the Kerrys dumped as much as $16 million worth of international stock and bought between $18 million and $32 million in domestic holdings between 2002 and 2003, records show.
The swaps, detailed in Kerry's financial disclosures for the presidential race, come to light as the Bay State senator tonight wraps himself in Americana to accept the Democratic Party nomination.
The senator's campaign said the investments are managed not by the Kerrys but by professional investment managers for the family trustees - of which Heinz Kerry is only one.
Marla Romash, a senior adviser to Kerry, said the financial decisions aren't political.
``The trustees and Mrs. Heinz Kerry have asked these investment managers, who make their own investment decisions, only to take appropriate steps to ensure that investments are responsible and financially prudent,'' Romash said. ``The trustees review these investments periodically with the managers to ensure that these investments are responsible as well as financially prudent.''
But the timing of the sales appears to be an anomaly among a relatively consistent investment pattern.
Through most of Kerry's federal disclosure forms, the Heinz Kerry trusts - which invest some of the massive inheritance after the death of her first husband, Sen. H. John Heinz III, more than a decade ago - show steady investments and sales of overseas assets.
In the spring of 2002, as Kerry seriously began weighing a presidential run, there appeared to be a marked increase in sales of overseas holdings.
The forms, which only list a range of figures, show the trusts sold between $7.2 million and $16.1 million in assets that year. The trust reported dividends of as much as $68,000 on the sales.
Among the assets dropped were: Cadbury Schweppes, the British candy and soda maker - with between $50,001 and $100,000 in stock sold in March 2002; Japan's Canon, Sony and Toyota - with more than $100,000 in each sold in March 2002; and France's Vivendi, Total Fina, Suez and Compagnie De Saint-Gobain.
The records also show the trust sold between $250,001 and $500,000 of BNP Paribas stock in April 2002, before the French bank was ensnared in the Iraqi oil-for-food scandal at the United Nations.
Later that year and in 2003, the trusts began bolstering its domestic holdings - buying more than $50,000 in Harley Davidson stock, more than $100,000 in Costco, more than $250,000 in Kohls, Raytheon, and Kraft Foods, and as much as $1 million in Dell and McDonald's.



PORTRAIT
John Kerry, aristocrate de gauche
LE MONDE | 26.07.04 | 13h30 * MIS A JOUR LE 27.07.04 | 15h21
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Fils de diplomate, remari? ? une riche h?riti?re, le candidat d?mocrate ? la Maison BLanche a tout du privil?gi?. Ses convictions, pourtant, sont plus profondes qu'il n'y para?t.
Le probl?me de John Kerry, ce n'est pas qu'on ne le conna?t pas, c'est qu'on le conna?t trop." "Encore un de ces riches ?litistes de gauche du Massachusetts qui pr?tend ?tre un homme du peuple ! Impayable !" "Il se pr?sente comme un candidat populiste. Sa premi?re femme venait d'une grande famille de Philadelphie, qui p?se 300 millions de dollars. Sa seconde femme est une h?riti?re des cornichons et du ketchup." "Pour se d?fendre de l'accusation d'?tre distant, Kerry cite l'?crivain fran?ais Andr? Gide : "N'essayez pas de me comprendre trop vite !" Pas de probl?me ! Nous n'avons jamais entendu parler d'Andr? Gide."
Dans la campagne pour l'?lection pr?sidentielle du 2 novembre, les caricatures volent bas. Les pol?mistes de droite n'ont pas ? envier l'ardeur des "Bush-haters" ("ha?sseurs de Bush") de gauche. Pour les r?dacteurs de publicit?s t?l?vis?es, les chroniqueurs radio ou les sites Internet r?publicains, John Kerry repr?sente tout ce qu'un conservateur am?ricain d?teste. Il appartient ? la haute soci?t? de Nouvelle-Angleterre, il a v?cu en Europe, il est cultiv?, de gauche, catholique de la tendance tol?rante. Qui plus est, il si?ge au S?nat depuis presque vingt ans, et les "politiciens de Washington" ont, par d?finition, mauvaise r?putation. Il a m?me fini par devenir ami avec l'autre s?nateur du Massachusetts, Edward Kennedy, parangon de la gauche d?mocrate la plus traditionnelle, certains diraient sectaire.
Naturellement, les caricatures ont raison. Elles sont m?me au-dessous de la v?rit?. Il est difficile d'imaginer un homme politique plus compliqu? que John Forbes Kerry. Sa naissance, d?j?, est un d?fi aux id?es re?ues. Son p?re ?tait un diplomate au patronyme irlandais, de confession catholique, form? aux universit?s Yale et Harvard.
Richard Kerry n'a jamais dit ? son fils ce que celui-ci a appris par un article du Boston Globe en 2003 : ses grands-parents ?taient des juifs d'Europe centrale, convertis au catholicisme en 1902 et arriv?s aux Etats-Unis en 1905. Fritz Kohn a emprunt? le nom d'un comt? d'Irlande pour devenir Frederick Kerry. Avec sa femme, Ida, il s'est install? ? Chicago, puis ? Brookline, dans le Massachusetts. Apr?s deux faillites, Frederick Kerry n'en a pas support? une troisi?me et s'est tir? une balle dans la t?te, dans les toilettes d'un h?tel de Boston, en 1921.
La m?re de John Kerry, Rosemary Forbes, appartient ? l'une des familles les plus anciennes de cette grande bourgeoisie de Boston surnomm?e "les brahmanes", tant elle forme une caste s?re de sa valeur et de sa place dans la soci?t?. Les Forbes se sont enrichis dans le commerce avec la Chine - celui de l'opium, entre autres - et poss?dent des terrains ? Cape Cod, lieu de vill?giature des fortunes de Nouvelle-Angleterre.
Le p?re de Rosemary avait ?pous? une descendante de John Winthrop, qui fut, au d?but du XVIIe si?cle, le premier gouverneur du Massachusetts. Ces Forbes-l? vivaient en Bretagne, ? Saint-Briac-sur-Mer. John et Margaret Forbes avaient onze enfants, et c'est ? Saint-Brieuc, o? il ?tudiait la sculpture, pendant l'?t? 1938, que Richard Kerry a rencontr? celle qui est devenue sa femme, trois ans plus tard. Pilote d'essai de l'arm?e de l'air, Richard Kerry a ?t? hospitalis?, pour une tuberculose, dans le Colorado. John est n?, ? Denver, le 11 d?cembre 1943.
Pourtant, bien qu'apparent?s ? la plus ancienne aristocratie de ce pays qui ne conna?t pas les titres de noblesse, le futur s?nateur, ses deux s?urs et son fr?re n'ont pas ?t? ?lev?s dans le luxe. Leur famille maternelle ?tait une branche modeste de la tribu Forbes, et leur p?re ?tait un diplomate de niveau moyen, qui n'a jamais atteint le rang d'ambassadeur.
Quand John, apr?s un s?jour dans une pension suisse, est entr? au coll?ge Saint Paul, dans le New Hampshire, sa scolarit? a ?t? pay?e gr?ce ? la g?n?rosit? d'une grand-tante. A Saint Paul, il ?tait doublement isol?, catholique dans un milieu anglican - la religion des grands bourgeois anglophiles du Nord-Est - et imp?cunieux parmi des jeunes gens aux poches pleines, assur?s de leur avenir et qui trouvaient un peu ?trange de travailler autant qu'il le faisait. "Il ?tait tr?s pugnace", a racont? un de ses condisciples, Danny Barbiero, lui aussi atypique dans cet ?tablissement. Et d'ajouter : "Ce n'?tait pas cool de l'?tre, ? Saint Paul. Vous n'aviez pas ? l'?tre. Vous aviez un droit de naissance."
Le jeune Kerry s'impose par l'effort. Il est bon ?l?ve. Il brille au hockey sur glace, dans une ?quipe dirig?e par Robert Mueller, aujourd'hui directeur du FBI. Il fait du th??tre et joue - ou pr?tend jouer, il y a d?bat sur ce point... - de la guitare basse dans un groupe de rock. Il ?crit dans le journal de l'?cole, o?, en mai 1962, deux mois apr?s les accords d'Evian, qui ont mis fin ? la guerre d'Alg?rie, il publie un curieux po?me sur de Gaulle et le d?clin de l'empire fran?ais.
Il drague les filles, parmi lesquelles une demi-s?ur de Jackie Kennedy, ce qui lui vaut d'assister ? la r?gate de l'America Cup, au large de Rhode Island, sur le m?me voilier que le pr?sident des Etats-Unis. Il commence peut-?tre, alors, ? se croire un destin. En tout cas, quand il entre, la m?me ann?e, ? Yale, il se sent chez lui, dans cette universit? prestigieuse, et tient des discours de plus en plus cat?goriques sur la politique nationale et internationale.
Partisan enthousiaste de John Kennedy, il devient pr?sident de la Yale Political Union, association d'?tudiants qui organise des d?bats politiques. Il est initi?, aussi, ? la myst?rieuse Skull and Bones Society ("Soci?t? des cr?nes et des os"), cette confr?rie de Yale ? laquelle ont appartenu les deux George Bush et qui, comme toutes les soci?t?s secr?tes, excite les imaginations. En fait, on y est coopt? pour ses m?rites, qu'ils soient scolaires, sportifs ou de camaraderie. Y ?tre admis est, ? la fois, un rite de passage - le nouvel arrivant doit, notamment, raconter en d?tail sa vie sexuelle depuis l'enfance - et une voie de socialisation. Sur les quinze membres de Skull and Bones qui ont obtenu leur dipl?me de sortie en 1966, quatre se sont engag?s dans les forces arm?es. Bien qu'il ait pass? une grande partie de son temps, pendant sa derni?re ann?e ? Yale, ? s'initier ? l'aviation, avec son camarade Frederick Smith, futur fondateur de Federal Express, John Kerry a choisi la marine plut?t que l'arm?e de l'air.
L'influence de son p?re, qui s'?tait engag? lui-m?me ? la fin de ses ?tudes, semble avoir ?t? grande, mais ambigu?. Richard Kerry a quitt? le Foreign Service en 1962, las de ses lourdeurs bureaucratiques et amer de ne pas avoir vu ses qualit?s reconnues. Dans un entretien au Boston Globe, en 1996, il a expliqu? qu'il consid?rait la guerre du Vietnam comme "une grave faute politique", mais que son fils voulait "brandir le drapeau"et qu'il ?tait "tr?s immature ? cet ?gard".
En octobre 1965, John Kerry a remis au vice-pr?sident Hubert Humphrey, de passage ? New Haven, dans le Connecticut, o? se trouve l'universit? Yale, une p?tition condamnant les manifestations contre la guerre. Pourtant, sept mois plus tard, choisi pour prononcer le discours de fin d'ann?e universitaire, le jeune engag? critique la politique du pr?sident Lyndon Johnson. "Nous n'avons pas r?ellement perdu le d?sir de servir. Nous nous interrogeons sur les racines de ce que nous servons", dit-il.
L'h?sitation de John Kerry face ? la guerre du Vietnam semble annoncer celle dont il a fait preuve, pr?s de quarante ans plus tard, au sujet de l'Irak. Lui qui s'?tait prononc?, au S?nat, en 1991, contre la premi?re guerre du Golfe, a longtemps tergivers? avant de voter, en octobre 2002, la r?solution autorisant George Bush ? employer la force contre Saddam Hussein.
Un an plus tard, il a refus? le collectif budg?taire de 87 milliards de dollars destin? ? couvrir les d?penses militaires et l'occupation du pays. Dans une d?claration dont les r?publicains n'ont pas fini de se d?lecter, il a expliqu? qu'il avait "vot? pour avant de voter contre". "En effet, c'est beaucoup plus clair comme ?a", ironise le vice-pr?sident, Richard Cheney, de r?union publique en d?ner de collecte de fonds. Le s?nateur a voulu dire qu'il soutenait le projet, avec un amendement d?mocrate pr?voyant de r?duire les baisses d'imp?ts sur les hauts revenus, et qu'il a vot? contre apr?s que cet amendement eut ?t? rejet? par les r?publicains.
La question n'est pas l?, ?videmment. Elle est de savoir si, trois ans apr?s les attentats du 11 septembre, alors que leurs forces sont engag?es en Afghanistan et en Irak, et face ? une menace terroriste qui n'a pas diminu?, les Am?ricains peuvent s'en remettre ? un homme qui para?t craindre de faire la guerre.
A ce doute sur sa d?termination, John Kerry r?pond en invoquant, inlassablement, ses ?tats de service au Vietnam. Il y a ?t? bless? plusieurs fois, il y a abattu au moins un ennemi, il y a sauv? des camarades, il en est revenu d?cor?. "Cela fait trente-cinq ans que je d?montre ce qu'est ma politique", d?clare-t-il dans l'hebdomadaire The New Yorker(dat? 26 juillet). Il a approuv? les interventions dans les Balkans, d?cri?es, ? l'?poque, par les r?publicains. Il a soutenu les actions men?es en Ha?ti et ? Panama. "Je suis clair, dit-il, sur ma volont? d'employer la force, si n?cessaire, pour prot?ger nos int?r?ts dans le monde et, ?videmment, la s?curit? de notre pays." A ses yeux, l'Irak n'est pas un bourbier dont il faudrait sortir au plus vite et ? tout prix, mais une erreur ? r?parer.
A la fin des ann?es 1960 et au d?but des ann?es 1970, John Kerry dirigeait les Vietnam Veterans Against War, les anciens combattants oppos?s ? la guerre. "C'est un fumiste, non ?", demandait Richard Nixon, ?lu pr?sident, en 1968, en promettant de mettre fin ? la guerre et qui l'a prolong?e pendant sept ans. T?moignant au S?nat, avec l'aide d'Edward Kennedy, et ? la t?l?vision, le lieutenant Kerry a d?nonc?, en 1971, les "atrocit?s" que cette guerre faisait commettre aux soldats am?ricains.
Une des cl?s de sa pens?e se trouve peut-?tre dans le livre que son p?re a publi? en 1990, The Star Spangled Mirror ( Le Miroir ?toil?). Richard Kerry y d?non?ait les fautes que peut commettre l'Am?rique quand elle se persuade de sa sup?riorit? et de sa mission civilisatrice. John Kerry ne partage pas le radicalisme de son p?re, mort en 2000, mais il ne cesse de reprocher ? George Bush d'avoir men? "la politique ?trang?re la plus arrogante, la plus inepte, la plus brutale et la plus id?ologique de l'histoire moderne". Il croit ? la n?cessit? des interventions humanitaires, mais, dans le grand d?bat am?ricain sur ce que doit ?tre la politique des Etats-Unis vis-?-vis du reste du monde, il se situe du c?t? des "r?alistes", qui donnent la priorit? aux alliances et ? l'?quilibre des puissances, contre les "id?alistes", qui pr?chent la diffusion de la d?mocratie.
Son mariage, en 1970, avec Julia Thorne, s?ur d'un de ses camarades de Yale, s'est achev?, en 1988, par un divorce. Sept ans plus tard, le s?nateur du Massachusetts a ?pous? Teresa Heinz, veuve d'un de ses anciens coll?gues, le r?publicain John Heinz, mort dans un accident d'avion. H?riti?re des conserves Heinz, Teresa Kerry g?re une immense fortune, et le s?nateur m?ne grande vie, avec elle et leur famille recompos?e, de leur maison de Boston ? celle de Georgetown, quartier chic de Washington, de l'?le de Nantucket aux pistes de ski de l'Idaho, d'une propri?t? ? Pittsburgh, en Pennsylvanie, berceau de la famille Heinz, ? un chalet ? Aspen, dans le Colorado.
Cela n'emp?che pas le candidat d?mocrate de faire partie de ces privil?gi?s qui pensent que l'Am?rique a du chemin ? faire pour tenir ses promesses en mati?re de justice, d'?quit? et de solidarit?. Pour George Bush, c'est "toujours le m?me vieux pessimisme". Pour John Kerry, c'est "la confiance dans ce dont ce pays est capable".
Patrick Jarreau
* ARTICLE PARU DANS L'EDITION DU 27.07.04


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Kerry Spot [ jim geraghty reporting ]
[ kerry spot home | archives | email ]
NRO.COM
TALE OF A TAPE [07/28 11:11 AM]


John Kerry at Kennedy Space Center. Remind you of another Mass. liberal in a tank?
Wednesday morning, the GOP fired one of the biggest guns in its counter-spin arsenal: a twelve-minute video of John Kerry's statements on Iraq and how to handle Saddam Hussein, contrasting his pro-war views of 1998 and 2003 with his antiwar views of 1991 and 2004.
While the charge that John Kerry is a flip-flopper is nothing new, rarely has the case been made so comprehensively, in such detail, relying almost entirely on the Democratic senator's own words.
There are quite a few Kerry quotes that have disappeared down the memory hole that are worth recollecting. Like his statement on Dec. 11, 2001, on The O'Reilly Factor (does it seem shocking now that Kerry once appeared on O'Reilly's show?): "I think we ought to put the heat on Saddam Hussein. I've said that for a number of years, Bill. I criticized the Clinton administration for backing off of the inspections when Ambassador Butler was giving us strong evidence that we needed to continue. I think we need to put the pressure on no matter what the evidence is about September 11."
Got that? Tougher stance than Clinton. Evidence about 9/11 is irrelevant.
Kerry on Larry King Live, several days later: "I think we clearly have to keep the pressure on terrorism globally. This doesn't end with Afghanistan by any imagination. And I think the president has made that clear. I think we have made that clear. Terrorism is a global menace. It's a scourge. And it is absolutely vital that we continue, for instance, Saddam Hussein."
Afghanistan's not enough. Continue the fight. Take Saddam Hussein.
Then this exchange with Chris Matthews on Feb. 5, 2002: Matthews asked, "Do you think that the problem we have with Iraq is real and it can be reduced to a diplomatic problem? Can we get this guy to accept inspections of those weapons of mass destruction potentially and get past a possible war with him?"
"Outside chance, Chris," Kerry responded. "Could it be done? The answer is yes. But he would view himself only as buying time and playing a game, in my judgment. Do we have to go through that process? The answer is yes. We're precisely doing that. And I think that's what Colin Powell did today."
There was no complaining then about a "rush to war." No warnings that Saddam Hussein's WMD programs might not be as advanced as the administration feared. No skepticism about the intelligence, no blood-for-oil, no conspiracy theories about Chalabi and Halliburton and neocons.
Finally, his speech to the Democratic Leadership Council's national convention on July 29, 2002: "I agree completely with this administration's goal of a regime change in Iraq."
What makes the video more than a collection of Kerry's rhetorical hits is its documentation of how outside events were influencing the Democratic senator's political positions. Specifically, as 2003 wore on, Howard Dean rocketed to the top of the Democratic-primary polls and garnered laudatory press coverage. And Kerry obviously, blatantly, started borrowing Dean's anti-war rhetoric.
By August 2003, Kerry was declaring on Meet the Press, "The fact is, in the resolution that we passed, we did not empower the president to do regime change."
By October, the struggling Kerry was insisting that the war he had said he "agreed completely with" was unnecessary. "But the president and his advisors did not do almost anything correctly in the walk-up to the war. They rushed to war. They were intent on going to war. They did not give legitimacy to the inspections. We could have still been doing inspections even today, George."
Remember, the previous February, Kerry had dismissed diplomatic negotiations for more inspections as Saddam's "buying time and playing a game."
Judging by the 100-percent certainty with which Kerry made both sets of comments, he doesn't seem to even acknowledge that they contradict each other. Both appear to accurately express his views at the moment he speaks them.
The point is that there isn't truth or untruth to Kerry's views. There is simply what is needed and what is not needed, and the True North of Kerry's rhetorical and policy compass is whatever he needs politically at that time.
George Clooney's character in Three Kings, a film about the first Gulf War, explains to three soldiers under his command that "the most important thing in life is necessity... As in people do what is most necessary to them at any given moment."
What does Kerry stand for? Whatever is most necessary to him at that particular moment.
One could say that's not unique to Kerry, and may be a common trait among politicians. But what would this mean in a president? Periodically, Sen. Edward Kennedy or some other Democrat will make the stupendously illogical charge that George W. Bush made the call to go to war in Iraq in order to boost his poll numbers. But the political boost from a war, the rally-around-the-flag effect, is notoriously short lived. Winston Churchill won World War II and got tossed out on his tush by British voters almost the moment the war ended.
President Bush didn't decide to got to war to boost his poll numbers. In spite of the near-certainty that it would erode his high poll numbers after toppling the Taliban, Bush made the decision to go ahead.
What would John Kerry do in a similar situation? How dire would a threat have to be for him to risk his popularity on an unpopular war? Or would he put his faith in diplomacy with dictators and agreements with rogue states -- "buying time and playing a game," as he once described it?
Before the voters can consider that question, Kerry's long and meandering views on Iraq have to be brought front and center before the millions of Americans who are not paying close attention to this race. Unfortunately, this video format doesn't lend itself well to the traditional methods.
It's way too long to condense into a 30- or 60-second ad. If it were shown during the GOP convention, it would be putting the spotlight on the challenger instead of the president, and much of the media would explode with fury at the "negative campaigning." Some political shows might spotlight it, but few would be willing to let it run for the entire eleven minutes. Maybe C-SPAN will show it. Perhaps it could serve as the entertainment for the Bush "House Parties."
Maybe talk radio could run the audio of the tape uninterrupted.
A GOP source says the idea of buying airtime on the networks, like H. Ross Perot did in 1992, has been tossed around. One way or another, this 11-minute tape will be coming to a place near you in the not-too-distant future.
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>> WHAT REALLY HAPPENED IN BOSTON...

The Party's Parties
Lavish Parties Lead to Access at Nominating Convention

By Meredith O'Brien

WASHINGTON, July 8, 2004 -- At this year's Democratic national convention in Boston, special interests are planning and paying for a reported 200 private parties and receptions for lawmakers and party officials. Corporations, unions, lobbying firms and interest groups will host the Democratic elite at nightclubs, fine dining establishments, museums--even Fenway Park.

Though party officials will not comment on or release a list of the parties, the Center for Public Integrity has identified 70 events, 33 of which are hosted by Boston 2004, the private host committee designated to raise funds and organize welcoming events for the convention. The remaining parties have as sponsors the likes of insurance giant American International Group, biotech firm Genzyme, telecommunications firms Time Warner and Comcast, lobbying firms Patton Boggs LLP and Foley Hoag LLP, unions including the AFL-CIO and the International Brotherhood of Carpenters, and trade groups like the American Gas Association and the National Association of Broadcasters.

Corporations and unions used to be able to curry favor with lawmakers by pouring unlimited amounts of cash into the soft money coffers of one or both major political parties. Organizations and issue oriented groups used to show their affection and keen interest in parties' actions the same way, making sure that their money kept them in the game.

But now that once healthy spigot of unlimited campaign cash has been shut off by campaign finance laws prohibiting soft money donations, companies and interest groups have sought out other ways to show the political parties that they're players too, and to make sure that the next time a bill or policy they're interested in crops up, that they are consulted.

One solution: Lavish parties at the presidential nominating conventions.

In the words of one campaign finance expert, they are raising party planning "to an art form." While exclusive parties are not new to the convention scene, watchdog groups say this year's receptions will be more extravagant to make up for the absence of soft money donations. "This year, the number of private affairs is expected to far exceed previous conventions," wrote Bill McConnell in the trade publication, Broadcasting and Cable. "Independent party planners will throw nearly 50 blowouts costing $100,000 or more each, according to estimates."

However, the precise number of parties and where they're being held is a quasi-secret, reserved for only those in the know. When asked by the Center for Public Integrity for a list of private parties and receptions to be held in Boston during the late-July convention, the spokeswoman of the city's host committee, Boston 2004, played it close to the vest. "We have nothing to do with that," said Spokeswoman Karen Grant. "There's nothing coordinated." But the Boston Globe reported in June 2004 that it had obtained a "confidential calendar of private events, produced by the Boston 2004 convention host committee . . . [showing] nearly 200 receptions, luncheons and after-hours parties."

The official parties
There are official parties of course, hosted by Boston 2004, some 33 of them--at a total $1.8 million price-tag--at locations around the Hub, from museums, historic sites and parks, to a brewery, a cookie factory and university campuses. The biggest one is the reception for 15,000 members of the media at the just opened Boston Convention and Exhibition Center facing Boston Harbor. The Boston Globe is one of the sponsors for the $800,000 shindig, geared toward putting the best face on the city for the media who will project its image to the world for a week. The paper is contributing $500,000.

The other official gatherings are welcoming parties for the 56 state and territorial delegations attending the convention. Some delegates will be feted in historic style--the Pennsylvania delegation in the gold-domed State House on Beacon Hill and the hometown favorites, the Massachusetts delegation, in the grand Boston Public Library.

Others will be treated to unique receptions. Ohio delegates, for example, will be meeting at the Samuel Adams Brewery. Minnesota and North Dakota delegates will be welcomed at the Dancing Deer Baking Company, home to the "Break the Curse" molasses clove cookie, in honor of the Boston Red Sox's long World Series championship drought which coincided with the team trading Babe Ruth to the New York Yankees.

On a less culinary note, the New Jersey delegates will gather in the Charlestown Navy Yard at the U.S.S. Constitution Museum, home of the over 200-year-old ship, while the California delegates will be consorting with wild life at the Franklin Park Zoo.

The unofficial parties
While the official parties are sure to be interesting, look for the real political action elsewhere, like at the Bay Tower Room with panoramic views of the city, or at Felt, the uber hip nightclub, or even at Locke-Ober, the high-end French restaurant favored by Boston's political establishment.

These are among the sites of some of the private gatherings slated for select Democrats during convention week. Companies ranging from telecommunications giants to insurance, fuel, bio-tech and financial institutions are ponying up hundreds of thousands of dollars to honor and fete those with power.

"It's not an opportunity that we want to let slide by," Daphne Magnuson, spokeswoman for the American Gas Association (AGA) told the Boston Globe, adding that the group has budgeted $700,000 to stage parties at the Boston and New York national conventions this summer.

The AGA has at least four events slated for the convention week, according to press reports. The trade group will host a dinner honoring Sen. Max Baucus, the ranking Democrat on the Senate Finance Committee, a late-night reception for the Congressional Hispanic Caucus at a hopping nightclub, luncheons in the honor of Sen. Byron Dorgan and Sen. Jeff Bingaman of the Senate Energy and Natural Resources Committee and a reception for governors, according to the Boston Globe.

Two events are rivaling one another for the honor of being the hottest event in town: The Creative Coalition's benefit gala at Louis Boston, home of the Asian/French fusion Restaurant L in the city's high-end shopping area (Newbury Street), and the gala for Massachusetts Sen. Ted Kennedy at Boston Symphony Hall.

The Creative Coalition--a group comprised of members of the arts and entertainment community--has the upper hand when it comes to Hollywood wattage. It's lined up celebrities like Boston's home boy Ben Affleck, Oscar winner Chris Cooper, actor William Baldwin and actress/Air America talk show host Janeane Garofalo to attend a fundraiser for the non-profit group, hosted with the Recording Industry Association of America, Esquire, Allied Domecq and Volkswagen. Alternative rockers the Red Hot Chili Peppers are scheduled to perform at the fundraiser. Tickets to the event range from a low of $1,000 for one ticket, to $50,000, which would buy you 40 tickets, gift bags, 20 VIP tickets and Green Room Access, according to the Creative Coalition's site, which lists issues such as arts and music education, First Amendment rights, gun control and campaign finance reform as topics of importance to the group.

But when it comes to old fashioned political clout, the party for Kennedy, featuring Yo-Yo Ma and the Boston Pops, with conductor John Williams, is a strong competitor. The event, which is estimated to cost $400,000-$600,000, is being sponsored by a handful of corporations and unions, including, Raytheon, Bristol-Myers Squibb, the AFL-CIO and the International Brotherhood of Carpenters, which all gave $100,000 each, according to the Boston Globe.

Kennedy will receive more accolades at the Boston Park Plaza Hotel when the Irish American Democrats and the Italian American Democratic Leadership Council team up for a reception. U2 lead singer Bono and Stephen Stills are among the celebrity guests. Kennedy, along with Rep. Mike Capuano, also of Massachusetts, is scheduled to make an appearance at the Biotechnology Industry Organization's reception at the Museum of Science that week.

For Democratic governors making the sojourn to Boston, many groups are awaiting them. The AGA is planning a reception for them at Ned Devine's Irish Pub in Faneuil Hall. There's going to be a Boston Harbor waterfront "All-Star Salute to Democratic Governors" on Rowe's Wharf, according to the Democratic Governors' Association's web site. And, in honor of those All-Stars, the governors will head to Fenway Park for what's being billed as "an afternoon at one of America's most storied ballparks," brought to them by UBS Financial Services.

Meanwhile members of the Congressional Hispanic Caucus will be honored by the Congressional Hispanic Caucus Institute with a reception at the swank nightspot, Felt, sponsored by the AGA. Listening to the tunes of Los Lobos, members of the caucus may be able to mingle with special invited guests New Mexico Gov. Bill Richardson and Sen. Hillary Rodham Clinton. Sponsorship ranges from $25,000 to $50,000, according to the group's web site.

Clinton will be featured at a number of events during the convention, including a lunch at Locke-Ober, a restaurant famed for its JFK room and JFK lobster stew, sponsored by American International Group, reports the Boston Globe. The senator and her husband, former President Bill Clinton, will be honored at the State Room restaurant with views of the city; the 500-person event is being held by Democratic fundraiser and contributor Elaine Schuster and other donors, according to press reports. Another Boston night club, Avalon, will be the site of a gathering for New York lawmakers, including Clinton, that's expected to be attended by 2,000 people.

Massachusetts Congressman Bill Delahunt, looking to capitalize on the party going, is hosting a campaign fundraiser at a championship golf club, Granite Links in nearby Quincy. For $2,000 per ticket, one can participate in the golf tournament and enjoy the clambake afterwards, according to the Hill. For non-golfers, they can chip in $1,000 and just go for the food.

One of the most talked about parties is Louisiana Sen. John Breaux's Caribbean bash, sponsored by more than a dozen media lobbyists, according to Broadcasting & Cable. Featuring jerk chicken, Red Stripe beer and the tunes of Ziggy Marley and Buckwheat Zydeco, the $300,000 party for more than 1,000 will be held at the New England Aquarium.

Below is a list of parties compiled by the Center for Public Integrity from news reports and Internet searches. (It is not a comprehensive list of all, unofficial events.)

Official parties (Sponsored by Boston 2004 and others as noted)
Party thrown for Given by Location Type of location Date
Media Boston Globe and Boston 2004 Boston Convention & Exhibition Center Reception 24-Jul
New Jersey delegation Boston 2004 Navy Yard Constitution Museum Historic naval yard, Charlestown 25-Jul
South Dakota delegation Boston 2004 Navy Yard Commandant's House Historic naval yard, Charlestown 25-Jul
Nevada delegation Boston 2004 Navy Yard Pier 1 Historic naval yard, Charlestown 25-Jul
Iowa and Missouri delegations Boston 2004 New England Aquarium, downtown Aquarium 25-Jul
Texas delegation Boston 2004 Hyatt Harborside East Boston 25-Jul
Washington, Idaho, Montana, Wyoming delegations Boston 2004 Museum of Science, downtown Museum 25-Jul
Michigan delegation Boston 2004 State Street Financial Center, Chinatown 36-story, high-rise building in Financial District 25-Jul
New York Delegation Boston 2004 L Street Bathhouse, South Boston Recreation Center 25-Jul
Louisiana, Kansas, Nebraska delegations Boston 2004 Wang Center, downtown Performance Hall 25-Jul
DC, Maryland, Delaware delegations Boston 2004 Children's Museum, downtown Interactive museum 25-Jul
Arizona, New Mexico, Utah delegations Boston 2004 Jorge Hernandez Cultural Center, South End Municipal center 25-Jul
North Carolina delegation Boston 2004 Student Center at the University of Mass.-Boston University campus 25-Jul
Wisconsin delegation Boston 2004 Boston Nature Center Nature center 25-Jul
Virginia, West Virginia delegations Boston 2004 Hyde Park Library, Menino Wing Library 25-Jul
Puerto Rico, US Virgin Island delegations Boston 2004 Adams Park, Roslindale Park 25-Jul
Ohio delegation Boston 2004 Samuel Adams Brewery Brewery 25-Jul
Tennessee delegation Boston 2004 James Michael Curley House, Jamaica Plain Historical building 25-Jul
Guam, American Samoa, Alaska, Hawaii delegations Boston 2004 Millennium Park, West Roxbury Park 25-Jul
Indiana delegation Boston 2004 Strand Theater Performance Hall 25-Jul
Minnesota and North Dakota delegations Boston 2004 Dancing Deer Baking Company, Roxbury Cookie makers 25-Jul
Florida delegation Boston 2004 Northeastern University University campus 25-Jul
Connecticut, Maine, NH, VT, RI delegation Boston 2004 Museum of Fine Arts, Fenway area Museum 25-Jul
Georgia delegation Boston 2004 Shirley-Eustis House Historical building 25-Jul
South Carolina, Alabama delegations Boston 2004 Museum of the National Center of Afro-American Artists, Roxbury Museum 25-Jul
California delegation Boston 2004 Franklin Park Zoo Zoo 25-Jul
Oklahoma delegation Boston 2004 Parkman House, Beacon Hill Historical building 25-Jul
Illinois delegation Boston 2004 Institute of Contemporary Art, Back Bay Art gallery 25-Jul
Pennsylvania delegation Boston 2004 State House, Beacon Hill State House 25-Jul
Massachusetts delegation Boston 2004 Boston Public Library, Back Bay Library 25-Jul
Arkansas, Kentucky, Mississippi delegation Boston 2004 Spangler Center at Harvard Business School, Allston University campus 25-Jul
Oregon delegation Boston 2004 Boston Latin School, Mission Hill School campus 25-Jul
Colorado delegation Boston 2004 Home of ambassador Swanee Hunt, Cambridge Private home 25-Jul


Source: Boston 2004 web site, web sites, news reports

Unofficial parties (Sponsored by private groups, businesses and organizations)
Party thrown for Given by Location Type of location Date
The Creative Coalition and the Recording Industry Association of America Benefit gala hosted in association with Esquire, Allied Domecq & Volkswagen Restaurant L, described by Zagat Survey as Asian and French fusion food. Restaurant 28-Jul
Democratic Governors' Assn Democratic Governors' Assn Boston Harbor Waterfront "All-Star Salute to Democratic Governors," "Rock the Harbor" opening reception, Rowe's Wharf Overlooking the Harbor 25-Jul
New York Delegation Unclear Avalon, Landsdowne Street, Boston Nightclub 28-Jul
Former President Bill and Sen. Hillary Clinton Elaine Schuster and other donors State Room, Boston Restaurant in Bay Tower overlooking the city 25-Jul
Sen. Ted Kennedy A half dozen corporations and unions, including Raytheon, Bristol Myers Squibb, AFL-CIO, and International Brotherhood of Carpenters Boston Symphony Hall, home of the Boston Symphony & Pops Performance hall 27-Jul
Sen. Hillary Clinton and NY lawmakers AIG (insurance) Locke-Ober, Boston Restaurant 28-Jul
Fundraiser for Rep. Bill Delahunt (Mass.) Rep. Bill Delahunt Granite Links championship Golf Club overlooking Boston Harbor Country club Unknown
Sen. Hillary Clinton and Michigan Gov. Jennifer Granholm Emily's List Boston Convention & Exhibition Center Convention center 27-Jul
Sen. John Breaux, Louisiana Media lobbyists New England Aquarium Aquarium 27-Jul
Sen. Ted Kennedy and other lawmakers Irish American Democrats and Italian American Democratic Leadership Councils Park Plaza Hotel 25-Jul
New England delegation Genzyme Genzyme headquarters, Cambridge Biotech firm headquarters 26-Jul
Sen. Ted Kennedy and Rep. Michael Capuano (Mass.) Biotechnology Industry Organization (BIO) Museum of Science Museum 28-Jul
Congressmen and staff Biotechnology Industry Organization (BIO) Genzyme HQ, Cambridge Luncheon at biotech firm Unknown
Delegates Time Warner Tia's, Boston Restaurant on Long Wharf with waterfront view 25-Jul
Senate Minority Leader Tom Daschle and Senate Democratic Whip Harry Reid Comcast, Citigroup and other sponsors Dinner Restaurant Unknown
Lawmakers Fox News Concert at Fenway Park Baseball park Unknown
Senate Democrats Consumer Electronics Association and other sponsors Unknown Unknown Unknown
Sen. Max Baucus, (Mont.), ranking member of the Finance Committee American Gas Association Unknown Unknown 26-Jul
Congressional Hispanic Caucus American Gas Association Late night reception at Felt Nightclub 26-Jul
Sen. Jeff Bingaman (N.M.) and Sen. Byron Dorgan, (N.D.), members of Energy & Natural Resources Committee American Gas Association Unknown Unknown Unknown
Democratic Governors' Assn American Gas Association Ned Devine's Irish Pub, Faneuil Hall Restaurant 28-Jul
Rep. Barney Frank (Mass.), ranking member of the House Financial Services Committee Financial Services Roundtable Bay Tower, Boston Restaurant in a high rise with views of city July 27-28
Rep. Ed Markey (Mass.), ranking member on the House Telecom and Internet Subcommittee Massachusetts Broadcasters Association and National Association of Broadcasters Boston College Club, Boston Private club 26-Jul
Massachusetts Congressional delegation Patton Boggs LLP and Mass Mutual Financial Group Dinner Unknown 26-Jul
Congressmen from Massachusetts, Connecticut, New Hampshire, Rhode Island, New Jersey and Pennsylvania Sovereign Bank New England Reception, Fenway Park, .406 Club Baseball park skybox 26-Jul
Democratic Women Bingham McCutchen, The Alliance of Women's Business & Professional Organizations, The Boston Club, the Massachusetts Women's Political Caucus and Women's Bar Assn of Massachusetts Bingham McCutchen law firm Law firm offices Unknown
Democratic National Convention Chairwoman Alice Huffman Foley Hoag LLP and the United Way of Massachusetts Bay (Luncheon) Unknown Unknown Unknown
Planned Parenthood Foley Hoag LLP Unknown Unknown Unknown
Naismith Memorial Basketball Hall of Fame Foley Hoag LLP (Fundraising reception) Unknown Unknown Unknown
LGBT delegates, Massachusetts AFL-CIO and Massachusetts legislators Bay State Stonewall Democrats Goulston & Storrs, Boston Law firm offices 25-Jul
Sen. Tim Johnson, (S.D.), member, Banking, Housing and Urban Affairs Committee Securities and bond market groups Unknown Unknown Unknown
Blue Dog Coalition A dozen trade groups and companies Roxy, Boston Nightclub Unknown
Sen. John Breaux (La.) The Creative Coalition and Congressional Quarterly blu, restaurant at Sports/LA, Boston Restaurant at a health club 27-Jul
The Creative Coalition, Music for All Foundation, National Association of Music Merchants (NAMM) The Creative Coalition, Music for All Foundation, National Association of Music Merchants (NAMM) Sports Club/LA, Boston Health club 27-Jul
Emily's List and Revolutionary Women Emily's List and Revolutionary Women Boston Convention & Exhibition Center Convention center 27-Jul
Bay State Stonewall Democrats Bay State Stonewall Democrats John Hancock Hall, Boston Concert hall 27-Jul
Rep. Barney Frank (Mass.) Bay State Stonewall Democrats Marriott Copley, Boston Hotel 29-Jul
Democratic Governors' Association UBS Financial Services Fenway Park Baseball park 28-Jul


Sources: Boston Business Journal, The Boston Globe, The Boston Herald, Broadcasting & Cable, The Hill, National Journal, Roll Call, Times-Picayune, various organizations' web sites



>> LEFT WATCH...BANG THE DRUM SLOWLY?


The Condition of the Working Class in China
On March 16 the AFL-CIO filed a remarkable petition with the U.S. government asking that the U.S. trade representative take action to promote the human rights of China's factory workers. The petition charged that China's brutal repression of internationally recognized workers' rights constitutes an unfair trade practice under section 301 of the Trade Act of 1974. It was the first time in the history of section 301 that a petition has invoked the violation of workers' rights as an unfair trade practice, although it is quite common for corporations to use section 301 to challenge other unfair trade practices, such as violation of intellectual property rights.
The petition thoroughly documents the Chinese government's systematic violation of workers' rights and demonstrates how such exploitation costs hundreds of thousands of U.S. manufacturing jobs and puts downward pressure on wages around the world.
The petition attracted enormous attention around the world. BusinessWeek claimed it was a "milestone" that "articulated a coherent intellectual position that makes a logical link between trade and labor rights." Even the Washington Post editorial page, which has always been fierce in its opposition to linking trade and labor rights, stated that the petition deserved "qualified sympathy."
On April 29 the Bush administration rejected the petition. While refuting none of the charges made in the petition, the administration referred to it as an example of "economic isolationism." Tom Donahue, the president of the U.S. Chamber of Commerce, was perhaps more honest about why the petition was rejected: "Had the administration accepted the petition . . . we would have married forever human rights and trade, and that would have been a huge mistake."
One wishes Mr. Donahue had explained himself a bit more: a mistake for whom? For ruthlessly exploited workers in China? For laid off manufacturing workers in the United States? Or for American business, which is complicit in and profits from, the exploitation described below?
We are glad to reprint an edited excerpt (minus the footnotes) of the AFL-CIO's petition. The principal author of the petition is Mark Barenberg, a professor of international law at Columbia University. The entire petition, over 100 pages long with 346 footnotes, can be downloaded from the AFL-CIO's Web site at http://www.aflcio.org/issuespolitics/globaleconomy/upload/china_petition.pdf . Eds
Each year, millions of Chinese citizens travel from impoverished inland villages to take their first industrial jobs in China's export factories. Young and mostly female, they are sent by their parents in search of wages to supplement their families' income. They join an enormous submerged caste of temporary factory workers who are stripped of civil and political rights by China's system of internal passport controls.
They enter the factory system and often step into a nightmare of twelve-hour to eighteen-hour work days with no day of rest, earning meager wages that may be withheld or unpaid altogether. The factories are sweltering, dusty, and damp. Workers are fully exposed to chemical toxins and hazardous machines, and suffer sickness, disfiguration, and death at the highest rates in world history. They live in cramped cement-block dormitories, up to twenty to a room, without privacy. They face militaristic regimentation, surveillance, and physical abuse by supervisors during their long day of work and by private police forces during their short night of recuperation in the dormitories.
They can do little to relieve their misery. Their movements are controlled by the Public Security forces, who ruthlessly enforce the pass system. They are not permitted to seek better-paying jobs reserved for privileged urban residents. If they assert their rights, they are sent back to the countryside, or worse. Attempts to organize unions or to strike are met with summary detention, long-term imprisonment, and torture.
Enmeshed in bonded labor, they frequently cannot even leave their factory jobs, no matter how abusive. They have minimal access to China's legal system, which, in any event, is corrupted by the local Party officials, who extract personal wealth from factory revenue. Their impotence is reflected in their desperate acts of violence and their shocking rate of suicides intended to draw attention to their plight.
Unremitting repression of labor rights robs China's workers of wages, health, and dignity. By lowering wages by between 47 percent and 85 percent, the repression also diverts millions of manufacturing jobs from countries where labor rights are not so comprehensively denied, increasing unemployment and poverty among workers in developed and developing countries. Highly conservative methodologies show that China's labor repression displaces approximately 727,000 manufacturing jobs in the United States alone, and perhaps many more.
China's current level of investment in new factories is unprecedented and will deliver an even greater supply shock to global industry in the next five years, producing even greater losses in U.S. manufacturing jobs-unless the president takes decisive action. Developing countries such as Bangladesh and Indonesia will each lose up to one million manufacturing jobs to China, and Central America and the Caribbean will lose up to one half million jobs in the textile and apparel sector alone. Workers in all countries have a common interest in safeguarding the human rights of China's factory workers.
This petition is not targeted against "free trade" or against China's "comparative advantage" in global markets. Rather, this petition challenges the artificial and severe reduction of China's labor costs below the baseline of comparative advantage defined by standard trade theory. China reduces labor costs by a system of government-engineered labor exploitation on a scale that is unmatched in the present global economy.
The American Federation of Labor and Congress of Industrial Organizations (AFL-CIO)-whose constituent unions represent more than thirteen million workers in the United States, including more than two million manufacturing workers-files this petition under sections 301 and 302 of the Trade Act of 1974, as amended, seeking action by the president to end the Chinese government's unremitting repression of the rights of its manufacturing workers.
Section 301(d) of the Trade Act provides that a trading partner's persistent denial of workers' internationally recognized rights constitutes an unreasonable trade practice. These basic workers' rights include freedom of association; the right to bargain collectively; freedom from compulsory labor; and standards for minimum wages, hours of work, and occupational safety and health. This petition shows that the People's Republic of China (PRC) persistently denies these rights.
China has signed many toothless international agreements requiring it to enforce workers' rights and broken them all. It is therefore appropriate that the U.S. trade representative impose trade remedies against China commensurate with the cost advantage caused by China's repression of workers' rights.
The purpose of the trade remedies is not protectionist. They are, rather, intended to bring about positive change for China's workers and to ensure fair global competition for workers everywhere. In this spirit, the USTR should also negotiate a binding agreement with China, specifying incremental decreases in the trade remedies if China increasingly complies with workers' rights, measured by specific and verifiable indicators. When China fully protects the basic rights of its workers, it can enjoy normal access to U.S. markets and create jobs that are not an affront to human dignity.
Congress first mandated that our trading partners enforce workers' internationally recognized rights in the mid-1980s. One explicit goal of Congress was to implement the Universal Declaration of Human Rights of 1948, which declares that unionization, employment, and adequate wages are fundamental human rights.
Even before the dramatic acceleration in the flow of manufacturing jobs to China in the last few years, Congress had concluded that "[t]he lack of basic rights for workers" in developing countries is "a very important inducement for capital flight and overseas production by U.S. industries."
Congress also recognized that the denial of workers' fundamental rights distributes the benefits of economic growth to "narrow privileged elites," thereby "retarding economic development." Congress was right. Econometric analysis of cross-country data for a large sample of economies in the 1980s and 1990s confirms that the denial of labor rights reduces wages and economic growth, increases inequality, and hampers democratic development.
China's denial of workers' rights is encouraged by a system of world trade and finance that fails to enforce minimum standards of decency at work. Low-wage countries compete for mobile capital. Even if political elites wish to raise the labor standards of their people, they face extreme pressure not to do so, in the absence of global standards that ensure that their competitors will do the same.
Like the discredited laissez-faire regimes of the nineteenth century, today's global rules protect rights of property, contract, and capital but not fundamental rights of personhood, community, and labor. Section 301(d) embodies an alternative model, in which human and social rights are the necessary precondition to democratic and equitable development. Consistent with that model, section 301(b) authorizes the president not only to take trade action to improve China's immediate labor-rights practices but to take any action within his foreign-affairs power to change the rules of trade and finance that encourage China's violations.
The president should therefore refuse to enter into any new trade agreements under the auspices of the World Trade Organization, until that organization gives protection to workers' fundamental rights that is equivalent to the protection given to commercial interests.
The Model of Economic Development
Embodied in Section 301(d)
Petitions under sections 301 and 302 are typically filed by U.S. corporations seeking to protect their commercial interests against unfair trade practices by foreign governments. Those unfair trade practices include barriers to imports from the United States, subsidies of exports to the United States, failure to enforce the intellectual property rights of U.S. companies, and many others.
The workers' rights provisions of section 301 are distinctive in several ways. First, unlike other unfair trade practices enumerated in section 301, the workers' rights provisions are aimed at safeguarding fundamental human rights. That aim cannot be dismissed as "protectionist." The goal of those provisions, and of this petition, is not to deny jobs and economic advancement to China's workers. To the contrary. The goal is to use the enormous economic leverage of the United States to induce positive change in China-to achieve respect for the basic rights of China's factory workers.
In 1984, when Congress first authorized the president to use this type of leverage, it made this purpose plain:
The United States has embraced labor rights, in principle, as well as political rights for all of the people of the world upon adoption of the Universal Declaration of Human Rights in 1948. The Declaration specifically affirms for each person the right to a job, the right to form and join unions, and the right to an adequate standard of living.
Second, section 301 presupposes that securing the fundamental rights of China's workers is concordant with, and indeed a precondition to, protecting the fundamental rights of U.S. workers. Section 301 protects the rights of U.S. workers against erosion by unfair competition with overseas workers who are denied those rights. Congress knew that
the lack of basic rights for workers in many [less developed countries] is a powerful inducement for capital flight and overseas production by U.S. industries.
In evaluating the burden on U.S. commerce caused by China's violations of workers' rights, the USTR should therefore focus on the impact on employment, wages, and associational rights of U.S. workers-not on the revenue and profit of U.S. multinational corporations, which may indeed benefit from the exploitation of overseas labor. Under section 301, those profits are ill-gotten and cannot constitute a "benefit" that offsets the burden on U.S. workers. For the same reason, Congress could not have intended that the USTR count the cheaper price of U.S. imports produced by China's exploited workers as a "benefit" to U.S. commerce that offsets the burden on U.S. workers. In any event, U.S. consumers themselves do not wish to buy goods that are cheapened by shattered workers' rights in China and tainted by shattered working lives in the United States.
Third, the workers' rights provisions of section 301 are a sharp alternative to the model of globalization now embodied in the WTO. In the latter-the model of a laissez-faire constitution-it is enough to protect global rights of property, contract, and investment. Congress, to the contrary, recognized that an economic constitution lacking social rights will not produce equitable and sustained economic development, whether for developing or developed countries:
[P]romoting respect for internationally recognized rights of workers is an important means of ensuring that the broadest sectors of the population within [developing countries] benefit from [access to U.S. markets]. The capacity to form unions and to bargain collectively to achieve higher wages and better working conditions is essential for workers in developing countries to attain decent living standards and to overcome hunger and poverty. The denial of internationally recognized worker rights in developing countries tends to perpetuate poverty, to limit the benefits of economic development and growth to narrow privileged elites, and to sow the seeds of social instability and political rebellion.
In the model of development embodied in section 301(d), the global integration of labor markets, capital markets, and markets in goods and services is not intrinsically a bad thing. If workers' rights are vigorously enforced, then the impoverished and underemployed-whether in China, India, Indonesia, Mexico, or the United States-may improve their standard of living and generate new domestic demand in a virtuous cycle of equitable development, while providing new markets for overseas investors and workers, including those in the United States.
If, however, the workers' rights of one-quarter of the world's workforce are radically suppressed-as they, in fact, are in China-then labor conditions for the world's unskilled and semiskilled workers are worsened; domestic and global demand is depressed; excess productive capacity is created; and a path of inequitable, unsustainable development is promoted.
And when the fundamental right of association is denied, a crucial pillar of democratic governance is lost. The right to form autonomous associations in civil society is a precondition to resisting state tyranny and to mobilizing citizens for participation in pluralist political institutions. In recent years, autonomous worker organizations helped democratize such countries as South Africa, Brazil, Poland, and South Korea-a fact that is not lost on leaders of the Chinese autocracy.
Repudiation of Free Labor Markets
China is now moving up the technology ladder at a rapid pace, becoming an export powerhouse in such sectors as high-technology electronics and precision machinery. Yet, in the post-Mao era of economic reforms, there is still nothing resembling a free labor market in the manufacturing sector. Quite the contrary. Through an extraordinary feat of state engineering, China created and perpetuates an enormous sub-caste of factory workers. The existence of the sub-caste is one of the preconditions of China's superheated investment in manufacturing. The real earnings of this sub-caste have remained static or fallen throughout the unprecedented boom in capital investment. China will continue to serve as the world's sweatshop, producing low-technology goods alongside high-technology goods for decades to come-unless the Chinese government radically reverses course and dismantles its controls over factory workers.
There are more than 750 million workers in China-more than the workforce of all OECD countries combined. China's 2002 census showed approximately 160 million in manufacturing and mining, nearly twelve times the manufacturing workforce in the United States. China's manufacturing workers are employed in several different types of enterprises-privately invested enterprises (PIEs), joint-ventures, foreign-invested enterprises (FIEs), urban collectives and cooperatives, township and village enterprises (TVEs), and state-owned enterprises (SOEs).
To the extent that the Western media and public have any knowledge of these enterprises, they may be most familiar with images of large showcase factories owned by Western multinational corporations that have come under pressure from consumer and labor activists. But the vast majority of export workers labor in other facilities, out of public view, producing either directly for export or as subcontractors for larger export enterprises.
Large concentrations of manufacturing enterprises are located in the well-known coastal export regions of the Pearl River Delta (Guangdong) and Yangtze River Delta (Shanghai and Jiangsu). But literally hundreds of towns and cities throughout China have declared themselves export zones. Local officials compete for investment. They benefit personally by extracting revenue from enterprises and workers.
China has approximately 780 million peasants. Between 180 and 350 million are estimated to be "excessive" or in "dire poverty" and available for urban employment. Ten to twenty million will enter the nonagricultural workforce each year during the next two decades. That is, every year, China will add more nonagricultural workers than the total manufacturing workforce of the United States. In the next three to five years, China will add more workers to its urban workforce than the total manufacturing workforce of the United States, the European Union, and Japan combined.
Classical trade theory maintains that developing countries like China have a "natural" comparative advantage in labor-intensive, unskilled production owing to their large pool of impoverished workers in the countryside. Some cheerleaders of globalization postulate that the pitifully low wage earned by China's export workers-as little as 15 cents to 30 cents per hour-and the brutal treatment they receive are "legitimate," owing to the workers' lack of skill, their abundance, and their low level of productivity. In free labor markets, according to neoclassical economic theory, all workers earn (and deserve) their marginal productivity-that is, they earn what their output is worth.
But the assumptions underlying this simple theory crumble against the hard realities of China's political economy. China's inflation-adjusted manufacturing wages have fallen in the last decade, while labor productivity has rapidly increased from year to year-creating an enormous "wedge" between wage and productivity growth that flatly contradicts na?ve economic theory.
It may be true-under assumptions of full employment and perfectly competitive labor markets-that wages grow at the same rate as productivity. But in China, neither assumption holds. Hundreds of millions of destitute peasants are unemployed or underemployed.
Equally important, workers are not allocated to China's factories by a competitive market. China enforces internal passport controls that create an enormous, submerged caste of exploitable factory workers who are temporary migrants from the countryside. The Chinese system is not formally based on racial differences, but in practice migrant workers are distinguished by dialect and ethnicity; and the privileged class of permanent urban residents in fact treats migrant workers from the countryside as an ethnically inferior sub-caste.
Under the hukou ("household registration") system enforced by the much-feared Public Security Bureau (PSB), all Chinese citizens must live and work only in the place where they are permanently registered, generally the village, town, or city where their mother or father was registered. A Chinese citizen's place of permanent residence is therefore an inherited status. It is recorded in the "hukou bu," or registration booklet that all Chinese households must hold. The hukou bu also designates each household as either rural or urban. In practice, the inherited distinction between rural and urban residents produces a deeply entrenched caste system.
The permanent residence of the vast majority of Chinese citizens, of course, is in rural villages. Since the 1980s, peasants holding rural hukou have filled the need for labor in China's manufacturing sector, through a governmentally controlled system of labor allocation. If peasants obtain certifications from both sending and receiving provinces, they may migrate to manufacturing towns and cities-but only temporarily and only to fill designated jobs as laborers in factories, construction sites, domestic work for urban families, and assorted menial labor. They are prohibited by law and social prejudice from competing with people holding urban hukou for higher-paying jobs in technical, administrative, professional, or managerial jobs. Those holding urban hukou, in turn, generally do not seek employment in the low-paying, abusive, and dangerous factory jobs filled by desperately poor migrants from the countryside. Permanent urban residents view the new class of temporary migrant factory workers with extreme prejudice, hostility, and disdain.
The language of neoclassical economics is not entirely apposite in this context of government labor allocation. Nonetheless, for purposes of explication, we can say that factory workers' supply curve is artificially shifted downward-that is, workers offer their labor for lower wages-by at least four sets of government policies that sharply curtail their bargaining power.
First, China's manufacturing workers are not permitted to organize independent unions to defend their basic rights and raise their wages. They are not permitted to strike. The full force of state terror-beatings, imprisonment, psychiatric internment, and torture-is deployed against workers' attempts to exercise their right of association.
Second, the internal passport system denies migrant workers other basic civil and social rights in their temporary urban life, further suppressing their bargaining power and wages. Managers and local officials extract fees and deposits from newly arriving migrant workers and threaten them with even more severe penalties if they quit, enmeshing workers in a system of bonded labor. They are expelled and relocated to the countryside when they are no longer needed in the factory, when they are injured or sickened, or when they seek to assert their labor rights. Local officials in exporting areas compete for investment and, legally or corruptly, extract personal wealth from both state and private enterprises. Migrant workers therefore expect and get little legal protection or recourse from government officials.
Third, as already mentioned, migrant factory workers are denied access to better-paying skilled, technical, administrative, and managerial employment options in the permanent urban sector. They are frozen out of the better-paying urban labor market and overcrowded into the lower-paying rural and factory labor markets. If rural citizens were permitted to work in any urban job, not just in factories or construction sites, factory wages would rise-even if the relative wages of permanent urban citizens who now have privileged access to higher-paying jobs outside the factory system might fall.
Fourth, the "reservation wage" of migrant factory workers is set, in part, by the level of subsistence in the countryside. That is, in order to attract the rural unemployed to migrate into unskilled factory production, employers need only offer a wage that marginally exceeds rural subsistence levels plus transportation costs, not a wage that adequately compensates the workers' productivity. The degree of destitution in the Chinese countryside-and, therefore, the level of wages that must be offered by factories in order to lure migrant workers from the countryside-is anything but "natural" or "pre-political."
In both the pre- and post-reform eras, economic development strategies systematically transferred resources from those holding rural hukou to those holding urban hukou. A recent OECD study concluded that, in the mid-1990s, the Chinese government transferred more than $24 billion each year from the rural to the urban economy. Political scientists and economists have comprehensively mapped this fundamental fact of Chinese political economy. An urban hukou entitles one to public housing, health care, and pensions-all denied to holders of rural hukou. In the pre-reform era, "[t]he main enforcement mechanisms included the state control of agricultural production and procurement, the suppression of food-staple prices, and restrictions on rural-to-urban migration via a household registration system." In the post-reform era, the government continue to undertake "massive transfer[s]," by means of large-scale government investments in city infrastructure and social services to urban elites, paid for in part by an inflationary tax borne principally by the peasantry and in part by urban subsidies channeled through the state-owned banking system, in which rural residents must deposit their savings.
On top of these nationwide policies, local officials support themselves by imposing crushing taxes on rural citizens, driving peasants into factory work:
The economics are simple, residents said. People in Xiaoeshan eat most of what they grow, and by selling the rest they earn an average annual income of about $25 each. But local officials demand about $37 per person in taxes and fees. Several peasants who refused to pay last year were arrested.
Migrant factory workers "remain confined within . . . the state's persisting imperative: to ally urban growth and productivity with cost-saving, and, as a 'socialist' state, to provide for the city dweller while preserving the ruralite as docile, disposable trespasser, and drudge."
In light of these various mechanisms for artificially suppressing workers' bargaining power, it is not surprising that Chinese factory workers live under conditions that neutral researchers (and Chinese officials themselves) describe as "bestial," "horrific," and "abominable." They are often beaten and physically humiliated by supervisors and private security guards. They are paid far less than the legal minimum wage, which is itself set far below the minimum wages of countries at a comparable level of development. Their wages are often arbitrarily withheld or unpaid. Many work twelve- to eighteen-hour days, seven days a week, without a day of rest for months at a stretch. "Death by over-working"-or guolaosi-has become a commonly used term in contemporary China, and it is not used metaphorically. Most firms implement few health and safety measures, exposing workers to death not only by exhaustion but by toxins and machinery as well. China's rates of industrial death and lost limbs exceed any in history.
As a result, a startling number of workers take desperate, violent measures simply to draw attention to their plight-from blocking roads and railways to self-immolation. In contrast with other developing countries, most Chinese migrant workers wish to return to the countryside rather than settle in the city.
The Sub-caste of Migrant Factory Workers
The vast bulk of China's factory workers are temporary migrants holding rural hukou. The hukou system enmeshes factory workers in a system of bonded labor, a form of forced labor that violates Conventions 29 and 105 of the International Labor Organization and constitutes an unreasonable trade practice under section 301(d) of the Trade Act. Chinese citizens holding rural hukou who seek work in towns and cities without government permission are outlaws.
In 1958, the National People's Congress enacted Regulations on Household Registration in the People's Republic of China. These Regulations are still in force. Sections 15 and 16 require that migrants register with the PSB within three days of arrival to the city and re-register after three months. In 1994, the Ministry of Labor issued regulations requiring migrants to obtain from their home government a "registration card for leaving the area for work" and from the urban government a "work permit for personnel coming from outside." The registration card and the work permit together constitute a "migrant employment permit." Migrants may be recruited only into designated occupations in a receiving area.
The 1995 Measures on Application for and Issuance of Temporary Residence Permits require migrants to obtain temporary residence permits from the urban PSB. These measures therefore enable the PSB to maintain surveillance of migrant workers in their urban domiciles as well their workplaces. The PSB is required to record the migrant's temporary address and ensure that the migrant's landlord has permanent urban hukou. The measures further authorize local governments to impose fees for the residence permits, require migrants to obtain such permits as a precondition to obtaining work permits, and impose fines on migrants who fail to register with the PSB and on employers who hire unregistered migrants. Migrants are required to carry the residence permits at all times and show them to PSB officers upon request.
In order to change her job, a migrant must retrace these steps-that is, the migrant must again obtain a permit to leave her place of permanent registration and then obtain a temporary residence permit and temporary work permit from the receiving urban government.
In addition to the central government's regulations, each provincial, city, and local government has issued its own regulations concerning the fees and certificates that migrants must obtain in order to temporarily reside and work there. Local regulations on temporary residence and work are often complex, ambiguous, or simply unavailable to the public. They are widely impenetrable to migrants, especially the many who are illiterate.
Regardless of the clarity or transparency of the substantive regulations, they are administered arbitrarily and corruptly. Police extort payments from migrants or summarily expel them on the pretext that they fail to meet local regulations. Urban officials sporadically and violently "sweep" migrants out of cities and towns in large numbers-often in response to the demands of permanent residents, who view the migrants as a criminal underclass. For example, Beijing reported that it had taken 98,000 migrants into custody for lack of proper documentation and that 300,000 were "mobilized to leave the city" in 1997 alone. Since the late 1990s, greater unemployment among workers holding permanent urban hukou has led to greater antipathy to migrant workers by urban authorities.
Local governments-relying on a 1982 law of the State Council, which authorized local governments to designate jobless migrants as "vagrants and beggars"-have placed jobless migrants in detention and forceably "repatriated" them to their place of permanent residence. Local governments each year have held tens of thousands of migrant workers in "Custody and Repatriation Centers," on the ostensible ground that they cannot show temporary residence and work certificates required in that jurisdiction. Local authorities force detainees in these centers to work on public projects. Detainees are raped, beaten, and otherwise abused. Local officials require detainees to pay "ransoms" to gain release from custody. Once released, migrants are forceably repatriated to their place of permanent registration.
Migrants who fail to find jobs, who lose jobs, or who assert their labor rights remain subject to arrest, detention, fines, and (after processing in the aid stations) expulsion. Cities facing shortages of "drudge" labor may temporarily lighten registration fees and certification requirements or may reduce the level of police violence against migrants. Some local governments in China are currently experimenting with systems of temporary registration that do not impose de jure fees and that require migrants to carry and show their national identification cards rather than household registration booklets and other temporary permits. But, again, the hukou system, regulatory controls over temporary residence and temporary work, and the strong opportunities and incentives for abuse by police and employers remain in place throughout China.
Alliances between locally entrenched interests and the PSB strongly support the continuance of controls over migrants. As explained above, Party cadres have financial interests in the revenue produced by export enterprises, either as direct "partners" or as beneficiaries of exactions and extortion, and therefore have a strong interest in maintaining a cheap factory labor force. Local officials also benefit directly from the official or unofficial revenues produced by work and residence permits. These primary sources of local revenue have become even more vital since 2002, when the central government curtailed the financing of local governments by revenues from state-owned enterprises. And the powerful PSB sees the hukou controls as a necessary tool of social control.
Bonded Labor
Bonded labor is a form of forced or compulsory labor that is well recognized in international and domestic law. Bonded labor exists when a worker can exit or quit employment only after payment of severe monetary penalties, repayment of a debt, or loss of a "bond" posted by the worker upon initial hire. Because exit from the workplace is so costly, the worker is subject to highly abusive working conditions.
Academic and human-rights researchers have detailed the mechanisms through which China's hukou system produces bonded labor. Workers arriving from the countryside must pay substantial fees to local government officials and to employers in order to obtain residence and work permits required by the hukou system. Some of these payments are mandated by central and local law; some are "extra-legal" exactions by corrupt local officials and managers. As described above, the required fees and certificates vary widely from locality to locality, and are administered by local officials with almost complete discretion. Workers routinely go into debt in order to make these various up-front payments.
For example, a migrant to Shenzhen in 2001 needed the following documents, each of which required payment of a substantial fee: a border region pass, a personal identity card, an unmarried status certificate, a certificate to prove birth within China's one-child policy, a work permit, and a temporary residence permit.
On top of these, the migrant was required to pay a bond or "deposit" to the employer. These deposits are as much as four thousand yuan, exceeding one year's wages. Some local governments require enterprises to pay "new-hire" fees, but managers pass those fees on to new workers as well. These investments often exceed the migrant's life savings. To pay for them, migrants incur substantial debt, often payable to their own employer. As in classic bonded labor, a workers' up-front deposit will be lost and her debts will be in default, if the worker attempts to exit the employment relationship.
In addition to the deposit and the debt to cover the deposit, employers frequently withhold several months pay, which workers will also forgo if they quit or assert their rights. Some enterprises respond to a worker's threat to leave the job by imposing severe monetary penalties on co-workers-especially on the friends who initially referred the worker. Enterprise managers also seize workers' ID cards, residence permits, and work permits, making migrants more vulnerable still to arrest, fines, imprisonment, and repatriation if they leave the factory compound.
The deposits paid to employers, the wages withheld by managers, the new-hire fees passed on to workers, the withholding of ID certificates and residence permits, the threatened penalties against co-workers, and the debt accrued by workers to pay both government officials and managers together constitute an effective system of up-front bonds posted by migrant workers at the start of their employment. Chinese workers are acutely aware of the cumulative penalties they face if they quit or are fired for protesting.
New migrants' feverish effort to find jobs in order to avoid expulsion from urban areas, and their submission to employers' terms no matter how unfair, is a common sight in contemporary China.
Professor Anita Chan has identified yet another way in which the hukou system suppresses the labor standards of China's manufacturing workers:
[T]he Chinese hukou system and the pass system under apartheid in South Africa generated quite similar outcomes. They produced a large, vulnerable underclass living in constant insecurity, accompanied by daily discrimination, repression, hardship, and denial of their human dignity.
In light of these circumstances, it becomes possible to perceive how the Chinese hukou system can keep wages down more easily than in Mexico. . . .[I]n Mexico the workers who produce for export are, as in China, largely migrants from the countryside, and the majority similarly are female. But there is a major difference. Almost all of the Chinese female migrant workers are single women in their late teens or early twenties who, because of the household registration system, cannot bring their families with them. Many factories make sure that only single women are recruited by asking to see their officially issued identity certificates, which in keeping with the Chinese state's strict family-planning policy require that the marital and family planning status of each woman is listed. Since the workers are poor single women living in dormitories, management only needs to pay them enough for their individual survival.
In Mexico, the context is quite different. While most of the women workers in the maquiladoras are migrants from poorer regions, many of them have come with their families, since there is no pass system, and quite a number are single mothers. Very often these women workers are the sole breadwinners. Since they live with their families, a part of their waking hours has to be spent on "unproductive" chores (from management's vantage point): in commuting, in household tasks such as cooking, taking care of the old and the young. No matter how ruthless, there is a limit to the amount of overtime that management can squeeze out of these Mexican workers-fewer hours than with the young single women in dormitories in China.
The hukou system accounts in part for the fact that factory wages fell by 15 percent to 46 percent when temporary migrant workers-young, single, and bonded-replaced permanent urban residents in factory jobs. It also helps explain why migrants' wages fail to conform with the neoclassical economic assumption that wage growth tracks productivity growth-why, that is, their real wages have fallen in the last decade, while productivity has steadily risen.
Minimum Wages, Maximum Hours
In its 2003 Annual Report, the Congressional-Executive Commission on China concluded that China's factory workers "continue to work hours well in excess of legal limits, and for wages that are frequently not calculated according to law." China's failure to enforce minimum wage and maximum hours standards violates International Labor Organization Conventions and constitutes an unreasonable trade practice. According to Professor Chang Kai of the People's University School of Labor and Human Resources in Beijing, China "has ignored the protection of laborers' rights, especially migrant laborers' rights. We have no clear system that says who must bear responsibility when wages aren't paid, and how those responsible are to be punished."
The wages and hours of China's factory workers are effectively unprotected by legal regulation or by contract. Migrant workers are paid extremely low monthly sums-from 200 to 600 Rmb (approximately $24 to $72)-in return for working as many hours as employers can extract from them.
Nonpayment of wages is pervasive. According to a government survey, three out of four workers are unable to collect their pay as promised. An independent researcher found that "the illegal retention of workers' wages for between one and three months exists in 80 percent of foreign-financed firms" in Dongguan. A majority of workers must resort to begging or intimidating their employers simply to get paid. As a consequence, the wages actually collected by workers are well below the amount negotiated at the start of their employment. This results not from enterprises' financial difficulty but rather from employers' "deliberate malpractice," permitted by the negligible bargaining power of China's bonded workers. Factory workers fear that they will be discharged and lose their deposit "if they pursue their wages."
Hourly wages and unit labor costs are therefore greatly suppressed. Manufacturing wages for female workers range as low as 12 cents to 30 cents per hour. Male workers earn approximately 10 percent or 15 percent more.
The only real limits on wages and hours in China's factories are the physiological and psychological limits of the young women and men who work in that sector. Enterprises frequently push beyond those limits, and workers spontaneously protest by blocking roads or railways. Many threaten or commit suicide. Even these sad protests are met with government repression. Public Security forces in many cities have implemented policies of detaining any worker who threatens to commit suicide as a means of collecting wages.
It is true that the central Chinese government has formally promulgated guidelines for minimum wages and maximum hours. In practice, however, wage-and-hour rules are simply not enforced. To the contrary, local governments act as enforcers for enterprises' all-out suppression of labor costs. As detailed above, local officials and enterprise managers are allies in the unrestrained drive to export at lowest costs; and destitute migrants are in no position to demand that wage-and-hour standards be honored. Reebok's director of labor monitoring throughout Asia states,
Who enforces Chinese labor law? Nobody. If it were enforced, China would be a much better place for millions of people to work in. But it is ignored more than in any other country I work in.
Summary and Conclusions
This petition has shown that China's unremitting repression of workers' rights takes wages, health, and dignity not only from China's workers. It also displaces and impoverishes workers-and their families and communities-in the United States and throughout the world. All countries, including China and the United States, face strong incentives to compete for mobile capital and jobs by cheapening the labor and debasing the lives of their working citizens. These incentives are created by global rules that protect rights of property and contract but not rights of personhood and labor.
Nearly seventy years ago, the United States rejected rules like these, in our domestic multi-state system. Congress concluded that trade across borders "was the means of spreading and perpetuating . . . substandard labor conditions among the workers of the several states." In order to eliminate each state's incentive to perpetuate substandard labor conditions, it was necessary to enforce labor rights at the federal level. All states must be concurrently bound by labor rights, or each state would seek competitive advantage by suppressing those rights.
Fifteen years ago, in section 301(d), Congress elevated the same policy from the interstate to the international level. Congress authorized the USTR and the president to enforce workers' rights among our trading partners, for the sake of their workers and ours.
It is time for the USTR and the president to implement this policy. So long as China is not bound to honor workers' rights, China's rivals will resist complying with those rights. But so long as they resist, China too will complain of competitive disadvantage. Therefore, all countries should be concurrently bound by fundamental workers' rights, or each country will seek competitive advantage by suppressing those rights. For the same reason, all countries must be assured that those rights will be enforced evenhandedly from country to country.
These goals can be met if all countries are obligated, as a precondition to gaining the rights and benefits of membership in the WTO, to comply with the covenants of the International Labor Organization, the UN agency authorized to promulgate and supervise compliance with internationally recognized workers' rights. It is time that the United States used its extraordinary bargaining power to ensure that no country enjoys the rights and benefits of WTO membership unless it complies with ILO covenants. For this reason, the president should direct the USTR to enter into no new WTO-related trade agreement until such time as all WTO members are required to comply with the core covenants of the ILO. Fundamental workers' rights must be given the same protection that is now given to rights of commerce.
Nearly a century ago, Congress declared that "the labor of a human being is not a commodity or article of commerce." Perversely, global rules today give greater protection to articles of commerce than to the work of human beings. We can and must change these rules.
? 2003 Foundation for Study of Independent Ideas, Inc
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>> LEFT WATCH...TRYING TO FORGET REAGAN?

A Thought Experiment for the Left

by Mitchell Cohen
Here is a thought experiment for the left. It requires a bit of historical imagination, something for which the left is known. Its political implications are weighty. So weighty, I think, that the answer-your answer, Comrade Reader-to the question I pose at its end might well reveal if you can say to fellow citizens that you have the wherewithal to hold political power on their behalf (yes, I assume representative democracy, for all its flaws).
Imagine that you have become president of the United States in a particular set of circumstances. Let's call these circumstances the Historical Original Position, or HOP for short. HOP situates you in the Year of Our Relativity, 1981. As I construct it, you will perceive readily that HOP entails fantasy as well as events that occurred that year and before. In fact, the more you know about those pre-1981 events, the better. Later, when you step into the HOP, I will ask you to drop a veil over your memory for the sake of my argument. I will ask you to pretend that you are ignorant of all post-1981 history. Forgive me if I do not entirely do so. For the sake of our purposes here, I must integrate into my design some hints, just a few, about later decades.1 I think-hope-it will make sense since we are all reasonable historical creatures.
So here's the HOP. Due to an unexpected constellation of events, an insurgent movement called Democratic Equality wrests the Democratic presidential nomination from Jimmy Carter in 1980. You replace him. Let's give "you" a persona: you are Eugenia Norma Harrington, a distinguished civil rights attorney, long an eloquent advocate of social and economic fairness in America. You assemble a broad center-left political coalition against the Republican nominee, Ronald Reagan. Remarkably, you win the election and become the country's first woman-and first truly left-wing-president. The Democrats sweep both houses.
Reagan heads back west in a wagon train (he aims to live out his days encouraging Republican movie stars to act as if they are suitable for public office). Jimmy Carter seeks to be an effective ex-president, leading observers to suggest that he should have sought this job in the first place. Walter Mondale joins the new cabinet as secretary of the treasury. You have appointed him-the "centrist" on your team-to reinforce the coalition that enabled you to defeat Reagan. You ignore sniping that his appointment turns your administration into "a grotesque sellout to the priorities of the ruling class." (See Alexander Cockburn, "Stooges Yet Again: You can always tell an objective social democrat," in the Nation, November 32, 1980.)
In fact, you assemble a first-rate cabinet. Almost all its members read-and some even write for -Dissent. As might be expected, you place great emphasis on social and economic policy. "By the end of my presidency," you declared in the campaign, "markets will serve human needs, not vice versa. By the end of my presidency, we will have health insurance that is friendly to the sick, instead of to insurance companies. We will have an energy program that is friendly to the environment and not to the priorities of oil companies and Mideast potentates. By the end of my presidency, labor law will be reformed in order to bolster trade union organizing." (The AFL-CIO's leader protests this last point: "Why get distracted from anticommunism?"). You initiate a domestic agenda that combines investments in education and job training with affirmative action to address poverty and racism in the country.
Fortunately, those Iranian students freed the American hostages in Tehran on the day of your inauguration. That makes things a little easier as you order a general review of foreign policy. "Let's put real heat on South Africa and also on that SOB Pinochet," you say to your secretary of state. "And let's bolster the Solidarity movement in Poland. It's had a rough time, fighting the Communist Party's 'revolutionary consciousness' with 'trade union consciousness.'"
An Economic Security Council and More
Even though you are known for your domestic concerns, you have thought a lot about international affairs, especially the gap between the Northern and Southern Hemispheres. You ask the secretary of state to draw up plans for a new Economic Security Council (ESC) at the UN, an idea you've liked ever since you read Michael Harrington's The Vast Majority. The ESC will war against global poverty and illiteracy. One of its chief tasks will be to find ways to counter-balance the power of multinational corporations and financial institutions. "No global five year plans," you advise the secretary, "but real programs that will subordinate global markets to global social decency."
"Thatcher will howl."
"Then we'll be doing the right thing," you reply, "Why don't we see if we can get Willy Brandt's input? Speak to our friends in the Swedish Social Democratic Party. Most important, have some long conversations and then ongoing consultations with democratic socialists and trade unionists in Latin America, Africa, the Mideast, and Asia."
You and your secretary of state agree on the importance of designing the ESC so as to avoid past UN failures. The ESC must be structured so that it cannot be turned into an arena for cold war rivalries or a means to sustain third world dictators or promote the third worldist fantasies of intellectuals who sup with those dictators or serve as yet another forum for yet another resolution about "the Question of Palestine."
Why do some people think third world tyrants are liberators?, you wonder. Just because they spout left-wing words and denounce imperialism? Saddam Hussein, Iraq's ruling thug, who invaded Iran a few months back, gave a speech recently in which he declared, "Socialism does not mean the equal distribution of wealth between the deprived poor and the exploiting rich; this would be too inflexible. Socialism is a means to raise and improve productivity."2 Socialism? Sounds like National Socialism.
Over the years you have come to suspect that ideological "third worldism," which once moved you deeply-for all the right reasons, because you despise imperialism-is often quite bad for people living in the third world. It does seem to get people jobs, indeed even tenured jobs, but mostly in the first world. And you want the ESC to help the poor, to feed them, to empower them.
You are especially concerned about the long-term impact of American power in the world. Even though the country is still reeling from its disastrous war in Vietnam and seems weakened also by your predecessor's botched policies in Iran and Nicaragua, you know that only wishful thinking-sometimes Soviet, sometimes French, sometimes just na?ve leftist-will make America's global role dissipate. Actually, you think that Soviet power may decline. Some of your friends are amazed when you say this, but you reason that a gerontocracy can fashion the future for just so long. Moreover, you have been talking to people who study Russia through its complex history rather than by a mechanical application of the theory of totalitarianism. So you doubt if America's rival is shaped solely by-or frozen in-an idea.
Perhaps the United States should be prepared for big changes in Moscow a few years hence. You recently read an article in which a neoconservative academic, who was thought to have had a future in a Reagan administration, distinguished totalitarian regimes from authoritarian ones. The former are fixed forever because ideology remakes every nook and cranny and brain cell in them while that doesn't happen in the latter. (See Jeane J. Kirkpatrick, "Why Totalitarianism is Objectively Undemocratic but Authoritarianism is Subjectively Liberal," Commentary, Thermidor, 1979.) You wonder how this professor would explain post-Mao China. There is movement there-is it movement from totalitarianism to authoritarianism? Perhaps "totalitarianism" shouldn't provide a totalizing explanation of the country in the first place. Best not to mistake a design, however grand, for reality, and then divide the world according to who fits it.
Then there is the Mideast. It is also in the HOP. Nineteen seventy-nine created a dramatically new era there because of the Egypt-Israel treaty and the Iranian revolution. The impact of these events is not yet fully clear. Then there is civil war in Lebanon and, moving east, the Soviet invasion of Afghanistan. As it happens, you were looking through a file on the Arab-Israeli conflict that morning. "Well, at least something went right in the region, the Israel-Egypt peace. At least, we can give Carter some credit," you remark.
"That's true," responds the secretary of state, "but only some. Remember that he initially had a completely mistaken strategic concept for the region-one that many of our European friends applauded. He wanted an international conference under joint U.S.-Soviet auspices to push a 'Comprehensive Settlement' of all Arab-Israeli problems in one quick swoop.
"Sadat understood that this had to fail, and that is why he is the real strategic hero. He understood how that sort of conference would have rendered Egyptian flexibility hostage to Syria's extremist posturing, to its macho nationalism. It would have also been hostage to the ambitions of Syria's patron. Moscow wanted to reassert itself after its military advisers were thrown out of Egypt in '72 and it was sidelined by Kissinger's 'step by step' diplomacy following the '73 war. Sadat thought that if he could cut a deal with the Israelis, it might be a real step toward solving other issues and encourage other Israeli compromises.
"That's why he accepted the idea of Palestinian 'autonomy,' rather than demanding immediate Palestinian statehood," continues the secretary, "It was not just because he wanted a separate peace, like half the Arab world charged, but because it opened a way to a next step. It's worth noting that Rabin, who was Israeli prime minister when Carter came into office and who said back then that he didn't care if he had to visit the West Bank with a passport, also resisted Carter's international conference idea. Like Sadat, he thought that it would create negotiating conditions in which nobody could bend. The first thing Sadat's trip to Jerusalem did was to subvert Carter's approach. It was direct negotiations that finally produced something-an end to three decades of war between two countries. Carter's role at Camp David was then truly impressive, even heroic, yet only after he yielded to political reality."
"It is amazing," you observe to the secretary, "that an old fanatic like Menachem Begin agreed to a total Israeli pull-back from Sinai. Who would have believed that when he defeated the Labor Party in the 1977 elections? Still, the peace treaty would never have passed the Israeli Parliament without Labor's support-too much of Likud opposed it. And we are still left with the West Bank settlements and the Palestinian issue."
"True," says the secretary, "but the Israelis are pulling out of Sinai, and that is a valuable precedent. Even belligerent Ariel Sharon, champion of the Sinai settlements, called Begin during the negotiations at Camp David to say he'd yield them for a peace treaty.3 It will be interesting to see if Sharon actually takes charge of tearing them down. I've always sensed that this fellow is unusually brutal and mendacious, but that cuts two ways; he can also betray his own constituents, the folks who rallied to him for saying he'd make no concessions."
"Hard to tell," you say, "In the meantime, Begin is running for reelection and Sharon could be defense minister. What if we linked U.S. aid to both West Bank settlements and terrorism? For every Israeli settler who crosses the '67 borders, we deduct some aid money to Israel, and for every Palestinian terror bombing, we restore it. That would squeeze 'em both."
"Won't American Jewish leaders yell?"
"Perhaps, if they are not too busy having their pictures taken with Begin. In the meantime, we need to start worrying about the situation in Lebanon. It is unsettling, and one just never knows what sort of stunt Arafat could pull next. Whenever he is unhappy with developments, he throws everything into the air and hopes the Europeans will save him. What could be worse than a brawl in Lebanon with Arafat leading the Palestinians and Sharon as Israeli defense minister?"
"Arafat versus Sharon as prime minister."
"There's a nightmare for you. What do you think we should do about Arafat?," you wonder out loud. "He rejected Camp David, embraced Khomeini, presents no proposals except 'Give me what I demand.' Many of our European friends say, 'Give him a chance.' I wonder if they haven't made a myth of him. Did you ever read the interview of Arafat by Oriana Fallaci back in '72? She went in as a left-winger ready to be sympathetic to a third world hero. She left disillusioned. I have it over here. Arafat says to her, 'The end of Israel is the goal of our struggle and it allows for neither compromise nor mediation . . . revolutionary violence is the only system for liberating the land of our fathers . . . The purpose of this violence is to liquidate Zionism. . . .We don't want peace. We want war, victory. Peace for us means the destruction of Israel and nothing else.'"
"And read this," you add, "Arafat is supposed to be a Palestinian nationalist leader, but he insists here that 'From an Arab point of view, one doesn't speak of borders; Palestine is a small drop in the great Arabic ocean. And our nation is the Arab one; it is a nation extending from the Atlantic to the Red Sea and beyond.' He is being interviewed in Jordan and he insists they are in Palestine, that Jordan is Palestine. Doesn't Sharon say that? Arafat says that 'there is no difference between Palestinians and Egyptians. Both are part of the Arab nation.' So he agrees with Golda Meir that there are no Palestinians? Look at how he speaks about terrorism. Fallaci says to him that PLO bombings kill civilians, and Arafat replies, 'civilians or military, they're all equally guilty of wanting to destroy my people . . . civilians are the first accomplices of the gang that rules Israel.' Imagine, he says this just months before the massacre at the Munich Olympics. Fallaci asks him if he respects his foes, and he says 'As fighters, and even as strategists . . . sometimes yes. . . . But as persons no.' You must concede that Israelis are brave soldiers, says the interviewer. 'No! No! No!,' replies Arafat, 'No they're not! . . . They're too afraid of dying.' He declares, 'Losses to us don't count, we don't care if we die.'4 This guy will drive his people off a cliff while insisting he knows the one route to freedom. Shouldn't this guy have to take a driver's test before they give him diplomatic license? And then be given constant retesting?"
"Our European friends say he changed with his UN speech in '74," comments the secretary, "Nixon went to China. Sadat went to Jerusalem."
"But Voice of Palestine reported on July 7, 1979, that after meeting with Austrian chancellor Bruno Kreisky, 'Brother Abu Ammar [Arafat's nom de guerre-Eds.] reiterated the PLO's refusal to hold any dialogue with the leaders of the Zionist entity.' According to Tehran television on August 1, 1979, Arafat sent a telegram to Khomeini declaring, 'We will continue on the path of jihad and sacrifice until God almighty bestows final victory on us.' And PARS, Tehran's domestic news service, reported on August 6, 1979, that Arafat sent a telegram to Iran's foreign minister declaring, 'The nation of Palestine and the Arabs support the holy Islamic revolution in Iran and are determined to continue their fight and armed confrontation to recapture Palestine and free the Holy-land from the claws of the Zionists.' Our European friends seem to take Arafat at his word to them while ignoring the rest of his sentences.
"A lot of Israeli policy is bad," you continue. "Still, Israelis would be idiots to disregard this relentless rhetoric. On the other hand, the Israelis can defend themselves with their army and that doesn't require Jewish Khomeinis in West Bank settlements and Gaza. We need to distinguish support of Israel from backing deluded right-wing policies, just as we must distinguish Palestinian suffering from Arafat's appalling leadership. It seems to me that our Mideast policies should seek to consolidate the Israeli-Egyptian peace process, find ways to temper the Israeli-Palestinian struggle, and we must keep a sharp eye on Lebanon."
Complications
Then the secretary of state says, "There is another matter-the Persian Gulf and the Iran-Iraq War. Ever since Saddam attacked Khomeini's regime last September the area has suffered enormous carnage, massive misery, and high death tolls. Tehran has declared that it will fight back until there is a regime change in Baghdad. 'God wants us to share, together with the nation of Iraq, in the honor of toppling Saddam and his executioner regime,' declared Iran's prime minister, Ali Raja'i. 'The war against Iran is a war against Islam,' declared Ayatollah Khomeini himself. Khomeini, who was expelled in October 1978 from Najaf, Iraq, where he was a refugee from the shah [He then went to France.-Eds.], also denounced Saddam as a 'Zionist.' Why else would Saddam attack Iran? No, it is Khomeini who is really the 'Zionist,' Saddam riposted. Also, Syria's dictator, Hafez al-Assad, who backed Iran against Iraq, he, too, is a closet 'Zionist,' says Saddam. At least these two Supreme Leaders, Saddam and Khomeini, agree on something, the vast influence of Zionists.
"In fact, Saddam completely misread his enemy. He believed internal struggles had so weakened Khomeini's regime that it would simply fall apart as Iraq's army advanced. Saddam's illusion may have been encouraged by evaluations he received from Iranian exiles who fled to Baghdad after Khomeini's revolution. But the Iraqi invasion helped the new Iranian regime to consolidate instead. Saddam, already Iraq's strongman for some years, consolidated his own power in July 1979, a month after he officially became Iraqi president, by executing a third of the Baath Party's leadership.
"Saddam thought he could outsmart everyone," the secretary of state continues, as he hands you more papers, "and he outsmarted himself. Despite his initial battlefield success, he found himself in a military deadlock by late November 1980, not long after you defeated Reagan. Iran has now launched a massive counterattack. The situation is even trickier because the French have been helping Saddam to build a nuclear reactor. What is with that fellow Chirac? He seems to have been infatuated by Saddam, fantasizing that this dictator is a Napoleon-Nasser-de Gaulle. Because French Socialists gave the Israelis nuclear technology in the fifties, Chirac the right-winger wanted to correct this 'strategic error' in the 1970s by giving nuclear technology to Saddam.5 I heard that some wit renamed Iraq's Osirak nuclear site 'Ochirac.' "
"Fortunately, Chirac is no longer prime minister," you respond to the secretary, "now that our friend Mitterrand won the presidential election and there is a socialist government in Paris. I hope its grasp of the consequences of these sorts of policies is more astute. And let's make sure ours is astute too and pay special attention to developments in this region."
More Complications
So that provides part of the HOP into which you, Comrade Reader, will have to step when you make your decision as president of the United States. Imagine that these preceding conversations occurred in late May 1981, a few months after you moved into the White House. Let's now go forward to December of the same year. And please remember that the veil has dropped over you and you know nothing of what happens in the world after that month's end.
There have been Iranian offensives and victories. Saddam's army is in deep trouble. Soon his regime may be too. In late September, after a rout of the Iraqis, there were fevered, celebratory speeches in the Iranian parliament, the Majlis. Allah's hand has been revealed though Iran's triumphs. The Iranians dealt the Iraqis more blows by early December and severed crucial communications and logistical ties among Iraqi forces.6 In the meantime, the war has made it impossible for Iraq to use the Gulf for oil exports, and Baghdad is dangerously dependent on a pipeline through Syria-Iran's ally and Iraq's rival. Foreign exchange reserves have plummeted, and Baghdad will have to impose economic austerity soon.
According to intelligence reports, one of Iran's next campaigns will be called "Operation al-Quds," that is, "the Holy"-the Arabic word for Jerusalem. Khomeini is proclaiming that the march to Baghdad will lead eventually to Jerusalem. Even if this is just propaganda, it makes the Jordanians nervous, because their kingdom, which backs Iraq, is the most plausible path there. And Khomeini could well send holy warriors on a detour through Kuwait and Saudi Arabia.
It is very worrisome. You call up the national security adviser, and secretaries of state and defense and tell them you want to meet by the week's end to consider policy options. Then you riffle through a background file assembled by your national security adviser, who also provided a "General Assessment." It reads:
These two lands have a long, difficult history between them. The immediate source of conflict is a return to old quarrels, partly over the Shatt al-Arab, a waterway into the Gulf. It is the border between the two countries for some of its route. The Algiers Accord of 1975 supposedly settled this matter, but Saddam agreed to it under pressure because of the shah's support of Kurdish rebels. Once the agreement was signed and the shah withdrew support, the Kurdish struggle for national liberation collapsed. In the aftermath tens of thousands of Kurds were "transferred" by Saddam out of their homelands. Then Saddam got busy repressing Iraqi communists, throwing away the "National Action Charter" signed by the Baath with them in 1973. Hard to tell the greater danger: reaching an agreement with Saddam or not reaching an agreement with him.
The United States is on the outs with both Tehran and Baghdad. The Soviets have been Iraq's main arms supplier since 1958, but Baghdad sought to diversify its sources in the 1970s. It bought more and more from France, which became its second major weapons supplier-about 40 percent of Iraq's arms-by the time of the attack on Iran. In the 1970s France emerged as the third biggest exporter of arms to the Third World. Obviously, this is tied to sustaining huge investments in its domestic arms industry. All this is part of Paris's assertion of military independence after quitting NATO's joint command. France has been selling Iraq very advanced weapons and Mitterrand has made it clear that this will continue. Still, he, like everyone else must have been secretly relieved when Israel bombed Iraq's nuclear site last summer.
Baghdad's turn to Paris seems to have been prescient. Moscow is angry at Saddam for attacking Iran without the consultations Baghdad promised in the Iraqi-Soviet Friendship Treaty of 1972. The Soviets held back military supplies at the beginning of the war, but are preparing to deliver again. The Soviets and the French are attempting balancing acts between Iran and Iraq, seeking to extend sway in countries at war with each other. France's investment in Iraq grows by leaps and bounds, much to Iran's chagrin. Reliable sources report that Iraq is buying British medical kits-10,000 of them-that are apparently for workers in chemical weapons factories. Iraq is importing howitzers from South Africa, cluster bombs from Chile, and weapons from Argentina's junta.
The regional context makes matters more jittery. Islamic extremists assassinated Sadat just two months ago. The TV news shows the assassins and their collaborators behind bars screaming fundamentalist slogans. One of them, Ayman al-Zawahiri, the founder of Egyptian Islamic Jihad who studied at the American University of Cairo, seems especially fanatical, railing and ranting against infidels and traitors, Americans, and Zionists, hailing Sadat's murder. Wouldn't want him out of jail. Islamic fundamentalists seem to be on a roll- Sunnis as well as Shiites, for all the antagonisms between them. The momentum and self-confidence of each reinforces the other.
Sadat made a big mistake when he relaxed restraints on the Muslim Brothers and their ilk after Nasser died. He wanted them to counter-balance pro-Soviet factions in Egypt, but he did this just as the Saudis, flush with petrodollars, were investing in Wahhabi fundamentalism everywhere. Can you ever re-control decontrolled fundamentalists who believe the future is theirs? The United States is fiddling with jihadists too, thinking they may be useful against the Soviets in Afghanistan. Last year, Brzezinski gave a speech on the Afghan border to anti-Soviet Mujahideen in which he urged, "This is your God-given country. Go and liberate it in a Holy War against the godless Communists."7 Better think twice about this. There are also a number of reports of fundamentalist stirrings in Syria, especially in the town of Hama. If there is a regime able to handle the Muslim Brothers, it is Syria. It will simply dispatch them, no questions asked, and there will be no condemnatory resolutions passed by the UN or the Arab League. (They are usually too busy condemning Israel for something real or something imaginary.)
Then there is Lebanon, where a transformation is also underway. The Shiites, who make up some 40 percent of the population, its most deprived sector, have mobilized. They are clashing constantly with the PLO mini-state that was established in southern Lebanon after Arafat was expelled from Jordan. The Lebanese confessional system was stacked against the Shiites, but now, in the midst of civil war, they are demanding their due as never before thanks partly to the leadership of a charismatic religious leader, Iranian born Musa al-Sadr. He died under bizarre circumstances after a trip to Libya in 1978. (Qadaffi claims al-Sadr boarded a return flight, but he wasn't on it when the plane arrived in Lebanon; nobody ever found him.) So he became a galvanizing myth, and then just after his disappearance, the Iranian revolution energized Lebanese Shiites even more.
In short, the Mideast presents its usual tumultuous picture, you think. Lebanon is fractured, but everywhere else there seem to be authoritarian nationalist regimes on one hand and civil societies in which religious fundamentalists are emerging as the most vigorous component on the other. And things are becoming more and more precarious because of the Iran-Iraq War. A miserable regime may defeat a wretched one. Now you, as president, must make a choice. You meet your national security adviser and your secretaries of state and defense in the Oval Office.
What to Do?
The national security adviser begins: "The United States has pursued some ill-conceived policies and has had some bad luck in this area. There are a few key issues, all linked: What are the consequences if we do nothing? What influence do we have? Can we achieve anything positive? Do we have some overriding interest in sticking our nose in just now? We already have a recession at home that has been helped along significantly by the oil crisis following Khomeini's rise. But the immediate, very big question is this: If Khomeini, who is devoted to spreading his Islamic revolution, marches to Baghdad and a swell of triumphalist fanaticism rises mightily throughout the region, what then?"
"What is our latest evaluation of Khomeini?," you ask. "And what of left opinion? After all, the hostages were released after we won the election. As I recall, some prominent American intellectuals, not just Foucault in France, thought highly of him."
"That's right," says the national security adviser, "did you read in the file I prepared that New York Times op-ed piece from February 1979 by Richard Falk, the professor of international law at Princeton? He visited Khomeini in France. His article complained that the ayatollah was maligned when Carter and Brzezinski 'until recently associated him with religious fanaticism.' Falk protests that 'The news media have defamed him in many ways, associating him with efforts to turn the clock back 1,300 years, with virulent anti-Semitism, and with a new political disorder, "theocratic fascism" about to be set loose on the world.' He explains to readers that Khomeini 'indicated' that non-religious leftists would be able to participate fully in an Islamic republic and that 'to suppose that Ayatollah Khomeini is dissembling seems almost beyond belief.' He adds that 'the depiction of him as fanatical, reactionary, and the bearer of crude prejudices seems certainly and happily false.'8
"The article is entitled 'Trusting Khomeini,'" you note. "I hope he doesn't write on 'Trusting Arafat' to convince Israelis to make concessions to the Palestinians. People will run into Sharon's arms after reading it."
"There's more," says the national security adviser. "Anthony Lewis then wrote a Times column chastising Falk for 'trusting in illusions'-things were getting increasingly repressive in Khomeini's Iran-and Falk insists that 'to single out Iran for criticism at this point is to lend support to that fashionable falsehood, embraced by Mr. Lewis, that what has happened in Iran is the replacement of one tyranny by another.'"9
"Well, I don't think we'll consult him," you comment. "For starters, I don't intend to wear a veil myself. The reasoning reminds me a little too much of intellectuals who 'understood' Stalin-in contrast to the bourgeois idiots. We need a left foreign policy that is free, really free, of cognitive dissonance." You turn to the secretary of defense and ask him to assess the impact of the Iranian revolution on the Iraqi military.
"It's hard to say," the secretary, responds. "Intelligence here is always difficult. Sixty percent of Iraq is Shiite. While they are not all of a stripe, and while they tend to be Iraqi nationalists-Iraq's ground troops in the war are heavily Shiite-they are also not so pleased by Saddam, whose Baath power base is mainly Sunni and tribal. Still, imagine Shiite fundamentalist regimes in Tehran and Baghdad concurrent with a fascist regime in Damascus, energized Shiism in Lebanon, and invigorated Sunni fundamentalism in an uncertain, post-Sadat Egypt.
"No intelligent person, no matter how anti-imperialist, however much he despises Western oil companies, can imagine that it would be good for religious fanatics and their allies to control this region of the world, not to mention the West's oil supply-just as no intelligent person could be happy about Saddam marching into Tehran, with his fascist regime asserting control over oil and the Gulf on behalf of a pan-Arab chauvinism. Even if one argued-it is a legitimate claim-that we are imperious outsiders, especially given our past support for the shah, that brutal megalomaniac, the consequences would be dreadful. But right now, it looks more likely that Khomeini could win."
"Problem is," says the secretary of state, "our influence is at a nadir. U.S. policy in the seventies was based on 'two pillars,' both of them conservative, dominating the Gulf-Tehran and Riyadh. Now those reactionary Saudis are petrified and Tehran is utterly hostile to us. Relations between the United States and Iraq were broken in 1967, in the aftermath of the Arab-Israeli war. We began some trade again in the mid-1970s, and it increased in late '79. We have some presence in Baghdad through our interests section in the Belgian embassy. We are getting conciliatory signals from Saddam. He is running scared, very scared. And we have received a quiet message from Mitterrand: 'Saddam must not fall.' He isn't saying that merely because of French investments in Iraq. He sees the dire consequences, long and short term, of a Khomeini sweep. So the crucial question is, should we tilt to Iraq? Or rather, what if we don't?"
The national security adviser asks, "What are the alternatives? A UN resolution? A UN-coordinated oil embargo against both sides? It'll never work. Moscow and Paris are too invested. Besides, there isn't much reason to have faith in the UN when it comes to this part of the world. Look at what it did during the crisis before the '67 Arab-Israeli War. Nasser mobilized his army, demanded removal of UN Emergency Forces that served as the buffer between Egypt and Israel for a decade, and next thing you know, the UNEF is on the way out. UN Secretary General U Thant stuck to international legalisms and the result was war. Anyway, nobody who has paid attention to Khomeini or Saddam can believe that either will knuckle under an embargo, not to mention the demands of international law or the UN. We need a policy that won't help the UN shoot its own foot.
"Still, we'd better deliberate hard about a 'tilt' to someone like Saddam. If we help him too much, he'll become the danger, almost certainly. And we don't want to give him the wrong help. Think of his pursuit of nuclear power and those British medical kits he imported. One easily imagines him deploying the worst weapons against his neighbors and his own population. He is atrocity incarnate. Remember, he launched this war."
"Moreover," you interject, "ours is supposed to be a foreign policy of the left. That is a matter of our values, but also of politics. If we botch this, if we show the American people that the left cannot conduct foreign policy, then we can expect Reagan's wagon train to turn around.
"Can a foreign policy of the left tilt to a regime like Saddam's? Hard to justify, even if it only means that we will give him satellite intelligence and carefully gauged arms assistance. I must say that the very need to make this decision irks me. Were we out of government, we would probably be writing articles for Dissent saying that the problem is the overall direction of American foreign policy. Except we won the election, and we already reoriented policy with the long term in mind.
"We cannot make decisions in government as if we were out of government. We cannot invent choices that are comfortable to us and then choose between them. How can we find some practical equilibrium between our left-wing values and the intransigent realities of the world out there-like the consequence of the aggressive ambitions of either a fascist dictator or a 'fanatical, reactionary, and the bearer of crude prejudices,' to quote Falk. Regardless of what we do, neither Saddam nor Khomeini is likely to function in ways that are wholly rational and predictable. Can we minimize the maximum damage each might do? If we do nothing, if we don't 'tilt' to Saddam, the regional and then global consequences are likely to be catastrophic. Military intelligence makes it clear that the hour is very late. If we do tilt to him, our hands become very dirty, and a lot of the consequences are unpredictable."
You light a cigarette. You quit smoking years back, but you've been cheating in recent days as you contemplate the decision you might have to make. You inhale deeply and say, "Here is what I think we must do. . ."
And here is where I will ask you, Dissent reader, to recall that you are supposed to imagine yourself to be Eugenia Norma Harrington, the fortieth president of the United States, in this Historical Original Position. The veil you wear is not one of Khomeini's choosing, but a historical one: you don't know any post-1981 history. You may ask what I would do were I the president. I do have a view about this-one that I don't like. But because I am the architect of this thought experiment, I won't say. I will step back (I hear that I am not the first grand designer to do this), and ask you, Madame President: will you tilt to Iraq?

Mitchell Cohen is co-editor of Dissent.

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L'?ditorial du Monde
Hors de Guantanamo
LE MONDE | 27.07.04 | 12h23
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QUATRE des sept Fran?ais d?tenus sur la base am?ricaine de Guantanamo, ? Cuba, ont, enfin, quitt? cette zone de non-droit pour rentrer ? Paris. Cela faisait des mois que le gouvernement fran?ais n?gociait leur retour, afin que leur situation soit examin?e dans un cadre juridique normal.
La France n'?tant pas en odeur de saintet? ? Washington, la lib?ration de ses ressortissants n'avait pas ?t? jug?e prioritaire ; elle suit celle de 135 d?tenus d?j? remis ? leurs pays.
Pendant que diplomates et organisations de d?fense des droits de l'homme vont continuer ? s'activer pour obtenir le transfert des autres d?tenus, le sort des quatre hommes attendus mardi 27 juillet va - enfin - d?pendre de la justice. Une justice antiterroriste certes, mais ob?issant aux r?gles du droit et fondant ses d?cisions sur des preuves tangibles. Il lui reviendra de d?cider, dans les r?gles, s'il existe des charges contre eux, ou bien s'il convient de les lib?rer, comme cela a d?j? ?t? le cas ? Londres ou au Danemark.
S'ils sont blanchis, ce sera un nouveau coup dur pour la cr?dibilit? de la "guerre contre le terrorisme" conduite par le pr?sident Bush, au m?pris du droit - national ou international - ni de la morale. Du non-droit ? Guantanamo aux prisons de Bagdad, l'exemple donn? par les Etats-Unis n'est pas ? l'honneur de la plus grande d?mocratie du monde et l'image de ce pays en a s?rieusement p?ti ? travers le monde.
Au m?me moment, ? la suite du d?saveu historique inflig? le 28 juin ? l'administration Bush par la Cour supr?me, qui a donn? le droit aux "combattants ennemis" d?tenus ? Guantanamo de se pourvoir devant la justice civile am?ricaine, le Pentagone a mis en place une instance militaire devant laquelle les d?tenus vont pouvoir contester leur statut. Il aura fallu ? certains d'entre eux jusqu'? deux ans et demi avant de pouvoir ainsi se d?fendre.
Nul ne nie qu'il y a sans doute, parmi les quelque 600 d?tenus de Guantanamo, de vrais terroristes li?s ? Al-Qaida. Mais ces soup?ons ne justifient pas pour autant le traitement juridique et physique qui leur a ?t? r?serv? depuis leur arrestation.
L'histoire montre que les Etats qui ont choisi de lutter contre le terrorisme ou l'oppression par des moyens non-d?mocratiques n'ont jamais r?ussi. Ces m?thodes n'aboutissent g?n?ralement qu'? jeter le discr?dit sur ceux qui s'y livrent - et sur ceux qui les y autorisent. La sup?riorit? de la d?mocratie tient dans son refus de se livrer ? des actions d?gradantes et ill?gales. M?me si, dans des circonstances exceptionnelles, comme le 11 Septembre, elle peut - et doit - se doter de moyens exceptionnels pour se d?fendre. Mais toujours sous le contr?le de la justice.
Alors que s'ouvre, avec la convention d?mocrate, la phase finale de la campagne pr?sidentielle, il faut esp?rer que, sans baisser la garde, les Etats-Unis reviennent ? la l?galit?. Et que le respect du droit, un temps oubli? ? Washington pour des raisons discutables, redevienne le fondement de la d?mocratie am?ricaine.
* ARTICLE PARU DANS L'EDITION DU 28.07.04
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WORLDWIDE ADDICTION TO PETROLEUM
Is there really a rise in oil prices?

Which energy source will we use in future? Despite forecasts of a change to nuclear power, oil will continue to play a key role. According to the International Energy Agency demand will increase by 1.9% a year, from 80m barrels a day in 2003 to 120m in 2020. By then Arab countries will produce 41% of global supplies rather than the present 25%.
by Nicolas Sarkis

WHAT is behind the current steep rise in oil prices? Is it temporary and linked to the economic and political climate, or the start of a cycle that will bring a long-term increase in energy prices? Is it, as some fear, the prologue to another oil crisis caused by the inability of supply to keep pace with demand?
These questions are legitimate. Some observers thought that the invasion of Iraq by the United States in March 2003 would lead to a quick rise in Iraqi output and a drop in oil prices to about $20 a barrel. But two months later the oil market came to the boil and has been bubbling ever since. This spring the unexpected rise in prices speeded up despite a seasonal drop in world demand of about 2m barrels a day.
The drop in prices after the last meeting of Opec (1) on 3 June and the announcement of an increase in US reserves did not dispel concern. World demand is expected to rise again in the immediate future and the underlying factors that boosted prices to more than $40 a barrel have not gone away. The key factors are the global political situation and market forces.
The price hike would not have been as sudden if conditions in Iraq were different and Saudi Arabia not vulnerable to terror attacks. Widespread insecurity and recurrent sabotage of oil facilities in Iraq dragged production there down to 1.33m barrels a day (bpd) in 2003, compared with 2.12m in 2002. Production rose to 2.3 bpd in May 2004, but that is still well below the levels in 1999-2001.The new authorities have frozen contracts negotiated or signed by the Ba'athist regime with international companies to exploit new oilfields, which were expected to double output within six to eight years. Recent terror attacks in Saudi Arabia, which is the world's largest exporter, especially an attack that targeted a petrochemical facility and wells, were a serious shock.
The current frequency of attacks makes people fear that they will be a recurring feature in Saudi Arabia, Iraq and other Gulf states, with the possibility of lasting disruption of exports. The big difference from the crises of 1973 or 1979 is that the basic problem then was an embargo instituted by the governments of Opec countries or a change in political regime (as in Iran after the Islamic revolution). Now unpredictable attacks by unknown groups are the problem, plus the threat of the destabilisation of the Saudi regime that undermines that country's ability to continue its central role in supplying world demand.
Tensions caused by the deterioration of the situation in Iraq and Saudi Arabia are mostly responsible for the latest price rise, called the risk premium. This runs at $6-10 a barrel, depending on circumstances, and covers both higher insurance charges and the impact of speculation on futures markets (major investment banks have allocated tens of billions of dollars to these).
Geopolitical tension and speculative buying have amplified a bullish trend rooted in a change in the balance between supply and demand. Three main factors demand our attention. The first, often overlooked, is the impact of ethnic conflicts and strikes on Nigerian oil production. (The strike that paralysed the oil industry in Venezuela in 2003 also led to a substantial drop in output.)
The second problem is that refining bottlenecks are common in countries with the largest consumption. After inadequate investment in recent years, global capacity currently totals 83.6m bpd, slightly more than the 82.5m bpd peak in demand in February. The structure of refining capacity is unsuited to the current demand for refined products, particularly in the US, which uses 9.6m barrels daily; a petrol shortage in May caused prices to rise steeply. When the price of refined products rose, crude oil prices followed.
The third problem is that on 10 April Opec decided to reduce its production ceiling to 23.5m bpd; this led to a sharp protest in industrialised countries, adding to tension and exacerbating the rise in prices. In practice Opec members have not reduced real output, and overall supply is still sufficient to cover demand.
Oil market statistics are fuzzy. Surprisingly, Opec members publish production figures three months late, maintaining the confusion between their theoretical production quotas and actual output, which generally exceeds quotas. Operators and observers play hide-and-seek, attempting to track tankers as they leave loading ports and consulting secondary sources to assess, as far as possible, the daily production of oil. A lack of transparency does not only apply to real output figures but affects data on production capacity and variations in unused capacity in exporting countries. This is very important at times of low unused capacity, as at present.
The most reliable estimates are that unused capacity is now about 2.5-3m bpd worldwide. Most of this is in Saudi Arabia; production is at full capacity in non-Opec and most member countries. A major disruption in Saudi or Iraqi exports, or a strike or serious accident in another main exporting country, could cause a shortfall in supply, driving market prices up again. This risk contributed to the latest price hike; the expected increase in world demand in the second half of 2004 will stretch the meagre resources available.
Another void in oil statistics centres on the doubts about official data on proven reserves and the reliability of medium- and long-term forecasts of global supply and demand. When an international company such as Shell, with shares quoted on stock exchanges, cuts its reserves forecast by about 25% in a few months, it is hardly surprising that figures published by other large corporations should be queried.
Official statistics on proven reserves in Russia and the main Opec members, which are not checked by independent bodies, have prompted serious doubts for many years. There is a major problem here. The reserves of the eight largest national companies in Opec countries theoretically amount to 662bn barrels, compared with only 57bn barrels held by the top eight international companies. The recent controversy after the Simmons report (2) on the state of the Saudi oil fields and the scope for developing the reserves of Saudi Aramco (the national oil company), which amount to almost a quarter of the world total, exacerbated concern.
World demand, currently at 80.3m bpd, is expected to rise to almost 120m bpd by 2025, roughly twice the level of the 1970s. Can supply follow? Only the Middle East can provide the bulk of it, which means output must more than double to avoid shortages. In the medium term obstacles to this are mostly political. To increase output will require huge investments in the region, estimated at $27bn a year. But for that to be possible there must be a favourable political climate, which is far from the case. Beyond that lies the big unknown, in the Middle East and elsewhere: when production will peak, in one country after another, before irreversible decline.
The Association for the Study of Peak Oil international conference in Berlin in May 2003 was not reassuring. Disregarding claims of both optimists and pessimists, the number of new finds is falling, as is their volume. Only one giant oil field, Kashagan in Kazakhstan, has been discovered in the past 30 years and new finds do not compensate for the oil extracted every year. A geologist says that oil exploration is now like a hunting expedition on which hunters have improved the perform ance of their guns through better technology but game is small and scarce.
We should not ignore another grim reality: by 2025 the steep increase in world demand and decline in reserves and output in industrialised countries will increase their dependence on imported oil. US imports will rise from 55.7% to 71%, western European imports from 50.1% to 68.6%, and Chinese from 31.5% to 73.2%. This growing dependence, in a sector as vital as energy, explains the oil wars that the big powers and their com panies are waging to gain control of reserves in the Middle East, Africa (3), Central Asia and Iraq (4). There has been serious reason to question the interpretation of the current rises - are they the first sign of a crisis caused by the imbalance between steadily rising demand and inadequate production capacity?
The expansion of production capacity over the next few years depends just as much on political stability, particularly in the Middle East, as on the volume of reserves available. Longer term the slow but inexorable exhaustion of reserves means that a gradual switch to other energy sources is inevitable. Besides political stability this transition requires sufficiently attractive energy prices to allow global investment in energy production, a sum estimated by the International Energy Agency at $16,480bn (at 2000 prices) between 2001 and 2003.
Oil and gas industries will need money, and more will be needed to develop other energy sources. The fears caused by the rise in oil prices may help end the torpor made possible by adequate supplies and oil prices which, even at their current level (adjusted for inflation), are no higher than the record set 25 years ago.
* Nicolas Sarkis is director of the Arab Petroleum Research Centre and editor of 'Le p?trole et le gaz arabes'
(1) Opec's 11 members are Saudi Arabia, Iraq, Iran, Kuwait, Qatar, United Arab Emirates, Algeria, Libya, Nigeria, Venezuela and Indonesia.
(2) Matthew Simmons, president of the Simmons & Company international investment bank, advises the US vice-president Dick Cheney and was the brains behind the new US energy policy.
(3) See Jean-Christophe Servant, "The new Gulf oil states", Le Monde diplomatique, English language edition, January 2003.
(4) See Yahya Sadowski, "No war for whose oil", Le Monde diplomatique, English language edition, April 2003.
Translated by Harry Forster
ALL RIGHTS RESERVED ? 1997-2004 Le Monde diplomatique
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>> RICIN...

Ricin found in baby-food jar
Associated Press
POSTED AT 5:05 PM EDT Wednesday, Jul 28, 2004
Irvine, Calif. -- Trace amounts of the deadly poison ricin have been found in at least one jar of baby food that had been tampered with, the FBI said Wednesday.
The FBI and prosecutors are investigating two suspected cases of food tampering. No injuries or arrests have been reported, FBI spokeswoman Laura Eimiller said.
Authorities have not disclosed the amount of ricin discovered, the number of baby food jars that contained the poison or a possible motive.
On June 16, a man told Irvine police that as he was about to feed his son, he found a note inside a jar of baby food warning that it had been contaminated. A similar case was reported by an Irvine couple on May 31 involving the same baby food, Gerber Banana Yogurt, police said. A note was also found inside that jar. Investigators were testing Gerber Banana Yogurt removed from the store where both jars were purchased. They did not specify whether the ricin was found in both jars. Authorities did not disclose the contents of the notes but said they referred to an Irvine police officer. Ricin is made from castor beans and can be fatal if swallowed, inhaled or injected. A dose about the size of the head of a pin could be enough to kill an adult, according to the Centers for Disease Control and Prevention.


>> NEXT DAY...


Ricin in baby food appears isolated
By Ben Fox, Associated Press | July 29, 2004

IRVINE, Calif. -- Police said yesterday they are looking for a man who may have witnessed the tampering of two jars of baby food that were contaminated with ground castor beans containing tiny amounts of the poison ricin.
The contamination of the jars also included notes that referred to an Irvine police officer.
US Food and Drug Administration officials who tested the baby food said the ricin was not in the purified form that can be deadly. Rather, it was a less toxic, natural component of the castor beans, which can be obtained from ornamental plants.
''It's unlikely there would be serious injury with the level of castor bean found in those two jars we tested," said Dr. David Acheson, chief medical officer with the FDA's Center for Food, Safety and Applied Nutrition.
Small amounts of the food were eaten, but the babies had no symptoms, he said.
Authorities have not disclosed a motive but want to question Charles Dewey Cage, 47, of Irvine, a possible witness who was ''in the area at a relevant time," said Orange County District Attorney Tony Rackauckas.
Authorities called it an isolated case and said no more contamination was found at the store where the two jars were bought.
''There's no reason to believe there is any more out there," said Dan Henson, a special agent with the FDA.
The jars of Gerber Banana Yogurt also contained notes that referred to an Irvine police officer whose name was not released, but their exact contents were not disclosed. The officer is not a suspect, authorities said.
On June 16, a man told Irvine police that as he prepared to feed his son, he found a note inside a jar of baby food warning that it had been contaminated. A similar case was reported by an Irvine couple on May 31 involving the same baby food, police said. A note was also found inside that jar.
The Gerber Products Co., based in Parsippany, N.J., is working with investigators. Authorities told the company the contamination ''absolutely" occurred after the food was manufactured, said Gerber spokeswoman Terry Boylan. Gerber baby food jars are vacuum sealed and should pop when opened. If they don't, it could indicate they have been tampered with, Boylan said.
Ricin can be fatal if swallowed, inhaled, or injected. A dose about the size of the head of a pin could be enough to kill an adult, according to the Centers for Disease Control and Prevention.

? Copyright 2004 Globe Newspaper Company.

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