The United States has already begun working on behalf of its new Iraqi client state in the IMF and World Bank:

Finance ministers and development activists gathered here Friday for meetings to discuss the world economy, poverty and reform of the world's financial institutions were stunned when a U.S. official suggested that global creditors should forgive Iraqi debts.

U.S. Treasury Secretary John Snow, whose government often sets the tempo for meetings such as this weekend's gathering of the International Monetary Fund (IMF) and World Bank, took the place by storm when he said Iraq's whopping debt - estimated at between 100 and 300 billion dollars - must be cancelled. Snow said he expected to have substantive conversations during the two-day meeting with ministers from the G7 most industrialised nations on "how our nations and international institutions can work together to help the Iraqi people recover, not just from 25 days of conflict, but from 25 years of economic misrule".

Activists said they were elated that a U.S. official had recognised that debts left from corrupt and repressive governments are intractable obstacles to re-developing a country like Iraq, and that officials should apply the same logic to other nations suffering under worse conditions than Iraq. But some doubted that would happen. "It's clearly self-serving," said Soren Ambrose from the 50 Years is Enough network. The U.S. government has steadfastly opposed cancelling debts in the rest of the world, he added, "even in cases as egregious as the apartheid government's debts in South Africa and Mobutu's debts in Zaire (known now as Congo)". Ambrose said it would be a highly political matter if the choice were made to save the Iraqis alone. "It's an absolute travesty," he said. ...

Snow said that the Bank, IMF and other global institutions should be prepared to offer their "expertise and technical assistance as soon as possible" to Iraq.

The semi-annual gathering of the Bank and IMF were already under pressure from U.S. officials to push Iraq onto the agenda at the expense of development issues, a proposed debt restructuring mechanism, poverty and governance of the two organisations often targeted by civil society groups. The Iraq issue was further complicated when Deputy U.S. Defence Secretary Paul Wolfowitz told Congress on Friday that France, Germany and Russia, countries that opposed the U.S.-led invasion of Iraq, could only assist in rebuilding the country if they forgave billons of dollars of debt owed to them.

"I hope, for example, they'll think about the very large debts that come from money that was lent to Saddam Hussein to buy weapons and to build palaces and to build instruments of repression," he told the Senate's armed services committee. That is the height of hypocrisy, Ambrose said. "Going in this nearly unilateral fashion and conquering a country half-way around the world, devastating its infrastructure even more than it already was, is in a sense saying that 'we are now responsible for Iraq and countries are expecting us to finance its development, so now we are going to make the same demand that others have been making of us'."

Among the main reasons why scores of activists will take to the streets here this weekend to protest the policies of the U.S. government, the Bank and IMF is that in much of Africa and other developing countries people are held hostage by suffocating debt burdens - spending far more on repayments than on health care and education. Uganda's Finance Minister Gerald Ssendaula said Friday some African countries have to pay some 80 dollars towards debt on each 100 dollars generated locally.

Inter Press Service, "Activists Stunned by U.S. Debt Forgiveness Plan" by Emad Mekay, April 12, 2003

So once again, the U.S. government rejects its own principles and seeks debt cancellation. Not only that, it has made participation by other nations in Iraq contingent on their forgiving Iraq's debt. A high price that I'm sure the U.S. does not wish to be paid. It will instead prefer to unilaterally cancel them to get the best of both worlds: sole ideological control over an Iraqi puppet government free of debt. Notice, too, that U.S. Treasury Secretary Tony Snow subscribes to the same theory as the Heritage Foundation "experts." Namely, that "economic misrule" was Iraq's problem all along.

One of the motivations of the war is privatization of Iraq's oil (nationalized by Hussein in 1972). So let's talk about the Heritage Foundation. "The Heritage Foundation is a research and educational institute - a think tank - whose mission is to formulate and promote conservative public policies based on the principles of free enterprise, limited government, individual freedom, traditional American values, and a strong national defense." The Heritage Foundation, as a right-wing, conservative "think tank" is closely linked to the Bush Administration and has put together a little ensemble it calls "The Future of a Post-Saddam Iraq: A Blueprint for American Involvement" consisting of a set of policy essays written by Heritage Foundation "experts."

The stand-out is a piece written by Ariel Cohen and Gerald O’Driscoll, Jr. entitled "The Road to Economic Prosperity for a Post-Saddam Iraq." Before we get to the specific recommendations for "American involvement" in post-Saddam Iraq, however, I must comment on the depth of the analysis as a test of just how much "expert" and how much propaganda has gone into the analysis. The executive summary begins:

Saddam’s regime has succeeded in bankrupting the country even though Iraq boasts the world’s second largest oil reserves after Saudi Arabia, estimated at 112 billion barrels of oil and potentially even higher. The oil sector provides more than 60 percent of the country’s gross domestic product (GDP) and 95 percent of its hard currency earnings. Yet GDP for 2001, at the market exchange rate, is estimated to be only about one-third its level in 1989. Iraq also is hobbled by its $140 billion foreign debt. This devastation was wrought by such policies as the nationalization of the country’s chief export commodity, oil; extensive central planning of industry and trade; the 1982–1988 war against Iran; and the invasion of Kuwait, which precipitated the 1991 Gulf War.

That's it. Iraq's GDP in 2001 is one-third its level of 1989 because Iraq nationalized its oil in 1972, because of Iraq's invasion of Iran that occurred with U.S. support between 1982 and 1988, and because of Iraq's invasion of Kuwait in 1991 which occurred potentially with the accession of the United States government. It apparently had nothing to do with economic sanctions imposed by the United Nations and the United States which were directly targeted against the Iraqi economy and the Iraqi people. Yet the authors later recognize that the end of Hussein means the end of economic sanctions without a trace of irony. It apparently cannot be deduced that the purpose of the sanctions was to guarantee the success of Hussein's replacement regime. So much for the experts.

But moving on to the heart of the article:

Privatization efforts in other countries show that privately held infrastructure, oil, and oil service companies generate greater efficiencies, improved production, and higher revenues than do centrally planned and state-owned industries. The same can be achieved in Iraq, whose oil industry cannot thrive without access to global capital markets. The Administration should work with Iraq's future federal government to develop mechanisms for privatizing these industries, taxing oil sales, and sharing the proceeds equitably with the three major ethnic regions--the Shiite Arabs in the South, the Kurds in the North, and the Sunni Arabs in the central region.

Furthermore:

During the 1990s, Saddam attempted to dismantle the U.N. Security Council sanctions or "encourage" permanent members to veto the use of force against Iraq by allocating lucrative contracts for the development of giant Iraqi oil fields to companies from Russia, France, and China. The power of Saddam's regime to allocate these contracts in view of their corrupt nature is questionable, and the circumstances surrounding the granting of these contracts need to be re-examined.

Of course they do. Otherwise, how could ownership pass to American oil corporations? The "Needed Comprehensive Economic Reform"?

The Bush Administration, its allies, and international organizations should prepare, encourage, and support the future leaders of a post-Saddam Iraqi government to develop a comprehensive economic reform package. Specifically, in addition to the reforms outlined above, a new federal Iraqi government must take steps to create a modern legal environment that recognizes property rights and is conducive to privatization; educate and prepare the people of Iraq for structural economic reform and privatization through a public information campaign; deregulate prices internally, including in the utilities and energy sector; prepare state assets, including industries, utilities, transportation, ports and airports, pipelines, and the energy sector, for privatization; keep the budget balanced and inflation, taxes, and tariffs low; and liberalize and expand trade, and launch an effort for Iraq to join the World Trade Organization.

It could have been summed up in a simple phrase: let Americans profit from Iraqi oil. Chalabi is certainly the Heritage Foundation's man. And we shouldn't forget this gem from John Hulsman and James Phillips of the Heritage Foundation:

U.S. Objectives. Washington should place the highest priority on helping to facilitate a post-war government that would enable America to consolidate its main war aims. These are: (1) eliminating Iraq's long-range missiles and WMD programs, (2) ending its threats to the security and stability of the Persian Gulf region, and (3) ensuring international access to its energy resources.

(1) is moderately legitimate given the American government's interest in protecting its client Israel. (2) is pure pretext. (3) is only a half-truth. As Cohen and O'Driscoll were happy to point out in their piece above, Iraq has granted international access to its energy resources: to Russia, France, and China. Apparently, "international access" means "American access." The ruling class remain true to their Orwellian roots after all.

Who is Ahmad Chalabi? Valiant opposition dissident or criminal banker?

Born in 1945, Chalabi is the scion of a wealthy, oligarchic Shi'a family with close ties to the Hashemite monarchy that was installed in Iraq after World War I by Lawrence, Gertrude Bell and the British imperial authorities. Chalabi's grandfather served in nine various Iraqi cabinet positions, his father was a cabinet officer and president of the figurehead Iraqi senate, and his mother ran political salons that catered to Iraq's elite. In 1958 that all came to a crashing end when a coalition of army officers and the Iraqi Communist Party led a revolution that toppled King Faisal II. The Chalabis scattered.

As a young man Chalabi lived in Jordan, Lebanon, the United Kingdom and the United States, where he attended MIT before earning a doctorate in mathematics at the University of Chicago. He took a position teaching math at the American University of Beirut. In 1977, Crown Prince Hassan of Jordan invited Chalabi to Amman to establish the Petra Bank, a financial institution that would soon become the second-largest commercial bank in Jordan.

In an August 1989 episode still surrounded by controversy, however, the government of Jordan seized the Petra Bank under martial law, arresting its chief currency trader and using Jordan's central bank to pump $164 million into the Petra Bank and its allied institutions to keep them liquid. To avoid arrest, Chalabi fled the country "under mysterious circumstances," according to a 1989 article in the Financial Times. The Hudson Institute's Max Singer says that Prince Hassan personally drove Chalabi to the Jordanian border, helping him escape. (According to one account, Chalabi was in the trunk of the car.) Chalabi eventually was tried in absentia by a Jordanian court and sentenced to 22 years of hard labor for embezzlement, fraud and currency-trading irregularities. He reportedly got away with more than $70 million.

The INC offers a different version. According to Zaab Sethna, an INC spokesman, King Hussein of Jordan executed a politically motivated coup against Chalabi in coordination with Iraq because Chalabi was "using the bank to fund [Iraqi] opposition groups and learning a lot about illegal arms transfers to Saddam." Because the Petra Bank had inside information about Jordanian-Iraqi trade, Chalabi used his position in a freelance, cloak-and-dagger operation to feed intelligence about Iraq's trade deals to the CIA. Because Chalabi was already active in anti-Iraq opposition groups and had a connection with Perle, it's possible that Chalabi's account is true.

Further evidence of political motives behind the seizure of the Petra Bank and Chalabi's intelligence connections: The American lawyer who represented the Petra Bank's Washington, D.C., subsidiary was former Secretary of Defense Caspar Weinberger. And when Chalabi fled the country, anonymous leaflets reportedly circulated linking Chalabi to an alliance with Iraq's Shi'a and with (mostly Shi'a) Iran, all in a vague conspiracy against Iraq and Jordan. (During the Iran-Iraq war and Iraq's invasion of Kuwait in 1990, Jordan -- always delicately balanced between "Iraq and a hard place," as King Hussein was wont to say -- tilted toward Iraq. Afterward, King Hussein distanced himself from Baghdad and eventually reconciled with Chalabi. The jail sentence for bank fraud stands but reportedly might be lifted soon by Jordan's King Abdullah.)

Of course, the fact that Chalabi may have been prosecuted for political reasons does not mean that he is innocent of embezzlement and fraud. In any case, allegations of self-dealing have followed him everywhere since. ...

"He's a criminal banker," says [James E.] Akins, the former [United States] ambassador to Saudi Arabia. "He's a swindler. He's interested in getting money, and I suspect it's all gone into his bank accounts and those of his friends."

The American Prospect, "Tinker, Banker, NeoCon, Spy; Ahmed Chalabi's long and winding road from (and to?) Baghdad" by Robert Dreyfuss, November 18, 2002

But is he the man who will obey Washington and turn Iraq's oil fields over to American and British oil corporations?

Since the Persian Gulf War in 1991, companies from more than a dozen nations, including France, Russia, China, India, Italy, Vietnam and Algeria, have either reached or sought to reach agreements in principle to develop Iraqi oil fields, refurbish existing facilities or explore undeveloped tracts. Most of the deals are on hold until the lifting of U.N. sanctions. But Iraqi opposition officials made clear in interviews last week that they will not be bound by any of the deals.

"We will review all these agreements, definitely," said Faisal Qaragholi, a petroleum engineer who directs the London office of the Iraqi National Congress (INC), an umbrella organization of opposition groups that is backed by the United States. "Our oil policies should be decided by a government in Iraq elected by the people." Ahmed Chalabi, the INC leader, went even further, saying he favored the creation of a U.S.-led consortium to develop Iraq's oil fields, which have deteriorated under more than a decade of sanctions. "American companies will have a big shot at Iraqi oil," Chalabi said.

Washintgon Post, "In Iraqi War Scenario, Oil Is Key Issue" by Dan Morgan and David B. Ottaway, September 15, 2002

Looks to be that way. It is significant that it was his army that was airlifted into the South of Iraq on April 4: "The force is under the control of the Iraqi National Congress and its leader, Ahmed Chalabi, who will accompany his troops into Iraq."

Will Chalabi carry the day?

More developments on the U.S. ensuring that it maintains ideological control over the new Iraqi government. This will be a puppet government in every sense of the word. And it is being done quite openly:

The Bush administration made it clearer than ever today, in sketching its vision for a democratically run Iraq, that it sees a decidedly secondary role for the United Nations in that country when the shooting is over. "The U.N. can be an important partner," Deputy Defense Secretary Paul Wolfowitz told the Senate Armed Services Committee. But he quickly added that he hoped the international organization could play "a much more positive role in the future" than it has in the past.

"And I think there's reason to think that it can and will," Mr. Wolfowitz went on. "But it can't - it can't be the managing partner. It can't be in charge. We need to make sure that certain functions are working smoothly from day one, and I think the goal should be to pass that responsibility as quickly as possible to Iraqis." The deputy secretary envisioned an Iraqi interim authority, which he said would draw from all of the country's religious and ethnic groups, embracing people now in the country and those who are outside. Organization of that entity can begin almost at once, he said.

"It will provide a way for Iraqis to begin immediately to direct the political and economic reconstruction of their country," Mr. Wolfowitz told the lawmakers. "The authority would include not only members of the free Iraqi groups that have fought Saddam's tyranny, and the independents among the expatriate community, but will also draw from local leaders who have already begun to participate with the coalition in the liberation of Iraq." ... Mr. Wolfowitz said he strongly agreed with the committee chairman, Senator John W. Warner of Virginia, who said the main partners in the military campaign in Iraq - the United States and Britain - should manage post-war Iraq, at least in the early going.

New York Times, "Bush Administration Describes Secondary Role for U.N. in Iraq" by David Stout, April 10, 2003

The invasion would have been useless had the U.S. been unable to choose the ideological outlook of the new Iraqi government. This is the primary reason why it favored invasion without even trying to involve the United Nations. That happened to appease Britain's Blair, though most likely the U.S. intended for it to fail to ensure its control over post-Hussein Iraq. On the heels of the above story came this one:

The Bush administration said today that it would begin next week to identify civilian leaders to help run Iraq, as tensions persisted between the State and Defense Departments over an interim authority that would pave the way for an elected government. ... Mr. Wolfowitz said that the meetings [to seek out candidates for civilian leadership posts] in Iraq would occur over the next several weeks or months and would draw civilians from all ethnic and religious groups, inside and outside the country, whom the American authorities identified as "notables or potential leaders" or people "with distinguished credentials." American officials emphasized that American and British military forces would play "the leading role" in setting up an Iraqi government, and that the United Nations would play a "vital" but decidedly advisory role limited to coordination of food, medicine and other relief supplies.

Administration officials said it was not clear whether Ahmad Chalabi, the head of the Iraqi National Congress and a favorite of several in the administration to play a leading role in a postwar Iraq, would attend the first meeting. Mr. Wolfowitz said the Pentagon was not singling out Mr. Chalabi for a leadership role. Mr. Chalabi's potential role has been a particular point of friction between the Pentagon and the State Department, which views him with skepticism because he has been in exile for so long.. Vice President Dick Cheney, Defense Secretary Donald H. Rumsfeld and Mr. Wolfowitz are among his powerful allies.

[Wolfowitz] said he envisioned an authority that would be divided into a representative council and a smaller executive committee. Once the interim authority is established, he said, it will work with the Pentagon-led reconstruction effort, headed by Lt. Gen. Jay Garner, who is retired, and then begin setting up local elections and drafting a new constitution. Mr. Wolfowitz emphasized the importance of assembling the right transitional authority, saying, "We do have a say in the interim authority, we don't have a say in the final government of the country."

...Mr. Powell was said to agree with Defense Department officials that one danger for a United Nations role would occur if various members of that body - Russia, France, Syria, Iran or other countries - started picking their own favorites to join the Iraqi Interim Authority. The fear in Washington is that this would balkanize the Iraqi governing body and produce a fractious group with mixed loyalties.

New York Times, "U.S. to Recruit Iraqi Civilians to Interim Posts" by Eric Schmitt and Steven R. Weisman, April 11, 2003

Of course, while the U.S. insists on installing a puppet government loyal only to it, it is happy to let others foot the bill (in true free-market capitalist style): "Administration officials said today that in addition to seeking leaders they were appealing to some allies for material help, including personnel to help keep order, in postwar Iraq." Every capitalist loves a subsidy.

Liberation of Baghdad from Hussein has arrived. Liberation of Kirkuk from the Kurds to follow:

Kurdish military forces, backed by U.S. air power, stormed into the crucial northern Iraqi city of Kirkuk this morning and captured it virtually without firing a shot. Iraqi defenders who had survived a wave of B-52 strikes fled, leaving uniforms and ammunition behind, as the Kurdish troops poured into the city. Jubilant residents rushed into the streets to celebrate liberation from the rule of Saddam Hussein. ...

Turkey, Iraq's neighbor to the north which strongly opposes Kurdish control over Kirkuk, immediately announced that it would send military "observers" to the city, a move it said had Washington's assent. Foreign Minister Abdullah Gul said he spoke with Secretary of State Colin L. Powell earlier today and Powell offered to let Turkey send military observers to Kirkuk to make sure that Iraqi Kurdish fighters withdraw from the city. "We've accepted this," Gul said. In Washington, Powell confirmed to reporters that he had struck a deal with Gul. Basically they reaffirmed an earlier agreement in which Turkey agreed not to deploy large-scale military units to the Kirkuk region and the United States promised that the Kurds will not establish permanent control over the city.

Gul's comments to reporters in Ankara reflected the depth of his country's concern about the status of Kirkuk, a multi-ethnic city of more than 700,000 residents in the center of Iraq's northern oil fields. Turkey fears the ethnic Kurds of Iraq would use control of Kirkuk to press for regional autonomy or even independence from Baghdad, possibly stirring similar sentiments among the large Kurdish population of southeastern Turkey. Only intense pressure from Washington prevented Turkey from sending a large military force into Iraqi Kurdistan as U.S. and British troops invaded from the south three weeks ago. Had Turkey done so, the Kurdish militias known as pesh merga would probably have fought them rather than the Iraqis.

At the White House this morning, officials sought to dampen Turkish concerns. "We've been in contact with officials in Turkey as well as free Iraqis in the north and I think it is fair to say that American forces will be in control of Kirkuk," spokesman Ari Fleischer told reporters. ...

The Kurdish fighters who entered the city are nominally part of the U.S.-led coalition fighting together to destroy the Saddam Hussein regime. In theory, the Kurds will work with the United States and Britain to establish an Iraq-wide postwar government that will include Kurdish representatives, rather than seek independence. The sudden evaporation of Hussein's government and security forces could entice the Kurds into rethinking that arrangement, U.S. and Turkish officials fear. U.S. policy is to maintain Iraq as a unified country.

Washington Post, "Kurdish Military Forces Capture Kirkuk; Entry Into Oil-Rich City Heightens Tensions With Turkey" by Thomas W. Lippman, April 10, 2003

Everybody is agreed that Iraq's territorial integrity be maintained. Nobody wants to liberate the Kurds. Indeed, the U.S. is affirmatively collaborating with Turkey to repress them (even though, as the article points out, the Kurds in Iraq would be more likely to fight the Turkish military than Hussein's army).

More on the new national Iraqi army that will be defending the U.S. government's installed puppet government in Iraq:

US forces have begun to airlift Iraqi opposition fighters into southern Iraq, it has emerged.
The deployment, which is said to have begun on Friday night, will move about 1,000 men to a base in southern Iraq controlled by coalition forces. The force is under the control of the Iraqi National Congress and its leader, Ahmed Chalabi, who will accompany his troops into Iraq. Its stated aims are:

• To assist liaison between coalition forces and leaders of the Shia Muslim population in southern Iraq.



• To help coalition forces in the area clear remaining resistance from militias loyal to Iraqi President Saddam Hussein, and restore security.

"These are Iraqi citizens who want to fight for a free Iraq, who will become basically the core of the new Iraqi army once Iraq is free," General Peter Pace, vice chairman of the US Joint Chiefs of Staff, told the American television network ABC. The fighters were volunteers "from all over", including expatriates arriving from the United States, he added. Coalition troops in southern Iraq have had a mixed reception from local people, despite the apparent distaste of the majority Shia population for Saddam Hussein.

BBC News, "Iraqi opposition force in S Iraq," April 6, 2003

The article listed two explicit "aims" of the new national Iraqi army. Whether intended or not, they also listed the third: to be the "core" of the future national Iraqi government, clearly subservient to Washington ("...including expatriates arriving from the United States"). Indeed, the propaganda has already begun: these are "freedom fighters." And if the Iraqi people begin to resist the installed government, they will be labeled "terrorists" seeking the downfall of the new "democratic Iraqi government" which the "freedom fighters" will have to fend off for the sake of liberty itself, rather than the crass commercial and power interests of Washington.

The installed government will likely be ethnically diverse in order to give it the outward appearance of representation. It will be ideologically homogenous. The homogeneity will consist of agreement as to subservience to Washington.

President Bush and Prime Minister Tony Blair of Britain pledged today to grant the United Nations a "vital role" in post-war Iraq, but Mr. Bush described that role as largely humanitarian and advisory rather than one central to overseeing the country and eventually establishing a new government. During a break in a second day of meetings here with Mr. Blair, the president said he envisioned the United Nations providing food and medicine, collecting donations and offering suggestions about the composition of an interim governing authority, composed of Iraqis from inside and outside the country, to be set up by the United States and Britain. But Mr. Bush appeared intent on retaining for the United States and Britain the right to decide on the members and powers of the temporary authority, effectively holding the United Nations to a more limited role than sought by many European nations and, to some extent, Mr. Blair, the president's main ally in the conflict with Iraq.

New York Times, "Bush Sees Limited Role for U.N. in Postwar Iraq" by Richard W. Stevenson, April 8, 2003

Imperialism dictates the American government choose who rules Iraq. The U.S. will install an "interim" government and hope its momentum as "incumbent" will help it "stick" during Iraqi elections (using all the propaganda tactics of the American power elite).

Should the U.S. government feel that no such government of its choosing will stick, it will resort to staged elections and violence, probably through a proxy Iraqi military force funded by the American government, in order to make it stick a la South Vietnam, Guatemala, and El Salvador.

("Hundreds of Iraqi fighters opposed to Saddam Hussein have been airlifted into southern Iraq to battle the remnants of his military and, even more important, to serve as the vanguard of a new national army, senior American military officials said today."--New York Times, "Iraqi Fighters, Hussein Foes, Are Flown Into the South," by Thom Shanker, April 7, 2003)

Clearly, if the government sticks then there won't be much for me to do here. But it is doubtful that it will stick. It will also be unfortunate for Iraqis if it sticks as it will result in nothing but the exploitation of their natural resources (oil).

In the coming years, I intend to follow up and try to explain what is going on in Iraq by way of this weblog.