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Saturday, May 26, 2007

Bush and bin Ladin join forces, or, extraordinary stupidity, ordinary blowback

One of the many obsessions of this blog is to highlight the failures of George W. Bush and company to appreciate the differences between Sunni and Shia Islam as well as the differences between the various armed Islamist groups. (See, for instance, my entry of January 27, 2007.) In short, Bush et al. don't seem to understand the fundamental incompatibility between Salafist Sunni groups like al-Qa'ida and Shia groups like Hizballah, nor can they properly appraise the relative threats that each set of actors poses to the United States and its interests.

It was thus with great dismay that I read Seymour Hersh's article 'The Redirection' in the March 5, 2007 issue of the New Yorker. Hersh claims that the Bush people, in their mind-boggling anti-Shia zeal, are distributing money and weapons to violent anti-Shia groups. And who is the most belligerent anti-Shia group in the world? Why, al-Qa'ida, of course. According to Hersh, covert money and matériel from the U.S. are, by design, making their way into al-Qa'ida's hands because they are apparently Bush's new ally in a joint jihad-crusade against Shiites.

Since the assassination of Lebanese Prime Minister Rafik Hariri in February 2005, Bush's policy towards Lebanon has been to support Prime Minister Fouad Siniora's government in the face of opposition from Hizballah. That in itself is neither remarkable nor objectionable. The problem arises when one considers what that support includes. According to MI6 veteran Alastair Cooke, quoted in Hersh's article, the Lebanese government has passed these covert funds and weapons on to Fatah al-Islam, a Salafist splinter group operating in Lebanon's Nahr al-Bared refugee camp, to be used in campaigns against Hizballah. Anyone with any knowledge of the history of U.S. covert operations can already guess where this story is headed.

Let's recall Bush's many statements about states that harbor terrorists. My favorite is this one from September 25, 2001:

'Well, I think most people in the world understand that I was very serious, and they're serious, when we say if you harbor a terrorist, you're just as guilty as the terrorist.'

If Bush is as serious as he claims, then he should be ordering strikes on Lebanon right about now. From Hersh's article:
'In an interview in Beirut, a senior official in the Siniora government acknowledged that there were Sunni jihadists operating inside Lebanon. "We have a liberal attitude that allows Al Qaeda types to have a presence here," he said.'

That 'liberal attitude' is now part of the Bush-Siniora policy of using al-Qa'ida 'types' to fight Hizballah. That's a bit like arming Hitler to fight Musolini.

What amazes me most about this insane policy is not its hypocrisy but the fact that U.S. policymakers continue to operate at such levels of political intrigue in the first place. What makes them think they can maintain control over so many variables and rogue elements?

We can speculate about how much of this covert support is directly being used against U.S. interests in the region. Has any of it been used against U.S. troops in Iraq, for instance? Or we can read the day's news and find evidence of it. Fatah al-Islam, the Salafist group named above as a beneficiary of this mad policy, last week turned its weapons on the Lebanese government. And now the U.S. is sending 'plane-loads of American military supplies' to the Lebanese government to help it fight Fatah al-Islam, according to the BBC. Your tax dollars at work, arming both sides.

Whether Fatah al-Islam is an official al-Qa'ida affiliate or just an ideological clone is irrelevant. The U.S. should not be arming any Salafist groups anywhere in the world. I can't believe that this needs to be said. It's a bit like saying habeas corpus is worth defending. I have been a critic, to say the least, of George W. Bush since the beginning, but even I am surprised by this latest turn of events. Is there no level of dangerous stupidity to which Bush and his policymakers will not stoop? Alas, I have no doubt that I will soon be surprised yet again.

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27 Comments:

Anonymous Mr. Myorkas said...

You refer several times in this post to concerns about the Bush administration's failure to grasp "US interests", a sentiment which runs parallel with a sinking feeling I've been experiencing that nation states are just sooo passe and "20th century". Welcome to the 21st century where geographical associations are only relevant to the new serfs. Anyone without a private jet and homes on multiple continents is bound to feel a bit put off when their local government adopts policies bizarely out of tune with local or "national" interests. But the shareholders of major arms manufacturers are bound to understand the only way to realize stable returns and profits is to utilize the nation state system as a series of valves and pipes. Release a bit of pressure in the east... turn a valve in the west... What else can they do? After all if they loose the ability (money) to maintain multiple mansions around the world they might get stuck in a war somewhere, and wars can be nasty.

5:14 PM, May 29, 2007

 
Blogger Jeff Strabone said...

When I mentioned U.S. 'interests', I was neither endorsing nor critiquing those interests, nor was I critically considering the construction of national interests as a paradigm for understanding the behaviour of state actors. Instead, I had in mind the question of Bush's competence. However he constructs U.S. interests, he relentlessly proves again and again that he and his associates are utterly incompetent to promote the interests that they prioritize. In the case of al-Qa'ida versus Hizballah, the Bush people cannot even recognize which of the two poses a greater threat: the one that crashes aeroplanes into buildings and would do it again, or the one that fields candidates for the Lebanese parliament. But that's what happens when foreign policy is designed by people who regard the Iran-contra affair as a valid model to follow.

As for the scenario of faceless corporate Geppettos pulling strings or turning valves, I have never believed that the real world could ever be so easily directed nor that anyone is sufficiently omniscient to succeed at doing so. People may try, but the number of variables is too great.

Finally, it is nice to know that Mr. Mayorkas, our old French teacher from Stuyvesant High School is alive and well. He wasn't when we were in his class, so that's definitely progress.

6:28 PM, May 30, 2007

 
Anonymous blingbling said...

However he constructs U.S. interests, he relentlessly proves again and again that he and his associates are utterly incompetent to promote the interests that they prioritize.

Really? The price of oil, and thus US oil-company profitability, as well as the profitability of KBR/Halliburton etc, are all holding up pretty impressively.

Or were you confusing the interests they prioritize with the interests they say they prioritize?

8:20 PM, May 30, 2007

 
Blogger Jeff Strabone said...

Bling Bling is no doubt right that the petrol and construction companies have made out like bandits during the Bush years, Halliburton and KBR especially. I tried to see if the picture was more complicated than that. Here is what I found.

Over the past four years, Halliburton's profits have steadily risen each year and its stock price has tripled over that time. KBR, publicly traded since November 2006, is posting rising profits, its stock up from 21 to 27. Bechtel, the other Republican-connected big player in Iraq, is a private company and does not report financial data as publicly traded companies do.

Has their rapacity been hampered or complicated in any way? There are a few considerations, not least of which has been the impossibility of profitting from Iraqi petrol per se. Halliburton et al. have profitted from government contracts, many no-bid, for construction services. Construction projects have run wildly over-budget or failed to be built as security costs ate up the funds. Is that evidence of incompetence or of an evil master plan to suck more money? Perhaps a bit of both. Bechtel in particular has been spanked more than other corporations in Iraq.

Here is the opening from a July 27, 2006 New York Times article entitled 'Series of Woes Mar Iraq Project Hailed as Model':

---------
'The United States is dropping Bechtel, the American construction giant, from a project to build a high-tech children's hospital in the southern Iraqi city of Basra after the project fell nearly a year behind schedule and exceeded its expected cost by as much as 150 percent.

Called the Basra Children's Hospital, the project has been consistently championed by the first lady, Laura Bush, and Secretary of State Condoleezza Rice, and was designed to house sophisticated equipment for treating childhood cancer.

Now it becomes the latest in a series of American taxpayer-financed health projects in Iraq to face overruns, delays and cancellations. Earlier this year, the Army Corps of Engineers canceled more than $300 million in contracts held by Parsons, another American contractor, to build and refurbish hospitals and clinics across Iraq.'
---------

Bechtel has since abandoned Iraq for good. Surely they made some coin in Iraq, and surely Bush and Cheney are the most venal men to ever occupy the White House. But how much more money could they be making without all the failures? A construction company leaving a war-torn country still in ruins? I hope we can agree that that demonstrates incompetence.

Finally, another failure vis-a-vis corporate interests is the high death toll of their employees killed in Iraq. According to the New York Times for May 18, 2007, 146 contract workers have been killed in Iraq this year. Since the war began, at least 917 have been killed and over 12,000 injured. Sure, one could write off those deaths to corporate indifference to occupational safety and health, but I would like to think that people don't enjoy seeing their own employees die.

4:15 AM, May 31, 2007

 
Anonymous blingbling said...

I believe they handled quite competently the destruction of Iraqi infrastructure, creating the initial conditions in which US companies could be gifted the Iraqi reconstruction contracts. KBR/Halliburton's notorious price-gouging has been pursued very competently from the point of view of its own profitability.

the impossibility of profitting from Iraqi petrol per se.

i) $20 billion of Iraqi oil revenue that the UN commanded should be spent "to meet the humanitarian needs of the Iraqi people" was given, mostly as you point out in no-bid contracts, to Halliburton/KBR etc.

ii) The "hydrocarbon law" that Bush/Cheney is currently demanding that Iraq pass allows for US oil companies to be granted 30-year contracts to extract and sell Iraqi oil, paying only a rock-bottom 12.5% royalty to the Iraqi government. (See Dennis J Kuchinich's recent statement to Congress.) As we know, US oil companies and their workers in Iraq already enjoy complete immunity from criminal prosecution or civil lawsuits in the US, thanks to Executive Order 13303.

6:34 AM, May 31, 2007

 
Anonymous blingbling said...

According to the New York Times for May 18, 2007, 146 contract workers have been killed in Iraq this year. Since the war began, at least 917 have been killed and over 12,000 injured.

Those are interesting figures. Do "contract workers" include the large number of private "security" or paramilitary workers, ie mercenaries?

6:36 AM, May 31, 2007

 
Anonymous blingbling said...

See also Greg Palast's article Bush Didn't Bungle Iraq, You Fools, a précis of some of the material in Armed Madhouse.

"The rise in the price of oil after the first three years of the [Iraq] war boosted the value of the reserves of ExxonMobil Oil alone by just over $666 billion."

9:18 AM, May 31, 2007

 
Anonymous Mr Mayorkas said...

I was actually going even farther than that. I was suggesting that judging from results, the goal of this administration is to further the interests of a class of businesses which profit from war. This administration has been staggeringly competent at furthering such interests. Needless to say human decency and common sense make it impossible to take such a notion seriously. But I am an indecent man possessed of a seething hatred for all you brats who never took my French class seriously. Besides classes of business which seek to perpetuate themselves find justifications for doing so which society deems acceptable commensurate with their scale. (Enron, World Com... So long as they were big, they were beyond question... just like Pfizer and Sanofi today). We accept that this "war" is driven by concern about existing threats which we are inadvertently stoking and stimulating through ineptitude then we marvel at that ineptitude as you are doing. Instead it seems to me we should be considering that the threats are of an order of magnitude less severe that the anxiety our government projects upon them, and that we are exacerbating them, and funding two such conflicting groups, precisely so that they will grow large enough to justify that very anxiety. Conveniently this will also justify the maintenance of arms industries and supplies which might otherwise tend to be deemphasized and decline with the flattening of the world.

Not sure that I follow your introduction of Geppetto though I trust it is relevant in a way I don't grasp.

Far from being Geppettos however I imagine these interests to be utterly human complete with IDs, rationalizations and sublimated impulses.

Clearly profit is not this administrations object. I'm sure they believe this. Clearly their goal is defense against all these threats. I'm sure they believe this too. So long as one takes them at their word, your analysis makes sense. Jeez! Look at this incompetence? Look at the staggering contradictions.

I say look at the self sabotage. I say look at the behavior of a government, economy and society functioning like a flesh and blood alcoholic or addict self destructively creating a "Crisis" which will justify taking another drink.

What I'm suggesting are that the refrains "I quit smoking!" and "I quit drinking!" can be compared to "Our economy and society have moved beyond the cold war mentality!"

The correlatives are "I lost my job... I need a smoke!" "My wife left me I need a drink!" and "Radical Islamic fundamentalists are threatening our values and interests! We need to build up our intelligence and defensive capacities."

In each circumstance the interests that benefit are never those of the addict (or in this case nation state) but rather of the pusher, bar keep or munitions / intelligence technology provider.

If the notion of a nation or system functioning like an addict seems to be without precedent consider the chorus of voices that debated the relative merits of, but rarely questioned the underlying metaphor for, the president’s assertion that America is addicted to Oil.

That's like saying a drunk is addicted to olives. It's the martinis they go in that count, just as it's the jets, bombers, tanks and naval ships the gas goes into the world over that really guzzle the most fuel.

You may now proceed to dismiss me. It's all right. I know you still can't speak decent French.


That's ok. Neither can I and I taught French for 25 years.

10:41 PM, June 01, 2007

 
Blogger Jeff Strabone said...

The question has arisen whether George W. Bush's actions in Iraq can be called incompetent when they have undeniably and monstrously profitted U.S. petrol and construction companies. As previously argued, Bechtel at least has been driven out of Iraq despite the country's obvious need for construction services. But Bechtel's case does not go to the heart of the matter. Let us pose the question as directly as possible: do the petrol sector's windfall profits since the start of the war in Iraq disprove the case for incompetence.

The question is not Halliburton et al.'s profitability or Bush's zeal in making Halliburton et al. as profitable as possible. The question is Bush's competence in making Halliburton et al. as profitable as possible.

I will take it as an article of faith that all of the major U.S. corporations with an interest in Iraq or petrol have made out like bandits and that the war in Iraq is a direct cause of their banditry. But I maintain that they could be making even more money in a stable, petrol-exporting Iraq.

One can say that war is good for profits, but peace is also good for profits. World War Two enriched several sectors of the U.S. economy, but so did the Marshall Plan and the next three decades of peace and prosperity in Europe.

Because I am not an economist, I cannot supply the data to demonstrate that peace is more profitable than war, but I do at least have enough facts to dispute Blingbling's arguments and to make the case for a more profitable peace in Iraq (besides the already argued point about Bechtel forgoing future Iraqi business due to security issues).

Blingbling has argued two points that cannot simultaneously be true. One is that U.S. petrol corporations hope to profit from the U.S.-drafted hydrocarbon law being foisted on the Iraqi parliament. The law would apparently allow U.S. corporations to extract and sell Iraqi petrol for thirty years. Then he approvingly cites Greg Palast's poorly reasoned article arguing that the U.S. wants to stifle the flow of Iraqi petrol. Either U.S. corporations would profit from extracting and selling Iraqi petrol or from keeping it off world markets, but they can't do both.

I don't dispute Blingbling's cited fact that ExxonMobil's reserves have risen in value by $666 billion, an evil number, in three years. My point is that they and Bechtel and others could make even more money in a functioning, grateful Iraq. The petrol companies appear to agree. Why else are they trying to get their hands on Iraq's petrol in the first place?

Bush can foist all the hydrocarbon laws on a failed state that he wants. It will all be undone by a future pro-Iran, anti-U.S. government. And that would be the ultimate incompetence.

5:13 PM, June 04, 2007

 
Anonymous blingbling said...

Blingbling has argued two points that cannot simultaneously be true. One is that U.S. petrol corporations hope to profit from the U.S.-drafted hydrocarbon law being foisted on the Iraqi parliament. The law would apparently allow U.S. corporations to extract and sell Iraqi petrol for thirty years. Then he approvingly cites Greg Palast's poorly reasoned article arguing that the U.S. wants to stifle the flow of Iraqi petrol. Either U.S. corporations would profit from extracting and selling Iraqi petrol or from keeping it off world markets, but they can't do both.

You erect a false dichotomy. But before explaining why, I must apologise for directing you to an article you find "poorly reasoned", though you do not précis it accurately. Mr Palast does not argue that "the US" as a homogenous entity "wants" to stifle the flow of Iraqi oil. On his reading, the neocons (Wolfowitz etc) wanted to exploit Iraqi oil and sell it cheaply to smash OPEC and in particular Saudi Arabia, but the oil barons (Cheney etc) wanted to make sure that didn't happen so as to keep on profiting. The latter won. Anyway, Mr Palast's book is quite well reasoned (his reports on this subject for Newsnight have at least survived the attentions of the BBC's legal department), if irritating in some other ways, and I commend it to you.

I will now explain why your complaint is a false dichotomy. Simply, because from the point of view of US oil companies, both actions - either preventing exploitation, or getting contracts for exploitation - are means to controlling the supply. If Iraqi oil production is massively down from the Saddam era, as it has been since the invasion, then supply is controlled, prices rise, and US oil corporations profit. If those same US oil corporations get contracts for the Iraqi oil wells, they will also thereby control the supply and profit at will by determining how much to pump and sell. You think they're going to rush in there, turn on the spigots, and flood the market with cheap oil, like the neocons wanted all along? Ain't gonna happen, buster!

8:37 PM, June 04, 2007

 
Blogger Jeff Strabone said...

There is merit in what Mr. Mayorkas, more than in his French classes at Stuyvesant back in the day. Even so, the problem of energy security, an obsession of Dick Cheney in particular, scuttles a bit of Mayorkas's argument, particularly the bit about arming conflicting groups for the sake of generating weapons orders. If energy security and arms manufacturing are both priorities of Bush/Cheney, then how are we to understand the distribution of arms to groups, i.e. Sunni jihadists, that, in Iraq at least, are blowing up petrol pipelines and facilities? (See my next reply to Blingbling for more on the energy security point.)

There is, of course, a precedent for operating at such cross purposes. In the 1980's, Reagan armed the Angolan rebel group UNITA which was trying to blow up U.S. petrol facilities in Angola being defended by Cuban troops. Ah, the simpler days of the Cold War.

5:45 PM, June 07, 2007

 
Blogger Jeff Strabone said...

I completely agree with Blingbling that the U.S.—corporations and government alike—want to control the supply of Iraqi petrol. But the question of whether to horde or to sell is a market question whose answer will change from time to time. And in order for that level of control to exist, energy security comes first. That is priority number one for Bush/Cheney in Iraq and elsewhere. (May I refer you to page 63 of my friend Steve Poole's excellent book Unspeak, where the matter of preventing disruptions in the global petrol supply is briefly addressed?)

That the U.S. occupation of Iraq has failed to secure petrol pipelines and other petrol infrastructure is surely indisputable evidence of grand incompetence. I am sure Blingbling recalls that U.S. troops did nothing to stop looters across Baghdad in April 2003, except where petrol was concerned. From the New York Times for April 16, 2003:
'In other parts of Iraq, American forces followed the military's plan to to secure oil wells, dams and other critical sites ahead of the troops' main advance, and in Baghdad they secured at least the oil ministry and kept looters at bay.'

Allowing the museums and archives to be looted was not incompetence: Bush and Cheney don't care about museums and archives. Allowing a level of violence that makes doing business in petrol and construction impossible: that is definitely incompetence.

6:05 PM, June 07, 2007

 
Anonymous blingbling said...

(May I refer you to page 63 of my friend Steve Poole's excellent book Unspeak, where the matter of preventing disruptions in the global petrol supply is briefly addressed?)

There is a difference between suppression of supply when you know you have enough reserves to profit from it, and undesirable or unpredictable "disruptions", eg by Saudi Arabia getting uppity. (Since the Iraq war enabled the US to move its permanent bases out of Saudi Arabi and into Iraq, of course, it no longer needs to take quite such a submissive position vis-à-vis Saudi.)

That the U.S. occupation of Iraq has failed to secure petrol pipelines and other petrol infrastructure is surely indisputable evidence of grand incompetence.

But it's simply not true that "the U.S. occupation of Iraq has failed to secure petrol pipelines and other petrol infrastructure".

I am sure Blingbling recalls that U.S. troops did nothing to stop looters across Baghdad in April 2003, except where petrol was concerned.

Right: except where petrol was concerned. (They even warned the Iraqi army not to burn oil wells before the invasion.) So what on earth causes you to think they "failed" to secure the oil infrastructure? It's the only damn thing they did secure.

Allowing a level of violence that makes doing business in petrol and construction impossible: that is definitely incompetence.

Since when has the war in Iraq made "doing business in petrol" impossible for US oil companies? On the contrary, as I have explained in previous comments, the lowering of the Iraqi oil supply to the international market from pre-war levels has enabled vast profits to be trousered by the oil corporations. And now, presumably because they feel market conditions make it a profitable move, they are jostling for juicy 30-year drilling contracts. They seem to think that doing business is very possible indeed.

Doing business in construction is hardly impossible either. Your example of Bechtel leaving (after several years of profit) does not outweigh all the rest of the construction profiteering that has gone on and continues by other companies. (By the way, a large part of Halliburton's profits come from "oil services", a happy coincidence.)

I do not argue that the Cheney administration has done everything right, of course. If they hadn't been so idiotic as to sack the entire Iraqi army, they could have used them to secure their own interests more quickly.

On the other hand, I'm wary of any idea - which you seem to be implying - that there was an alternative, "competent" way to conduct the invasion and occupation that would have resulted in happy, grateful Iraqis dancing around and throwing flowers in peace and profit. The State Department and the Foreign Office, to name two nexuses of expertise, never thought that was an option in the first place, and told their governments so.

In any case, so many hundreds of billions have been gouged that I maintain it is dreadfully unfair to accuse the profiteers of incompetence.

3:32 AM, June 08, 2007

 
Blogger Jeff Strabone said...

I was wrong to call doing business in Iraq in 2007 'impossible'. That was an exaggeration. What I should have said is that the cost of doing business in both petrol and construction has dramatically risen, rather than dropped, between 2003 and 2007. That rise can be measured in security costs; fatalities of U.S. troops, workers, and mercenaries; pipeline disruptions; and the Republicans' loss of the House and Senate in 2006 and probably the presidency in 2008.

Have Bechtel, Halliburton, ExxonMobil et al. profitted monstrously these past four years? I confess it freely. But the past four years may prove to be a short-term smash-and-grab operation rather than the multiple-decade-long bonanza that it could have been.

When the U.S. overthrew the Iranian government in 1953, it enjoyed a quarter-century of cooperation from the Shah. Since the Iranian revolution of 1979, Iran has stood defiantly outside the framework of the United States' global energy order. Looked at one way, twenty-five years of petrol predictability is a strong indication of 'competence' on the part of Eisenhower and Dulles.

Taking over fractious Iraq was never going to be as easy as overthrowing Mossadeq. But four years into this war, the costs of doing business are still rising.

As for the evidence that the U.S. has failed to secure Iraq's petrol supply and infrastructure, it's hard to know where to begin. The evidence is overwhelming.

Exhibit one
New York Times
February 5, 2006
Headline: 'Oil Graft Fuels the Insurgency, Iraq and U.S. Say'

'In one example, a sitting member of the Iraqi National Assembly has been indicted in the theft of millions of dollars meant for protecting a critical oil pipeline against attacks and is suspected of funneling some of that money to the insurgency, said Radhi Hamza al-Radhi, the chairman of Iraq's Commission on Public Integrity.'

[...]

'In another incident, the director of a major oil storage plant near Kirkuk was arrested Saturday, with other employees and several local police officials, and charged with helping to orchestrate a mortar attack on the plant on Thursday, a Northern Oil Company employee said. The attack resulted in devastating pipeline fires and a shutdown of all oil operations in the area, said the employee, who was granted anonymity because he was not authorized to speak publicly about the matter. Ali Allawi, Iraq's finance minister, estimated that insurgents reap 40 percent to 50 percent of all oil-smuggling profits in the country. Offering an example of how illicit oil products are kept flowing on the black market, he said that the insurgency had infiltrated senior management positions at the major northern refinery in Baiji and routinely terrorized truck drivers there. This allows the insurgents and their confederates to tap the pipeline, empty the trucks and sell the oil or gas themselves.'

'Iraqi officials also suspect, but have not proved, that Mr. Juburi funneled some of the money he was given to protect the pipeline to the insurgents who were attacking it.'

Exhibit two
New York Times
May 24, 2006
Headline: 'In Shadows, Armed Groups Propel Iraq Toward Chaos'

'The [16th] brigade, a 1,000-man force set up by Iraq's Ministry of Defense in early 2005, was charged with guarding a stretch of oil pipeline that ran through the southern Baghdad neighborhood of Dawra. Heavily armed and lightly supervised, some members of the largely Sunni brigade transformed themselves into a death squad, cooperating with insurgents and executing government collaborators, Iraqi officials say.'

[...]

'As much as Mr. Thuwaini despairs over the men under his command, he saved his fiercest criticism for the pipeline protection units run by the Ministry of Defense. One of those units was the 16th Brigade, which he and other Iraqi officials said was operating as a death squad in Dawra.

'Mr. Thuwaini said there were at least three other such brigades operating in Iraq that were also similarly out of control: the 9th, 10th and 11th Brigades of the Ministry of Defense's pipeline protection forces. Those three groups, Mr. Thuwaini said, appear to be cooperating with insurgents, regularly allowing oil pipelines to be destroyed.'

Exhibit three
New York Times
June 4, 2006
Headline: 'Attacks on Oil Industry in Iraq Aid a Vast Smuggling Network'

'The sabotage attacks that have crippled Iraq's oil pipelines and refineries for the past three years are now being used to aid a vast smuggling network that is costing the Iraqi government billions of dollars a year, senior Iraqi and American officials here say. Once thought to be only a tool for insurgents to undermine the government, the pipeline attacks have evolved into a lucrative moneymaking scheme for insurgents and enterprising criminal gangs alike.'

'Once thought to be only a tool for insurgents to undermine the government, the pipeline attacks have evolved into a lucrative moneymaking scheme for insurgents and enterprising criminal gangs alike.'

[...]

'Iraqi and American officials said they could not offer a total figure for what smuggling is costing the country every year, beyond asserting that it is in the billions.

'But Oil Ministry data suggest that the total was $2.5 billion to $4 billion in 2005, said Yahia Said, a research fellow at the London School of Economics and director of the Iraq Revenue Watch at the Open Society Institute, a policy foundation.

'Even at the low end, that would mean smuggling costs account for almost 10 percent of Iraq's gross domestic product, $29.3 billion in 2005.'

I could go on, and I have not even gotten to the Congressional testimony or the Special Inspector General for Iraq Reconstruction yet. The point is clear: Bush & Cheney have failed to secure Iraq's petrol infrastructure and supply. Instead, insurgents and gangsters have 'crippled', according to the Times, Iraq's petrol industry and have used reconstruction money and profits from smuggling to carry out further attacks. It's a spiral that is making the situation increasingly difficult to control or profit from.

I therefore repeat my claims: the U.S. has failed to secure Iraq's oil infrastructure, and this failure, given Bush and Cheney's priorities, constitutes incompetence.

3:50 PM, June 08, 2007

 
Anonymous blingbling said...

Is there sabotage of pipelines and other oil installations? For sure. They haven't secured the entire oil infrastructure down to the last nut and bolt. But if the stories you cite could be generalized to infer general insecurity of the oil infrastructure, what sense would the "Hydrocarbon Law", giving contracts to US oil companies to exploit Iraqi oil, make? Those contracts wouldn't be worth squat if the infrastructure was completely insecure. Consider This recent article in which the Iraqi oil minister complains about sabotage: it implies an upper estimate of about a quarter of Iraq's daily production lost to sabotage. In other words, they've secured 75% of the infrastructure - not bad in a country that they reduced to chaos in mere months. Do you find it "incompetence" that they've secured only 75% and not 100%? Well, 100% was always going to be a pipe dream.

But the past four years may prove to be a short-term smash-and-grab operation rather than the multiple-decade-long bonanza that it could have been.

That is mere speculation, based as it seems to me on, as I repeat, a mere fantasy about some "competent" invasion and occupation. Your analogy with Iran might be more pertinent if the US had invaded and occupied Iran in 1953, which, to my recollection, it did not.

For another view, perhaps you will allow me to quote more from Greg Palast, in this article, which you may find less poorly reasoned than the previous one:

"This month, Petroleum Economist Magazine reported that U.S. oil companies put passage of the oil law before security concerns as the deciding factor over their entry into Iraq. Iraq has the second largest oil reserves in the world, reserves that are cheap to exploit and worth literally trillions of dollars. U.S. oil companies want in, but on their own terms. They are, quite simply, trying to get the best deal possible out of a war-ravaged and occupied nation. They are also holding U.S. troops hostage. Let’s face it, once they get their lucrative contracts, they will still demand protection to get to work. What better security force is there than 140,000 American troops?"

6:15 PM, June 08, 2007

 
Anonymous blingbling said...

Apologies, the second article cited is not by Palast but by a guest at his site - which you may indeed find more palatable.

At any rate, I would argue that insecurity is demonstrably not an obstacle to profit for most of the war-profiteers we are considering. You cite the deaths of mercenaries as a cost - what is that to the mercenary companies? What, indeed, is the death of US troops to Dick Cheney? If it's a cost of doing business, it's evidently a very acceptable one to him.

6:23 PM, June 08, 2007

 
Blogger Jeff Strabone said...

I read the article you cited in the Independent for May 18, 2007. I would like to quote it myself:
'Every day saboteurs blow up Iraqi oil pipelines and Oil Ministry teams try to repair them in an endless war to strangle Iraq's oil exports to the Mediterranean. Right now the saboteurs have, perhaps temporarily, the upper hand.
' "It is as bad as it has ever been," says Dr Shahristani in an interview with The Independent. "If we can protect the pipeline we can add half a million barrels to our exports immediately." '

But I don't see the 75% figure you cited.

I would also like to quote from the guest article by Antonia Juhasz at Greg Palast's website:
'The devastating cost of an incomplete project was made clear when SIGIR undertook a full investigation of a Parsons Corp. contract to construct primary health care centers across Iraq. After more than two years and $186 million, only six of the planned 150 centers were complete. Parsons’ contract for the facilities was canceled. More importantly, the work was turned over to the Army Corps of Engineers, who then handed the contracts directly to local Iraqi companies.'

Items like that show two things: one, that a U.S. corporation devoured the money from a contract without completing the job and without penalty; and two, that the job was then given to Iraqi contractors. My reading is that Iraqi construction jobs are increasingly slipping out of the greasy fingers of the U.S. corporations that the war was meant to benefit. Although you and I think that's a good thing, that's not what was supposed to happen.

Another quotation:
'Under intense public pressure, our elected officials forced the Army to cancel Halliburton’s dearly beloved multi-billion-dollar LOGCAP contract.'

That was not supposed to happen either.

The part of the article that you had in mind is probably the part about the proposed legislation you earlier called Iraq's 'hydrocarbon law', a bill the Iraqi parliament has yet to pass despite years of lobbying and pressure from the U.S.

Let's say for the sake of argument that your 75% figure is correct, i.e. that the U.S. has secured control of 75% of Iraqi's petrol output. I am surprised at how cavalierly you are prepared to write off 25% of Iraq's output. I invite you to consider its value in dollar terms, not to mention the rising cost of securing the remaining 75%. Yes, I do consider 75% to be a failure, particularly when the beneficiaries of the missing 25% are, according to the journalism I cited in my previous comment, Iraqi insurgents and Syria. Somehow I don't think Bush and Cheney intended to share the loot with these parties.

I don't have a 'fantasy' about a more competent invasion. This dialogue began as a question as to whether Bush and Cheney's war in Iraq can be called incompetent or a failure when Halliburton et al. have profitted monstrously from it. I am simply pointing to the multitude of evidence that even the most cynical person would concede indicates failure, i.e. instances that show that in 2007 even U.S. petrol and construction companies are losing ground in Iraq.

Just for the record, I think the rising death tolls, of Americans and Iraqis alike, indicate failure as does the lack of electricity and other basic services. I see innumerable other evidences of failure and incompetence, but I am restricting my argument only to instances of failure to advance U.S. corporate interests.

Finally, one more exhibit. David M. Walker, the Comptroller General of the U.S. Government Accountability Office, testified before the House Government Reform Committee on April 25, 2006. From his opening statement:
'U.S. electricity, oil, and water projects have focused on restoring essential services, such as refurbishing and repairing oil facilities, increasing electrical generating capacity, and restoring water treatment plants but key reconstruction goals have not been achieved (see table 1). As of March 2006, oil, electricity, and water sectors were below the planned U.S. end state. Before the war, oil production in Iraq averaged 2.6 million barrels per day (mbpd). In March 2006, State reported that oil production was about 2 mbpd, significantly below the desired goal of 3 mbpd. A combination of insurgent attacks on crude oil and product pipelines, dilapidated infrastructure, and poor operations and maintenance have hindered domestic refining and have required Iraq to import significant portions of liquefied petroleum gas, gasoline, kerosene, and diesel.

'In March 2006, electric generation capacity was about 4,100 megawatts. This level was below the post-war peak of about 5,400 megawatts and the planned U.S goal of 6,000 megawatts. Insurgent attacks have weakened the grid and the lack of fuel and spare parts has contributed to disruptions in service. In the water sector, the U.S. goal of providing 2.5 million cubic meters of water per day has not been achieved. As of March 2006, only 1.1 million cubic meters of water per day was produced.

'Specifically, production levels for oil and electricity have consistently fallen below their respective pre-war levels. As shown in Figure 4, since 2004, oil production levels have consistently averaged below pre-war levels of about 2.6 mbpd. In addition, although the capacity for export is theoretically as high as 2.5 million bpd, export levels averaged about 1.4 million bpd in 2005.

'In the electricity sector, production has largely fallen short of the original target goal of producing 120,000 megawatt-hours of electricity per day. In May 2005, agency reports show this target goal was reduced to 110,000 megawatt-hours. As shown in figure 5, this target goal was last reached briefly in the summer of 2005 and has not been met since. In March 2006, about 89,000 megawatt- hours was produced. Agency reports have attributed the downward spikes in production to several causes, including planned and unplanned maintenance, fuel shortages due to insurgent attacks on oil pipeline that supply fuel to power plants, and limited supply of fuels.

'Further, supply has not improved much over last year when judged by hours of power. According to agency reporting, the national average of available electricity was 12.3 hours per day in the last week of February, 2006, and 11.7 hours per day last week of March. The average for Baghdad was 8.1 hours per day in February 2006, and 5.7 hours per day in March 2006. According to agency reporting, Iraqis have become greater consumers and this had dramatically altered demand and diluted the effect of increased generation capacity on actual results.'

There's more, including information about the deteriorating security situation causing construction projects to be scaled back.

My point remains the same: by any measure—even by the measure of profit to U.S. corporations in sectors favored by Bush and Cheney—we must, in 2007, regard Bush and Cheney as incompetent to promote the interests that they themselves have prioritized. The world is less safe, not more so, and the prospects for doing business in Iraq have never been worse.

12:33 AM, June 09, 2007

 
Anonymous blingbling said...

I don't see the 75% figure you cited.

My simplistic arithmetic was based on this:

"raq's only revenue is from the 1.6 million barrels a day of crude oil that the country exports out of the 2.2 million barrels a day it produces."

Assuming it actually consumes a bit itself, that means losses to sabotage etc are running somewhere under a quarter.

a U.S. corporation devoured the money from a contract without completing the job and without penalty; and two, that the job was then given to Iraqi contractors.

After the US company had already profited and not been penalized!

Yes, I do consider 75% to be a failure, particularly when the beneficiaries of the missing 25% are, according to the journalism I cited in my previous comment, Iraqi insurgents and Syria. Somehow I don't think Bush and Cheney intended to share the loot with these parties.

I'm sure they didn't! But I still think securing 75% of the oil infrastructure can hardly be called a failure. Perhaps we should call it a qualified success.

I don't have a 'fantasy' about a more competent invasion. This dialogue began as a question as to whether Bush and Cheney's war in Iraq can be called incompetent or a failure when Halliburton et al. have profitted monstrously from it.

Yes, you have been fantasizing as to a more competent invasion, in your comments regarding the Marshall plan and Iran, where you float an idea of how much more money Halliburton et all could allegedly have made in a peaceful post-invasion Iraq than the hundreds of billions they have already made, and then calling those hundreds of billions a "failure". For myself, I guess a lot of CEOs would dream of failing like that.

You then go on to quote how US companies have failed to restore the electricity supply and so forth. Sure they have. But have they failed to profit? They have not.

The world is less safe, not more so, and the prospects for doing business in Iraq have never been worse.

Let's not conflate the two issues. I entirely agree that the world is less safe, but did Cheney ever really think that invading Iraq would make it more safe?

The "prospects for doing business in Iraq" right now still look excellent for the US oil companies that will profit from the "Hydrocarbon Law" (it's one of Bush's "benchmarks" for how the Iraqi government is doing, amusingly), and, as I must keep repeating, hundreds of billions of dollars in profit have already been made. That's not a failure.

1:14 PM, June 09, 2007

 
Blogger Jeff Strabone said...

Another problem with your 75% figure is that it does not comprehend petrol not being produced because of disruptions. These figures from David Walker's 2006 Congressional testimony, quoted above, provide a better measure:
'Before the war, oil production in Iraq averaged 2.6 million barrels per day (mbpd). In March 2006, State reported that oil production was about 2 mbpd, significantly below the desired goal of 3 mbpd.
[...]
'As shown in Figure 4, since 2004, oil production levels have consistently averaged below pre-war levels of about 2.6 mbpd. In addition, although the capacity for export is theoretically as high as 2.5 million bpd, export levels averaged about 1.4 million bpd in 2005.'

But even those numbers raise questions. Basically, a lot less is being produced than U.S. planners had foreseen.

Otherwise, I think we agree on the facts but differ on the interpretation. Success is bigger than corporate profit, and even that is becoming harder to earn. We'll see what happens in the future. I would not be surprised if U.S. construction companies leave or get passed over. Nor would I be surprised if Iraq joins Iran outside the ambit of Washington's world energy order.

2:01 AM, June 10, 2007

 
Anonymous blingbling said...

Sure, but then we are back to the fact that suppression of Iraq's oil supply, by keeping prices high, has benefited US oil companies to the tunes of hundreds of billions of dollars.

Success is bigger than corporate profit

I agree with you that success ought to be defined as more than corporate profit; I was merely responding to your claim that the invasion was a "failure" even on Cheney-et-al's own terms. Yet on those terms, I continue to submit, it has been a roaring success.

Nor would I be surprised if Iraq joins Iran outside the ambit of Washington's world energy order.

Personally, I would be surprised at that: much US effort has been expended, and continues to be expended, in writing an Iraq constitution and set of laws precisely to make that impossible. But I make no claims to a superior ability to predict the future.

11:22 AM, June 10, 2007

 
Blogger Jeff Strabone said...

One word: laws?

12:25 AM, June 11, 2007

 
Anonymous blingbling said...

Two words: yes, laws.

6:49 AM, June 11, 2007

 
Blogger Jeff Strabone said...

Iraqi laws? The Iraqi constitution? These are the things you put your faith in? There is no rule of law in Iraq. The Iraqi government is not—here we go again—competent to enforce its constitution or its laws.

1:50 AM, June 13, 2007

 
Anonymous blingbling said...

Iraqi laws? The Iraqi constitution? These are the things you put your faith in?

Eh? I don't recall saying that I "put my faith" in anything. I was merely pointing out facts.

The Iraqi government is not—here we go again—competent to enforce its constitution or its laws.

Luckily it has the support of 140,000 or so US troops - not enough, of course, to ensure a general rule of law, but who cares, if it is at least enough to enforce the mandates for US "investment" in Iraqi oil on highly favourable terms. We shall see.

7:08 AM, June 13, 2007

 
Blogger Jeff Strabone said...

Right on cue, the front page of today's New York Times (June 13, 2007) has provided an update on the state of Iraqi legislation being used as benchmarks by the U.S.

Headline: 'Iraqis Are Failing to Meet Benchmarks Set by U.S.'

From the article:
'Iraq’s political leaders have failed to reach agreements on nearly every law that the Americans have demanded as benchmarks, despite heavy pressure from Congress, the White House and top military commanders. With only three months until progress reports are due in Washington, the deadlock has reached a point where many Iraqi and American officials now question whether any substantive laws will pass before the end of the year.
'Kurds have blocked a vote in Parliament on a new oil law. Shiite clerics have stymied an American-backed plan for reintegrating former Baathists into government. Sunnis are demanding that a constitutional review include more power for the next president.'

And that is hopefully all I have to say about this topic.

10:49 AM, June 13, 2007

 
Anonymous blingbling said...

Ah, unsourced speculation by anonymous "American and Iraqi officials" - is that what you put your faith in?

It is almost as if you want the US not to get their mitts on the oil, just so your thesis that Iraq has been a "failure", even a corporate-profiteering failure, notwithstanding the hundreds of billions of oil profits already made, will have a chance of standing up!

7:06 PM, June 13, 2007

 
Blogger Jeff Strabone said...

I don't need any officials, anonymous or otherwise, to tell me that an unpassed bill is not a law. I also don't need anyone to tell me that the Iraqi constitution is a document in disarray and with little to no bearing on Iraqis' experience of government.

You earlier said:
'Personally, I would be surprised at that: much US effort has been expended, and continues to be expended, in writing an Iraq constitution and set of laws precisely to make that impossible.'

There is no rule of law in Iraq. Its constitution and laws do not make much of anything possible or impossible. But even when it comes to forcing an incipient government, of little to no powers, to pass a U.S.-favorable law, we still see failure. The legislation that the U.S. seeks is only a bill, and even when or if it passes it can be repealed.

A better question might be: have Bush and Cheney, in their actions in Iraq, built the kinds of positive relationships and alliances with Iraqi actors that will lead to continued business after the occupation? Forget the growing Sunni hostilities for a moment: as of June 2007, does the U.S. even have any Shia allies and supporters in Iraq anymore? (I ask this a day after the minarets of the al-Askari masjid joined their dome in the rubble heap of Shia goodwill.)

Bush and Cheney have bungled their Iraqi operation so badly that no one should be surprised if the first post-occupation Iraqi government gives the U.S.—government and corporations alike—a big middle finger in energy and all other matters.

Yes, that is speculation. We will have to wait and see how much worse the situation gets. As in all things related to Bush and Cheney, I would love to be proven wrong.

10:26 PM, June 13, 2007

 

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