[A-List] Iraq: the vultures swoop

["Michael Keaney" <michael.keaney@xxxxxx>]

Corporations have eyes on the prize

Washington diary Julian Borger

Julian Borger

Two weeks after the fall of Baghdad, the Iraqi people are not sure what to
make of liberation. They are rid of Saddam Hussein but apprehensive about
who will replace him amid the postwar chaos. The US military has scored an
overwhelming victory with minimal casualties, but is now facing a marathon
of "nation-building" on behalf of an increasingly hostile population.So far,
the undisputed winners from the war are to be found in America's corporate
boardrooms. Halliburton, Vice President Dick Cheney's old company, had
already clinched the contracts for extinguishing oil fires before the
fighting started. Its subsidiary, Kellogg, Brown & Root, can also expect
long-term deals to build and supply the US's garrisons in Iraq.

There is only one bigger winner than Halliburton so far, and that is
Bechtel, another corporation that has traditionally financed and staffed a
string of Republican administrations. The San Francisco-based firm was last
week awarded the first $34m of a $680m contract to rebuild Iraq's wrecked
infrastructure. Bechtel and Halliburton now have a headstart in the race to
secure future business as the US spends up to $10bn in taxpayers' money and
Iraqi oil revenue to get the country on its feet.

The 18-month Bechtel deal contains provisions that pave the way for it to
take a role in repairing airports, dredging and restoring the Umm Qasr port,
rebuilding hospitals, schools, government ministries and irrigation systems
and restoring transport links, according to the US Agency for International
Development, which awarded the contract.
The reconstruction tender had been limited to a handful of US companies
trusted by Washington, so the  winner was always going to be open to
accusations of cronyism, but Bechtel is a supreme insider. It provided the
Reagan administration with two of its leading lights - George Shultz and
Casper Weinberger. Its current vice president, Jack Sheehan, sits on the
Defence Policy Board, advising the Pentagon, and the firm's chairman, Riley
Bechtel, has been appointed to President Bush's Export Council. But Bechtel
also knows Iraq extremely well. In fact, much of Iraq's recent history has
been intertwined with the company's. It has been operating there since the
1950s, and by 1983 it was attempting to persuade Saddam to build a
billion-dollar oil pipeline to the Red Sea port of Aqaba, in Jordan.
Bechtel had a formidable array of lobbying muscle behind it. Shultz, its
former chief executive was Reagan's secretary of state, and Weinberger, who
had been its top corporate lawyer, was secretary of defence. More
importantly, Bechtel had the good offices of Reagan's special envoy to the
Middle East, Donald Rumsfeld.

Rumsfeld flew to Iraq in 1983 to meet Saddam and the deputy prime minister,
Tariq Aziz. The Iraq-Iran war was burning through the region, and the state
department was well aware that Saddam was using chemical weapons every day
against his enemies. But Rumsfeld had not come to talk about that. His twin
missions were re-establishing full diplomatic relations between the US and
Iraq, and negotiating a closely connected commercial matter - the
billion-dollar Bechtel pipeline.

The various cables and memoranda from the Rumsfeld trip and its relations to
Bechtel are now available,  having been declassified and published by the
watchdog group, the Institute for Policy Studies, in a report aptly titled
Crude Vision.

One secret state department cable from the time reads: "In response to
Rumsfeld's interest in seeing Iraq increase oil exports, including through
possible new pipeline across Jordan to Aqaba, Saddam suggested Israeli
threat to security of such a line was major concern and US might be able to
provide some assurances in this regard."
Rumsfeld was happy to oblige, and the machinery of the Reagan government
went about seeking such guarantees from the Israelis.

In the end Saddam decided against building the pipeline. It probably made no
economic sense. But now he is gone, his statues have fallen, and Bechtel is
back - and so is Rumsfeld. He is now appealing for tips on where Iraq's
weapons of mass destruction might be concealed, but 20 years ago he need not
have gone to  the trouble. He was shaking hands and grinning with the man
who not only knew where they were, but was using them.

For those who see a giant corporate-led conspiracy behind the Iraq war, the
Bechtel papers come close to a smoking gun. But outcomes do not always
explain motivation. Every administration is driven most of all by the
imperative of getting re-elected. Doing favours for corporations helps when
it comes time for fundraising, but Bechtel's contributions (more than $1m
over the past three years) can more or less be taken for granted by the
Republican party. It does not have to invade a large Middle Eastern state,
with all the political risks that that entails, in order to ensure that
petrochemical dollars continue to flow into its coffers.

The road to Baghdad was not that straight, and it ran through September 11.
The fear of more devastating attacks, with weapons of mass destruction next
time, combined  with a predilection to go after Iraq because of unfinished
business from the last Gulf war, and strategic interests in maintaining the
region's supply of oil, to produce the war.

However, now that the war is over the siren call of campaign contributions
holds more exclusive sway. If the United Nations was given a say in Iraq's
reconstruction, it would go a long way towards legitimising the liberation
in the eyes of ordinary Iraqis and healing the rift with the Arab world and
Europe.

It would also clear the way for relief organisations to work alongside the
reconstruction effort. But it would mean surrendering the US monopoly on
contracts.

Given such a dilemma, the presidential decision is not in doubt. In Iraq, as
at home in the US, when Bush is given a choice between taking the visionary
and conciliatory path, or choosing the road to corporate profit and
short-term political gain, he can be counted on to choose the latter.

The Guardian Weekly 20-3-0424, page 6