The Corporations,

Mutual Seduction,

Economic Invasion of Iraq

excerpted from the book

The Bush Agenda

Invading the World, One Economy at a Time

by Antonia Juhasz

HarperCollins, 2006, paper

p99

BECHTEL, CHEVRON, HALLIBURTON, AND LOCKHEED MARTIN

Corporate globalization continues as a model, despite the devastation it is known to cause, for one very simple reason: It works-only not in the way that its advocates promise. It has successfully restricted the ability of governments and communities all over the world to regulate the activities of multinational corporations. As a result, these companies have been freed to scour the globe in search of the cheapest locations to produce, the most abundant natural resources, and the most business-friendly governments. Under the theory of "what is good for corporations is good for everyone' laws the world over, including in the United States, have been rewritten specifically to benefit corporate growth and profit. The result is an unprecedented shift in global economic power from countries to corporations and a concurrent concentration of wealth in the hands of an ever-shrinking group of the ultra-wealthy and powerful.

In many ways, corporations have supplanted governments as the dominant economic force in the world. In 2002, corporations represented fifty-two of the hundred largest economies in the world. 2 The sales of the largest 200 corporations are growing faster than overall global economic activity. The largest corporations (by revenue) are heavily concentrated in the United States. According to Forbes magazine, in 2005, 75 of the 200 largest corporations were U.S. -based----more than the next three nations combined: Japan (28), France (21), and Germany (20)

... The reality is that the wealth being generated by the companies is locked firmly at the top. The rich are getting richer and the poor are not only getting poorer but are also increasing in number. In fact, since 1983, the only segment of the U.S. population that has experienced large wealth gains the richest 20 percent .

p100
Just compare CEO pay to that of the average worker. Twenty years ago, U.S. corporate CEOs earned on average forty-two times more than production workers. Today, they earn a whopping 431 times more.

p101
The 2005 UN Human Development Report found that the infant mortality rate in the United States is comparable to that in Malaysia country with a quarter the income. The UN report also found that infant death rates are higher for black children in Washing-" ton, DC, than for children in Kerala, India.

p101
The oil sector is prominently represented in both the Bush Agenda and the Bush administration. It is worth repeating that, for the first time in American history, the president, vice president, and secretary of state are all former energy company officials, and the only other U.S. president to come from the oil or energy business was George W. Bush's father. More specifically, both the president and vice president are former chief executives of Texas-based oil services companies with deep financial and political ties to the Middle East. Furthermore, both the president and secretary of state have more experience as oil executives than they do as public servants.

p102
Chevron, Halliburton, Lockheed martin, and Bechtel represent three key pillars of the Bush Agenda: oil, war, and building the infrastructure of corporate globalization.

p148
One constant in U.S. economic engagement with Iraq over the past twenty-five years has been the ability of U.S. corporations to influence U.S. policy to their own extreme benefit. In Iraq, many of these corporations helped to arm Hussein, lobbied for war against him, and are now profiting from his removal. In the 1990s and in the lead-up to and following the March 2003 invasion of Iraq, Bechtel, Chevron, Halliburton, and Lockheed Martin were part of a chorus of corporations desiring increased and more secure access to Iraqi profits. Their spokespeople began to advocate loudly for an invasion of Iraq and the ouster of Saddam Hussein.

p157
... until the 1991 Gulf War, the Reagan and Bush administrations were so driven to increase economic ties with [Saddam] Hussein that they were willing to ignore both his brutal human rights atrocities and his support for international terrorism-despite vocal concerns from within their own administrations. Reagan and Bush supplied money, arms, commercial products, and other forms of trade to Iraq. U.S. corporations, particularly through the efforts of the U.S.-Iraqi Business Forum and Kissinger Associates, worked aggressively to define and expand this relationship to their extreme benefit.

p158
in March 1982, Reagan removed Iraq from the list of countries supporting terrorism, which rendered Iraq eligible for a broader range of trade and credits with the United States. Then, on November 26, 1984, just days after his reelection, Reagan restored full diplomatic relations with Iraq. This move came under extreme influence from U.S. business interests but against the advice of many within Reagan's administration.

U.S. business interests played a leading role in persuading the Reagan administration to open economic engagement with Iraq, to resist calls for sanctions, and to ensure that the U.S. taxpayer bore much of

the economic risk. The business groups with the greatest influence were the U.S. -Iraq Business Forum and Kissinger Associates. These two groups used the power of their clients, and in the latter case, Henry Kissinger's personal influence, to ensure that U.S. economic policy toward Iraq would increasingly and consistently benefit both their own and their clients' bottom lines.

p162
Kissinger Associates

Henry Kissinger, April 20, 1986
I think that in the modern world, if you don't understand the relationship between economics and politics, you cannot be a great statesman. You cannot do it with foreign policy and security knowledge alone.

Can one possibly tell a story of American politics from the last forty years without reserving a prominent place for the august Henry Kissinger? Kissinger served simultaneously as President Nixon and then President Ford's national security adviser and secretary of state from 1973 to 1975. He began as Nixon's national security adviser in 1969 and then continued as Ford's secretary of state until 1977. Kissinger made his fame in government, but he continues to earn his fortune in business.

While the twin oil shocks of the 1970s were bad for consumers and most importer governments, they were good for former government officials. America's corporate executives learned the hard way that doing business overseas, particularly in the Middle East, required unique expertise. If they wanted access to all those petro-dollars in the hands of those state-controlled oil industries, they would need people with economic know-how and close relationships to government leaders. Kissinger's strength, as explained by Anthony J. F. O'Reilly of the Heinz Corporation in 1986, "is analyzing people and their power base. He has a durable and great inventory of contacts. To say that he is a door opener sounds mildly disparaging, but it is helpful in countries with rusty hinges."" Countryrisk.com, a website that reviews country analysis consultants, describes Kissinger Associates as "the company that started it all."

Kissinger founded the company in 1982, the same year that President Reagan opened economic ties with Iraq, and it remains one of the world's preeminent providers of advice and political risk assessments to the largest corporate-multinationals. It has also maintained its status as one of the most secretive businesses in the United States. Its customers are required to sign strict confidentiality agreements committing not to disclose their discussions with Kissinger Associates or even their status as Kissinger clients. In fact, Kissinger resigned from his appointment on the 9/11 Commission in 2002 in order to keep his client list secret. The company has no known website and, the most recent comprehensive interview conducted with Kissinger about his business was almost twenty years ago, with Leslie Geib of the New York Times in 1986.

Some information has found its way into the public domain, most notably during the 1989 Senate confirmation hearings of Lawrence Eagleburger to become undersecretary of state. Eagleburger, who served as president of Kissinger Associates from 1984 to 1989, told that committee that Kissinger clients typically pay a fixed annual fee for their top management to meet several times a year for discussions lasting a day or two on international political, economic, and security trends - ranging from Soviet affairs to the price of oil. An October 2004 press release by APCO Worldwide, announcing a "strategic alliance" with Kissinger Associates, says that the company "provides strategic advisory and advocacy services to a select group of multinational companies. The firm provides advice regarding special projects, assists its clients to identify strategic partners and investment opportunities, and advises clients on government relations throughout the world'

The names of a few Kissinger clients have leaked out over the years, including Hunt Oil, H.J. Heinz, Arco (now BP Oil), American Express, Shearson Lehman, Union Carbide, Coca-Cola, ITT Corp., and engineering giant Fluor, which, in 2004, became the recipient of the third largest reconstruction contract in Iraq, worth $3.75 billion.

p144
Though U.S. corporations desperately wanted to make a profit off of Iraq, they did not want to bear the risk. The U.S. -Iraq Business Forum and Kissinger Associates thus persuaded the Reagan administration to reverse a ban on U.S. commodity credits and loan guarantees to Iraq. This allowed the U.S. Export-Import Bank and the U.S. Overseas Private Investment Corporation (OPIC) to start making loans to Iraq. The Export-import Bank and OPIC are u.s. taxpayer-funded lending institutions that provide loans and credits either directly to U.S. corporations to help them operate abroad, or to foreign governments to help them purchase goods produced by U.S. companies. Both forms of lending were aggressively used to bring u.s. corporations and their goods into Iraq. U.S. taxpayers therefore bore a good deal of the financial cost of u.s. corporate activities with Iraq and Saddam Hussein.

p167
Arming Hussein

The Reagan administration and, to an even greater extent, the Bush Sr. administration, spent nearly a decade secretly arming Iraq through direct and indirect sales. The direct sales were of "dual-use" materials, which are goods ostensibly made for civilian purposes but have military applications as well. From 1985 to 1990, U.S. corporations provided $782 million in dual-use goods to Iraq. The Reagan and Bush Sr. administrations allowed the sales over the objections of the Pentagon, which believed these products would inevitably be used for military purposes. One government official explained that in March 1985, high technology export licenses, which previously had not been approved by the U.S. government to Iraq, "started to go through as if someone had suddenly turned a switch. The indirect method involved sales of conventional and chemical weapons to third parties, generally friendly governments, who then sold the weapons to Iraq.

U.S. arms dealers made out handsomely, as did dozens of U.S. multinational corporations, including Bechtel, AT&T, Hewlett Packard, General Motors, and Philip Morris ...

p169
In 1988, the State Department was again forced to release a public condemnation of the Iraqi government after Hussein used chemical weapons against the people of Halabja. The next day, the U.S. Senate passed a tough trade sanctions bill against Iraq that would have significantly curtailed U.S. corporate dealings with the country. But the Reagan administration, led by Secretary Shultz, lobbied vehemently against the sanctions, and they were not enacted.

p170
The end of the Iran-Iraq war in 1988 offered the newly elected Bush administration a fresh opportunity to alter U.S. relations with Iraq. Bush's transition team provided the president-elect with a policy memo on Iraq, which explained that "Saddam Hussein will continue to eliminate those he regards as a threat, torture those he believes have secrets to reveal, and rule without any real concessions to democracy." They argued that engagement was the appropriate response. The United States would have "to decide whether to treat Iraq as a distasteful dictatorship to be shunned where possible, or to recognize Iraq's present and potential power in the region and accord it relatively high priority. We strongly urge the latter view." Two reasons offered in the paper were Iraq's "vast oil reserves," which promised "a lucrative market for US goods," and the fact that U.S. oil imports from Iraq were skyrocketing.

Bush and Baker accepted the advice of the transition team and ran with it. On October 2, 1989, President Bush signed National Security Directive 26, which made explicit U.S. support for Iraq ...

p170
The British for their part, were wringing their hands with greed anticipation. According to Friedman, Iraq was known among British Foreign Secretary John Major's staff as "the big prize." Britain's senior Foreign Office officer wrote in October 1989, "I doubt if there is any future market on such a scale where the UK is potentially so well placed .... We must not allow it to go to the French, German, Japanese, etc. The priority of Iraq should be very high."

Meanwhile, the U.S. Congress had imposed U.S. Export-Import Bank financing restrictions on Iraq because of the Halabja massacre. On January 17, 1990, Bush voided the prohibition with a stroke of a pen, stating that it was "not in the national interest of the U.S." Baker then described trade as the "central factor in the U.S.-Iraq relationship." During the Bush-Baker tenure, the United States became Iraq's largest supplier of nonmilitary goods, and Iraq became the United States second biggest trading partner in the Middle East. In January 1990, the United States imported eight times more Iraqi oil than it had in 1987. By July 1990, U.S. imports had increased to 1.1 million barrels per day, more than a quarter of Iraq's total oil exports. As Baker would comment, U.S. policy toward Iraq was "not immune from domestic economic considerations, ""

At the same time, in the early months of 1990, Saddam Hussein turned up his anti-U.S. and anti-Israel rhetoric and actions, which included the public hanging of a British journalist of Iranian descent in Baghdad. In response, several Iraq sanctions bills were submitted in Congress, but every one was successfully fought off by Bush and Baker. Just two months before Hussein invaded Kuwait, on April 21, 1990, a U.S. delegation led by Senator Bob Dole was sent to Iraq in an attempt to placate Hussein. Baker personally sent a cable to the US embassy in Baghdad, instructing U.S. Ambassador to Iraq April Glaspie to meet with Hussein and to make it very clear that, "As concerned as we are about Iraq's chemical, nuclear, and missile programs, we are not in any sense preparing the way for a preemptive military unilateral effort to eliminate these programs."

p171
During the Iran-Iraq war, Hussein built the fourth largest military in the world with financial assistance from many nations, including Saudi Arabia. Hussein thought the money was aid in support for the war effort, but Saudi Arabia thought it was a loan and wanted its money back at the end of the war. Kuwait's oil was looking increasingly attractive, and its actions in OPEC, specifically overproduction that drove down the price of oil for all, were inciting Hussein's anger. In mid-July, Hussein amassed Iraqi troops on the Kuwait border and publicly threatened the use of military force. On July 25, U.S. Ambassador Glaspie was once again dispatched to meet with Hussein. This time, the message she delivered to him would become infamous: have direct instruction from the President to seek better relations with Iraq" and "we have no opinion on the Arab-Arab conflicts like your border disagreement with Kuwait."

Less well known is the personal cable sent a few days later from President Bush to Hussein, just five days before the invasion of Kuwait, in which Bush expressed concern but added, "Let me reassure you that my administration continues to desire better relations with Iraq."

At 9:00 P.M. on August 1, 1990, Iraqi forces crossed into Kuwait. On August 15 President Bush declared, "Our jobs, our way of life, our freedom, and the freedom of friendly countries around the world would all suffer if control of the world's great oil reserves fell into the hands of Saddam Hussein." To this Secretary Baker added, "The economic lifeline of the industrial world runs from the Gulf and we cannot permit a dictator such as this to sit astride that economic lifeline."° On January 15,1991, the day before the United States launched attacks against Iraq, President Bush signed National Security Directive 54. The first line states, "Access to Persian Gulf oil and the security of key friendly states in t e area are vital to U.S. national security. . . The US. remains committed to defending its vital interests in the region, it necessary through use of military force, against any power with interests inimical to our own." By March 3, the first Gulf War was over. The Iraqi army was successfully expelled from Kuwait, while Saddam Hussein remained in power in Iraq.

There are two main schools of thought as to why the United States did not stop the invasion of Kuwait before it began. The first is that Bush truly was caught off guard. Bush believed he and Hussein were working together, but Hussein had to make a show of aggression to impress both those in and outside of Iraq of his seriousness Bush did not actually believe that Hussein would invade Kuwait in defiance of U.S. interests (even if those interests had not been stated) and those of most of Iraq's neighbors, and Hussein did not actually believe that Bush would stop him if he did invade. But once Hussein invaded Kuwait, the Bush administration could not allow him to control both his own and Kuwait's oil and threaten Saudi Arabia, particularly since he had demonstrated that he was no longer to be trusted in serving U.S. interests. Hussein had to be removed.

p173
... Bush allowed Hussein to invade Kuwait because it provided an excuse to remove Hussein from power, and the war with Iraq, in turn, provided the necessary excuse to bring a significantly increased U.S. military presence into the region-including five hundred thousand U.S. troops in Saudi Arabia. The U.S. military presence not only remained but also spread to more countries and grew dramatically with the second U.S. war against Iraq.

... Dick Cheney in April 1991
"Once you've got Baghdad, it's not clear what you do with it. It's not clear what kind of government you would put in place of the one that's currently there .... How much credibility is that government going to have if its set up by the U.S. military when its there? ... I think to have American military engaged in a civil war inside Iraq would fit the definition of a quagmire, and we [have absolutely no desire to get bogged down in that fashion."

Paul Wolfowitz Bush Sr.'s undersecretary of defense policy
"A new regime [in Iraq] would have become the United States' responsibility. Conceivably, this could have led the United States into a more or less permanent occupation of a country that could not govern itself, but where the rules of foreign occupier would be increasingly resented."

p174
SANCTIONS

The attempt to oust Hussein took the form of full economic sanctions against Iraq, imposed by the United States and the UN Security Council. Implemented just five days after the invasion of Kuwait, the sanctions amounted to an almost complete economic embargo of the nation, with deadly effects. The World Health Organization found that compared to two years prior to the war, infant mortality rates from 1989 to 1994 had doubled, and the mortality rate for children under five increased by six times. UNICEF reported that from 1991 to 1998, some half a million children under the age of five died in "excess" of the number expected to die without sanctions.

p175
In a report to the U.S. Congress in October 2004, Charles Duelfer, the U.S. arms investigator in Iraq at the time of the 2003 invasion, reported that Hussein had established a worldwide network of companies and countries, most of them U.S. allies, which secretly helped Iraq generate about $11 billion in illegal income from oil sales under the Oil-for-Food Program.

p175
Between the first half of 1997 and the summer of 2000, while Cheney was Halliburton's CEO, Halliburton subsidiaries Dresser-Rand and Ingersoll Dresser Pump Co. sold water and sewage treatment pumps, spare parts for oil facilities, and pipeline equipment to Iraq through French affiliates. Halliburton ultimately sold more than $73 million in goods and services to Saddam Hussein's regime. 16 In fact, the Financial Times reported that Halliburton sold more oil industry products to Hussein than any other U.S. company.

p176
... for many U.S. corporations, the presidency of Bill Clinton provided many new "free trade" opportunities, including the 1994 North American Free Trade Agreement, the 1995 World Trade Organization, ongoing negotiations for a Free Trade Area of the Americas, expanded trade with China, and the proposed Multilateral Agreement on Investment. Clinton was backed by the Republican-led Congress, which whole-heartedly endorsed each new free trade agreement.

p180
former Joint Chief of Staff Admiral William J Crowe told Cohn Powell
"First, to be a great President you have to have a war. All the great Presidents have had their wars. Two, you have to find a war where you are attacked."

p181
The Committee for the Liberation of Iraq (CLI) ... was founded in 2002 and can be viewed as an extension of the Project for the New American Century.

... "The Committee existed to mobilize U.S. and international support to end Saddam's regime and to work "beyond the liberation of Iraq to the reconstruction of its economy and the establishment of political pluralism, democratic institutions, and the rule of law." This last sentence provides the CLI proposal for what would differentiate the current Bush administration from the last. Whereas the former President Bush was seeking merely to replace Hussein with a more U.S.-friendly Iraqi leader, George W. Bush would replace Hussein, his economy, his government, and his laws.

p182
Committee members did more than profit from the war. They played a lead role in carrying the United States into war in the first place. They influenced public opinion through articles in the nation's leading newspapers, appearances on television and radio talk shows, and public speeches. Perhaps the clearest public articulation of the Committee's opinion, and ultimately that of the administration, was expressed by Ronald Reagan's former secretary of state, George Shultz. In an essay published in the Washington Post on September 7, 2002, under the headline, "ACT NOW The danger is immediate. Saddam Hussein must be removed," Shultz laid out the most influential arguments for war, which have since been proven to have the least basis in fact. According to Shultz, the most compelling argument for war was the catastrophic and immediate threat posed to the United States by Hussein's weapons of mass destruction and his links to terror. Shultz writes:

Self-defense is a valid basis for preemptive action. The evidence is clear that Hussein continues to amass weapons of mass destruction. He has also demonstrated a willingness to use them against internal as well as external targets. By now, the risks of inaction clearly outweigh the risks of action. If there is a rattlesnake in the yard, you don't wait for it to strike before you take action in self-defense. The danger is immediate. The making of weapons of mass destruction grows increasingly difficult to counter with each passing day. When the risk is not hundreds of people killed in a conventional attack but tens or hundreds of thousands killed by chemical, biological or nuclear attack, the time factor is even more compelling.

Shultz then argued that Iraq is "a major source of and support for terror and instability," and that by taking Hussein out, "a model can emerge that other Arab societies may look to and emulate for their own transformation and that of the entire region." Few people reading these words, written by a former U.S. secretary of state and respected scholar, published in one of the world's most prominent newspapers, would feel anything less than terrified. What Shultz fails to mention in this essay is his long-standing positions at Bechtel and the company's role in providing Hussein with the means to produce chemical weapons. He also fails to mention his personal role throughout the 1980s as a courtier to Hussein. In describing Hussein writes, "No other dictator today matches his record of war, oppression, use of weapons of mass destruction and continuing contemptuous violation of international law." And yet, for ( more than a decade, Shultz, Bush the first, Reagan, Baker, Cheney, Wolfowitz, Rumsfeld, Kissinger, Eagleburger, and other U.S. corporate / and government CEOs were content to supply this very same dictator with weapons, money, goods, and services.

p184
Not only would the George W. Bush administration invade Iraq, it would fundamentally remake its internal government and policy-making structure such that the new country would serve U.S. interests. The corporations would gain access to the world's second largest oil supply and all of the wealth it generates, and the politicians would have their "new Iran"-a regional ally from which to protect Israel and guarantee U.S. access and hegemony over the entire region as well as much of the world.

p185
THE ECONOMIC INVASION OF IRAQ

Michael Scheuer, former senior CIA al-Qaeda expert and author, Imperial Hubris'

The U.S. invasion of Iraq was not preemption; it was-like our war on Mexico in 1846-an avaricious, premeditated, unprovoked war against a foe who posed no immediate threat but whose defeat did offer economic advantages.

p185
Imagine that the United States is currently under a foreign military occupation. The foreign occupiers have thrown out the Constitution, the Amendments to the Constitution, and the Bill of Rights. They have actively and publicly participated in the writing of a new constitution to replace all three. There will be a popular vote on the new constitution, although its contents have not been made public and our elected officials have not seen the final version. Some of the contents have been leaked in the press, but the leaks are contradictory. Three days before the vote, a small handful of leaders-not all elected and at least one who represents the foreign occupier-meet and make changes to the constitution. That same day, a paper copy written several weeks earlier is made available to the public. However, there are only enough copies for less than one-third of eligible voters. Few legal experts have read or analyzed it, so those voters lucky enough to get a copy must decipher its meaning on their own. Political and religious leaders who feel some confidence about the larger points of the constitution advise their followers how to vote based on their limited knowledge. You know it is a critical vote that will impact every aspect of your life, so you go to the polls and cast your ballot.

This was the situation faced by the Iraqi public when, on October 15, 2005, 9.8 million people voted in a national referendum on a new Constitution for Iraq.

... few Iraqis could have known that the constitution they endorsed locked in the most crucial aspects of the Bush Agenda in Iraq: the military occupation, the economic invasion, and increased U.S. access to Iraq's oil.

p187
Five days later President Bush named L. Paul Bremer III presidential envoy to Iraq and the administrator of the U.S.-led occupation government, the Coalition Provisional Authority (CPA). During the next fourteen months, considered the period of formal U.S. occupation, Bremer enacted new laws with full legal force over Iraqis, all but a handful of which remain in effect today. These laws have gone virtually unnoticed and unreported in the United States, yet they go to the heart of the Bush Agenda. They lock in sweeping advantages to U.S. corporations, ensuring long-term U.S. economic gain while guaranteeing few, if any, benefits to the Iraqi people. In fact, they have set in place conditions for the ongoing inadequate provision of basic services, unemployment, underdevelopment, economic inequality, and violence for the foreseeable future.

p211
ORDER #39: FOREIGN INVESTMENT

Foreign investment rules have been the cherry on top of the corporate globalization pie for decades. They have long been widely sought after but rarely achieved. It was the adamant opposition of developing country governments to these same laws that contributed significantly to the collapse of WTO talks in Seattle in 1999 and again in Cancun in 2003. To avoid another collapse, the provisions were removed altogether from the agenda of the WTO's 2005 Hong Kong ministerial. Foreign investment provisions continue to be one of the most controversial elements of the North American Free Trade Agreement (NAFTA) between the United States, Mexico, and Canada. Global opposition to these laws led to the defeat of the Multilateral Agreement on Investment. In Iraq, however, there was no opposition to overcome. Bremer simply put the foreign investment provisions into force with the stroke of a pen.

Order #39 (September 19, 2003) is the foreign investment Order." It includes the following provisions: (1) privatization of Iraq's state-owned enterprises; (2) 100 percent foreign ownership of Iraqi businesses; (3) "national treatment"-which means no preferences for local over foreign businesses, which has allowed for a U.S. corporate invasion of Iraq; (4) unrestricted, tax-free remittance of all profits and other funds; (5) forty-year ownership licenses; and (6) the right to take legal disputes out of Iraq's courts and into international tribunals. More than any other Order, it fully embodies the Bush Agenda in Iraq: the creation of a U.S. corporate haven that will act as a model and jumping-off point for the rest of the region.

p213
Paul Bremer, November 2001
"Privatization of basic services,& example, almost always leads to price increases for those services, which in turn often lead to protests or even physical violence against the operator."

p240
..."free trade" is a misnomer for trade policies that are heavily regulated to favor multinational corporations ...

The Bush Agenda

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