"Bush's Iraq: An Appointocracy"

Naomi Klein reports:

'The people of Iraq are free," declared U.S. President George W. Bush in Tuesday's State of the Union address. The day before, 100,000 Iraqis begged to differ. They took to the streets of Baghdad shouting "Yes, yes to elections. No, no to selection."

According to Iraq occupation chief Paul Bremer, there really is no difference between the White House's version of freedom, and the one being demanded on the street. Asked on Friday whether his plan to form an Iraqi government through appointed caucuses was headed toward a clash with Ayatollah Ali al-Sistani's call for direct elections, Mr. Bremer said he had no "fundamental disagreement with him."

It was, he said, a mere quibble over details. "I don't want to go into the technical details of refinements. There are, if you talk to experts in these matters, all kinds of ways to organize partial elections and caucuses. And I'm not an election expert, so I don't want to go into the details. But we've always said we're willing to consider refinements."

I'm not an election expert either, but I'm pretty sure there are differences here than cannot be refined. Ayatollah al-Sistani's supporters want every Iraqi to have a vote, and for the people they elect to write the laws of the country -- your basic, imperfect, representative democracy.

Mr. Bremer wants his Coalition Provisional Authority (CPA) to appoint the members of 18 regional organizing committees. The committees will then select delegates to form 18 selection caucuses. These selected delegates will then further select representatives to a transitional national assembly. The assembly will have an internal vote to select an executive and ministers who will form the new government of Iraq. That, Bush said in his address, constitutes "a transition to full Iraqi sovereignty."

Got that? Iraqi sovereignty will be established by appointees appointing appointees to select appointees to select appointees. Add to that the fact that Mr. Bremer was appointed to his post by President Bush and that Mr. Bush was appointed to his by the U.S. Supreme Court, and you have the glorious new democratic tradition of the appointocracy: rule by appointee's appointee's appointees' appointees' appointees' selectees.

The White House insists that its aversion to elections is purely practical: there just isn't time to pull them off before the June 30 deadline. So why have the deadline? The most common explanation is that Bush needs "a braggable" on the campaign trail: When his Democratic rival raises the specter of Vietnam, Mr. Bush will reply that the occupation is over, we're on our way out.

Except that the United States has absolutely no intention of actually getting out of Iraq. It wants its troops to remain, and it wants Bechtel, MCI and Halliburton to stay behind and run the water system, the phones and the oil fields. It was with this goal in mind that, on Sept. 19, Mr. Bremer pushed through a package of sweeping economic reforms that The Economist described as a "capitalist dream."

But the dream, though still alive, is now in peril. A growing number of legal experts are challenging the legitimacy of Mr. Bremer's reforms, arguing that under the international laws that govern occupying powers -- the Hague Regulations of 1907 and the 1949 Geneva Conventions -- the CPA can only act as a caretaker of Iraq's economic assets, not as its auctioneer. Radical changes such as Mr. Bremer's Order 39, which opened up Iraqi industry to 100 per cent foreign ownership, violate these laws and could therefore be easily overturned by a sovereign Iraqi government.

That prospect has foreign investors seriously spooked, and many are opting not to go into Iraq. The major private insurance brokers are also sitting it out, having assessed Iraq as too great an expropriation risk. Mr. Bremer has responded by quietly canceling his announced plan to privatize Iraq's 200 state firms, instead putting up 35 companies for lease (with a later option to buy). For the White House, the only way for its grand economic plan to continue is for its military occupation to end: only a sovereign Iraqi government, unbound by the Hague and Geneva Regulations, can legally sell off Iraq's assets.

But will it? Given the widespread perception that the United States is not out to rebuild Iraq but to loot it, if Iraqis were given the chance to vote tomorrow, they could well immediately decide to expel U.S. troops and to reverse Mr. Bremer's privatization project, opting instead to protect local jobs. And that frightening prospect -- far more than the absence of a census -- explains why the White House is fighting so hard for its appointocracy.

Under the current U.S. plan for Iraq, the transitional national assembly would hold onto power from June 30 until general elections are held no later than Dec. 31, 2005. That's 17 leisurely months for a non-elected government to do what the CPA could not legally do on its own: invite U.S. troops to stay indefinitely and turn Mr. Bremer's capitalist dream into binding law. Only after these key decisions have been made will Iraqis be invited to have their say. The White House calls this self-rule. It is, in fact, the very definition of outside-rule, occupation through outsourcing.

That means that the world is once again facing a choice about Iraq. Will its democracy emerge stillborn, with foreign troops dug in on its territory, multinationals locked into multiyear contracts controlling key resources, and an entrenched economic program that has already left 60-70 per cent of the population unemployed? Or will its democracy be born with its heart still beating, capable of building the country Iraqis choose?

On one side are the occupation forces. On the other are growing movements demanding economic and voter rights in Iraq. Increasingly, occupying forces are responding to these movements by using fatal force to break up demonstrations, as British soldiers did in Amarah earlier this month, killing six. Yes, there are religious fundamentalists and Saddam loyalists capitalizing on the rage in Iraq, but the very existence of these pro-democracy movements is itself a kind of miracle: After 30 years of dictatorship, war, sanctions and, now, occupation, it would certainly be understandable if Iraqis met further hardships with fatalism and resignation. Instead, the violence of Mr. Bremer's shock therapy appears to have jolted tens of thousands into action.

Their courage deserves our support. Last week, at the World Social Forum in Mumbai, India, author and activist Arundhati Roy called on the global forces that opposed the Iraq war to "become the global resistance to the occupation." She suggested choosing "two of the major corporations that are profiting from the destruction of Iraq" and targeting them for boycotts and civil disobedience.

In his State of the Union address, President Bush said, "I believe that God has planted in every heart the desire to live in freedom. And even when that desire is crushed by tyranny for decades, it will rise again." He is being proven right in Iraq every day -- and the rising voices are chanting, "No, no U.S.A. Yes, yes elections."

The Battle for Iraqi Oil

In The Nation, Aram Roston reports:
David Horgan opposed the war on Iraq, but in other ways he is an antiwar protester's worst nightmare: The oil executive freely admits that he is in the bombed-out country "for greed and glory." His goal is a mammoth oil deal for the small Irish company he works for, Petrel Resources. Still, amid the shooting and kidnappings and chaos, the wiry 43-year-old Irishman says he will be satisfied with even crumbs. "A crumb in Iraq," he says eagerly, eyes widening, "would be hundreds of millions of dollars at present value. It is high risk, in every sense, but it is an excellent play."

Horgan is no newcomer to Iraq and to this particular "play." He dealt with the administration of Saddam Hussein and he is willing to do business with whoever comes next, even a US puppet, as he believes it will be. "We'll deal with the puppet," he said one day at the Baghdad Sheraton, as a group of Nepalese Gurkha warriors clomped past loaded with body armor and rifles. "Any puppet will have exactly the same objectives and worries. His first priority is to get the oil flowing." That may sound cynical, but at least it sounds honest--which is more, as Horgan points out, than the Bush Administration can say about its justification for invading Iraq.

A little time with Horgan in Baghdad opens up a window on one of the most important but confusing elements of postwar Iraq: the upcoming battle for control of its vast oil reserves. Before the war, US Defense Secretary Donald Rumsfeld famously announced that this war had "literally nothing to do with oil," while antiwar protesters chanted "no blood for oil," in the streets. Since then there has been very much blood, and surprisingly little oil. New exploration of Iraq's untapped fields is at a virtual standstill; the repair of the old fields has been notoriously slow. A little-known statistic: According to international oil traders, the United States is currently importing 500,000 barrels of Iraqi oil per day (a type of oil charmingly called "Basrah Light"), down from more than 700,000 per day last February, before the war started. I caught up with Horgan one day outside the Iraqi Oil Ministry. He was dressed in a gray suit that flapped in the dry hot wind. More and more, amid the chaos, power over oil seems to be slipping back into the hands of the Iraqi bureaucracy. The ministry is an eleven-story edifice of the typical squat Stalinist design, the color of desert dirt. The place is bristling with coils of razor wire slung like giant slinkies, and a machine-gun bunker protected by sandbags is set on each side of the entrance. Inside it has the bustling ambience of a run-down betting parlor. Most maps and contracts are off-limits, and mustached bodyguards lounge about on the plush executive floor, with pistols of various makes and calibers in their belts.

But there are rarities here, tidbits of information that would make an oilman's nose twitch. The well-lit library is full of dusty tomes with titles like The Sedementology of the Euphrates Formation and Floraminera and Biostratratology of Some Late Cretacean Sediment of Northern Iraq. That day Horgan was dropping off a series of seismic readings he had carried back with him to Ireland from the last visit, and he was picking up some large-scale maps, which, he said, "had heretofore been military secrets, believe it or not."

Perhaps Horgan finds it easy to do business in Iraq because the bombed-out buildings of Baghdad and the nightly shootings and explosions are somewhat reminiscent of the Belfast of his youth. He and the other children would throw rocks at the British soldiers, he said. "Sometimes they'd charge at you in the armored vehicles and scatter the kids." In 1999, Horgan and other Petrel executives made their first visit to Baghdad, where they joined the herd of international companies tugging at Saddam Hussein's sleeve. Sure, UN sanctions were in place, but companies were jostling for position when the walls eventually would come tumbling down. The Iraqis were glad to talk. "More than eighty-five companies were negotiating with us at that time," recalled Ali Hammadi, an executive at the Iraqi Oil Ministry. In an interview, he dressed in a well-ironed blue shirt and sat behind an expansive wooden desk. Through the window was a view of the sprawling derelict Iraqi Olympic compound once headed by Saddam Hussein's son Uday. "We had plans, tremendous plans," Hammadi said, waving his hand to show the size. Hammadi has a cosmopolitan air and wears tinted glasses. "I negotiated with Russians, Italians, Germans and Canadians." Even American firms pursued their prospects, through European interests, as did the Chinese, the Indonesians and the Indians.

Ali Hammadi says many of the shoppers in this international oil bazaar were interested in a vast region known only as the "Western Desert"--inhabited by nomadic tribesman and virtually unexplored. The Western Desert is what one international oil consultant, his voice mockingly falling to a worshipful murmur, called the "Holy Grail" of the oil industry. Iraqi oil is miraculously cheap to pump out of the ground, costing about a dollar a barrel. Iraqis in general seem to have a touch of pride about their oil. "It comes up to the ground," one man told me, smiling. "I've seen it seeping up." Another one laughed one day: "You put a pipe in the ground and oil comes out." The chief wells are to the North, near Kirkuk, where sabotage keeps production down, and to the South, near Basra. But the Western Desert offers untold riches. Horgan says Petrel Resources reached an agreement under Saddam to explore a chunk of the Western Desert known as Block 6. It was, he says, signed by a high-ranking Iraqi official, although, crucially, it was not ratified by Saddam Hussein. "We think it's a valid agreement," he insists.

Iraq's current American rulers are studiously noncommittal about contracts signed under Saddam. For to understand Iraqi oil development, it's clear that there is not just the one Iraqi Oil Ministry but a parallel "shadow" ministry run by American advisers. To get to the Coalition Provisional Authority's shadow ministry of oil requires a trip to the "Green Zone"--a giant sprawl smack in the middle of Baghdad. Here, one would have no idea that Iraq is populated by Iraqis. At the perimeter, an Iraqi man manages to wander through toting a shopping bag with bootleg pornographic DVDs for sale, but on this compound air-conditioned minibuses take US contractors and soldiers and civilian government officials to their work sites. There is a three-mile running track, a swimming pool, a fitness center, even a barber shop and beauty salon run by Halliburton's Kellogg Brown & Root. And deep inside Saddam Hussein's former palace, where the top coalition supervisors have burrowed in, is the bustling air-conditioned office where the American advisers run their oil operation. They are on personal-services contracts, like hockey players who have signed to a team. One man, who spoke on condition of anonymity, dismissed Horgan's claims of an agreement with a shake of his head. "A lot of people believe they have agreements," he said. Which is to say, in reality, that no one knows what will happen to the deals made before the invasion. The CPA says that any contract that violated the old UN rules is illegal, but that leaves a lot of wiggle room.

David Horgan doesn't care what the coalition thinks in any case. "The weird thing is," he said, "the CPA, they have no clue. They never go anywhere. They never go out. We ignore them. Why would we even talk to the coalition?" He has never ventured into the Green Zone. Much of the world thought the war would result in a flurry of business activity, with the world's oil giants sweeping through Iraq like a killer whale through a school of fat salmon. That didn't happen. One reason is that it's probably the most dangerous place in the world for an oil executive right now. The Exxons and the Shells and BPs don't want to deal with the physical risk to their executives. In the barricaded hotels that house expatriates there are a swarm of former Gurkhas, French Foreign Legionnaires and Special Forces veterans trained in every army between New Zealand to the Netherlands. Still, the supply doesn't meet the threat. Horgan is one of the few Western oilmen to be found in Iraq, and he shuns the security guards, whom he dismisses as goons and mercenaries. "They're going to draw attention to you. The best thing is just to use humor, make eye contact with people, smile at them."

Horgan's happy theory is that the rebels who have been attacking US troops and their allies use discretion: "The working assumption is that there's some sort of discipline and control over these rebels and they distinguish between friendly neutrals and coalition nationals." He nodded, "That's our working assumption."

But an even more significant reason the big boys from the oil industry are staying clear is the legal black hole into which they'd be stepping. After all, until there is a legitimate sovereign government in Iraq, it is unclear whether any new long-term oil exploration deals will stand. As one American attached to Paul Bremer's shadow ministry told me one day, "We're not a legitimate government." That means most of that untouched oil underneath the desert sand is off-limits--and all the oil giants can only stare, like alcoholics looking at liquor bottles in a shuttered shop. No one, at present, has the shop keys.

"Iraq is not America's to sell"

International law is unequivocal - Paul Bremer's economic reforms are illegal

Naomi Klein, in The Guardian, reports:

Bring Halliburton home. Cancel the contracts. Ditch the deals. Rip up the rules. Those are just a few of the suggestions for slogans that could help unify the growing movement against the occupation of Iraq. So far, activist debates have focused on whether the demand should be for a complete withdrawal of troops, or for the United States to cede power to the United Nations.

But the "troops out" debate overlooks an important fact. If every last soldier pulled out of the Gulf tomorrow and a sovereign government came to power, Iraq would still be occupied: by laws written in the interest of another country; by foreign corporations controlling its essential services; by 70% unemployment sparked by public sector layoffs.

Any movement serious about Iraqi self-determination must call not only for an end to Iraq's military occupation, but to its economic colonisation as well. That means reversing the shock therapy reforms that US occupation chief Paul Bremer has fraudulently passed off as "reconstruction", and cancelling all privatisation contracts that are flowing from these reforms.

How can such an ambitious goal be achieved? Easy: by showing that Bremer's reforms were illegal to begin with. They clearly violate the international convention governing the behaviour of occupying forces, the Hague regulations of 1907 (the companion to the 1949 Geneva conventions, both ratified by the United States), as well as the US army's own code of war.

The Hague regulations state that an occupying power must respect "unless absolutely prevented, the laws in force in the country". The coalition provisional authority has shredded that simple rule with gleeful defiance. Iraq's constitution outlaws the privatisation of key state assets, and it bars foreigners from owning Iraqi firms. No plausible argument can be made that the CPA was "absolutely prevented" from respecting those laws, and yet two months ago, the CPA overturned them unilaterally.

On September 19, Bremer enacted the now infamous Order 39. It announced that 200 Iraqi state companies would be privatised; decreed that foreign firms can retain 100% ownership of Iraqi banks, mines and factories; and allowed these firms to move 100% of their profits out of Iraq. The Economist declared the new rules a "capitalist dream".

Order 39 violated the Hague regulations in other ways as well. The convention states that occupying powers "shall be regarded only as administrator and usufructuary of public buildings, real estate, forests and agricultural estates belonging to the hostile state, and situated in the occupied country. It must safeguard the capital of these properties, and administer them in accordance with the rules of usufruct."

Bouvier's Law Dictionary defines "usufruct" (possibly the ugliest word in the English language) as an arrangement that grants one party the right to use and derive benefit from another's property "without altering the substance of the thing". Put more simply, if you are a housesitter, you can eat the food in the fridge, but you can't sell the house and turn it into condos. And yet that is just what Bremer is doing: what could more substantially alter "the substance" of a public asset than to turn it into a private one?

In case the CPA was still unclear on this detail, the US army's Law of Land Warfare states that "the occupant does not have the right of sale or unqualified use of [non-military] property". This is pretty straightforward: bombing something does not give you the right to sell it. There is every indication that the CPA is well aware of the lawlessness of its privatisation scheme. In a leaked memo written on March 26, the British attorney general, Lord Goldsmith, warned Tony Blair that "the imposition of major structural economic reforms would not be authorised by international law".

So far, most of the controversy surrounding Iraq's reconstruction has focused on the waste and corruption in the awarding of contracts. This badly misses the scope of the violation: even if the sell-off of Iraq were conducted with full transparency and open bidding, it would still be illegal for the simple reason that Iraq is not America's to sell.

The security council's recognition of the United States' and Britain's occupation authority provides no legal cover. The UN resolution passed in May specifically required the occupying powers to "comply fully with their obligations under international law including in particular the Geneva conventions of 1949 and the Hague regulations of 1907".

According to a growing number of international legal experts, that means that if the next Iraqi government decides it doesn't want to be a wholly owned subsidiary of Bechtel and Halliburton, it will have powerful legal grounds to renationalise assets that were privatised under CPA edicts.

Juliet Blanch, global head of energy and international arbitration for the huge international law firm Norton Rose, says that because Bremer's reforms directly contradict Iraq's constitution, they are "in breach of international law and are likely not enforceable". Blanch argues that the CPA "has no authority or ability to sign those [privatisation] contracts", and that a sovereign Iraqi government would have "quite a serious argument for renationalisation without paying compensation". Firms facing this type of expropriation would, according to Blanch, have "no legal remedy".

The only way out for the administration is to make sure that Iraq's next government is anything but sovereign. It must be pliant enough to ratify the CPA's illegal laws, which will then be celebrated as the happy marriage of free markets and free people. Once that happens, it will be too late: the contracts will be locked in, the deals done and the occupation of Iraq permanent.

Which is why anti-war forces must use this fast-closing window to demand that the next Iraqi government be free from the shackles of these reforms. It's too late to stop the war, but it's not too late to deny Iraq's invaders the myriad economic prizes they went to war to collect in the first place.

It's not too late to cancel the contracts and ditch the deals.

"Why The Privatization of Iraq is Illegal"

Aaron Mate on "What the US-UK's responsibilities are as occupier of Iraq":

On May 22 2003, the United Nations Security Council passed Resolution 1483, abolishing sanctions against Iraq and recognising the United States and United Kingdom as the country's occupying powers. The resolution called upon the US-UK authority to "comply fully with their obligations under international law, including in particular the Geneva Conventions of 1949 and the Hague Regulations of 1907." [1]

How has the CPA changed Iraq's economy and laws?
Among many changes, the US-UK Coalition Provisional Authority (CPA), has laid off hundreds of thousands of Iraqi workers, virtually eliminated trade tariffs and enacted laws that radically alter Iraq's economy. Order 39, decreed by CPA head Paul Bremer on September 20 2003, abolished Iraq's ban on foreign investment, allowing foreigners to own up to 100% of all sectors except natural resources. Over 200 state-owned enterprises, including electricity, telecommunications and pharmaceuticals have been privatised. Iraq's highest tax rate has been lowered from 45% to a flat rate of 15%. Although foreign ownership of land remains illegal, companies or individuals will be allowed to lease properties for up to 40 years. [2]

Are these changes legal?

These laws stand in clear violation of Iraq's constitution, as is openly admitted. The US department of commerce notes that "the Iraqi constitution prohibits foreign ownership of immovable (real) property," and "prohibits investment in, and establishment of, companies in Iraq by foreigners who are not resident citizens of Arab countries." [3]

Consider how the CPA's new laws and massive layoffs conform to its obligations under international law [4]:

· Hague Regulations

Art 43: The authority of the legitimate power having in fact passed into the hands of the occupant, the latter shall take all the measures in his power to restore, and ensure, as far as possible, public order and safety, while respecting, unless absolutely prevented, the laws in force in the country.

Art 46: Family honour and rights, the lives of persons, and private property, as well as religious convictions and practice, must be respected. Private property cannot be confiscated.

Art 47: Pillage is formally forbidden.

Art 53: An army of occupation can only take possession of cash, funds, and realisable securities which are strictly the property of the state, depots of arms, means of transport, stores and supplies, and, generally, all movable property belonging to the state which may be used for military operations. All appliances, whether on land, at sea, or in the air, adapted for the transmission of news, or for the transport of persons or things, exclusive of cases governed by naval law, depots of arms, and, generally, all kinds of munitions of war, may be seized, even if they belong to private individuals, but must be restored and compensation fixed when peace is made.

Art 55: The occupying State shall be regarded only as administrator and usufructuary of public buildings, real estate, forests, and agricultural estates belonging to the hostile State, and situated in the occupied country. It must safeguard the capital of these properties, and administer them in accordance with the rules of usufruct.

· Geneva Conventions:

Article 53: Any destruction by the occupying power of real or personal property belonging individually or collectively to private persons, or to the state, or to other public authorities, or to social or cooperative organisations, is prohibited, except where such destruction is rendered absolutely necessary by military operations.

Article 54: The occupying power may not alter the status of public officials or judges in the occupied territories, or in any way apply sanctions to or take any measures of coercion or discrimination against them, should they abstain from fulfilling their functions for reasons of conscience.

What is usufruct?

In accordance with Article 55 of the Hague Regulations, the US-UK are "regarded only as administrator and usufructuary" of Iraq's resources and immovable property, which it must administer "in accordance with the rules of usufruct." Bouvier's Law dictionary defines usufruct as: "The right of enjoying a thing, the property of which is vested in another, and to draw from the same all the profit, utility and advantage which it may produce, provided it be without altering the substance of the thing." [5]

As usufructary, the US-UK coalition would have the right to use Iraq's resources without altering or destroying the character of the resource itself. It is widely-recognised that agriculture, wherein crops can grow again and no serious effect is made on the soil or the land, is an appropriate usage of the right of usufruct. But oil is far different: the extraction of oil is the process of extracting the original resource itself, as the fossil fuels are not renewable and the character of the land from which it comes is severely altered, if not depleted. In addition, the responsibilities of usufruct can also apply to structural changes to a public resource or service. As Naomi Klein points out, "what could more substantially alter 'the substance' of a public asset than to turn it into a private one?"

Does the CPA know this already?

In a leaked March 26 memo that caused a stir in the UK, attorney general Lord Peter Goldsmith advised prime minister Blair that the invasion and subsequent occupation of Iraq was illegal. "My view is that a further security council resolution is needed to authorise imposing reform and restructuring of Iraq and its government," Lord Goldsmith wrote. He added that in his view "the imposition of major structural economic reforms would not be authorised by international law," and that "the longer the occupation of Iraq continues, and the more the tasks undertaken by an interim administration depart from the main objective [of disarming Saddam], the more difficult it will be to justify the lawfulness of the occupation." [6]

Notes

1. UN Security Council Resolution 1483, adopted May 22 2003.

2. Coalition Provisional Authority Order 39, enacted September 19 2003.

3. US Department of Commerce, "Overview of Commercial Law in Iraq".

4. Convention (IV) respecting the Laws and Customs of War on Land and its annex: Regulations concerning the Laws and Customs of War on Land (Hague Regulations). The Hague, 18 October 1907.

Convention (IV) relative to the Protection of Civilian Persons in Time of War (Geneva Conventions). Geneva, 12 August 1949.

5. Bouvier's Law Dictionary, cited in University of Tulsa Law Professor R. Dobie Langenkamp, What Happens to the Oil: International Law and the Occupation of Iraq", January 2003,

6. John Innes, "US and UK Action in post-war Iraq May be Illegal," The Scotsman, May 22, 2003.