Jewish World Review April 20, 2004 / 30 Nissan, 5764
A tangled web, unraveled: How a critical aid program for Iraq was undermined by greed and cynical insider deals
The prospects of the United Nations taking over the transition in Iraq may now be fatally compromised. The world body is caught up in a welter of allegations and evidence suggesting strongly that a noble effort of humanitarian assistance was tainted by greed, bribery, and the most venal kind of power politics. The U.N. was supposed to oversee the oil-for-food program that allowed Saddam Hussein to sell oil and use the proceeds to buy essential food and medicine for the Iraqi people. At least $10 billion, evidently, went into the pockets of political operators.
It is a tribute to the new American-installed democracy in Iraq that an Iraqi newspaper has been in the forefront of exposing the racket and naming the 270 international power brokers who seem to have had their hands in the till. Here's how the scam allegedly worked: Saddam sold oil to his friends and allies around the world at deep discounts. The buyers resold the oil at huge profits. Saddam then got kickbacks of 10 percent from both the oil traders and the suppliers of humanitarian goods. Iraqi bean counters, fortunately, kept meticulous records.
Coincidence. If you wondered why the French were so hostile to America's approach to Iraq and even opposed to ending the sanctions after the 1991 Gulf War, here's one possible explanation: French oil traders got 165 million barrels of Iraqi crude at cut-rate prices. The CEO of one French company, SOCO International, got vouchers for 36 million barrels of Iraqi oil. Was it just a coincidence that the man is a close political and financial supporter of President Jacques Chirac? Or that a former minister of the interior, Charles Pasqua, allegedly received 12 million barrels from Baghdad? Or that a former French ambassador to the U.N., Jean-Bernard Merimee, received an allocation of 11 million barrels? Perhaps it was just happenstance, too, that a French bank with close ties to then French President François Mitterrand and one of the bank's big shareholders who is close to Saddam became the main conduit for the bulk of the $67 billion in proceeds from the oil-for-food program. All told, 42 French companies and individuals got a piece of this lucrative trade. No matter how cynical you may be, it's sometimes just plain hard to keep up with the French.
But they're not alone. Russians received more than 2.5 billion barrels of the cut-rate crude. Some 1.4 billion barrels went to the Russian state. Not to be left out of the feeding frenzy, even the U.N. got in on the action. It received administrative fees of about $2 billion for the program, which may be fair, but the senior U.N. official in charge of the program, Benon Sevan, is reported to have received 11.5 million barrels himself. Cotecna, a Swiss-based firm hired by the U.N. to monitor the import of the food and medicine to Iraq, hired Kojo Annan, the son of U.N. Secretary General Kofi Annan, as a consultant during the period when the company was assembling and submitting bids for the oil-for-food program. All of these coincidences were reported by Claudia Rosett in the National Review. None, surprisingly, were disclosed by the U.N., Cotecna, or the senior or junior Annan. The imposition of so-called smart sanctions on Iraq, several years after the end of the 1991 Gulf War, allowed Saddam to purchase items besides food and medicine. But some of the things approved by Kofi Annan seem pretty far afield. There was the $20 million he authorized for an Olympic sports city for Uday Hussein, Saddam's reprehensible (and now deceased) oldest son. And then there was the $50 million for TV and radio equipment for Saddam's ham-handed propaganda machine. This is food? Gives new meaning to Kofi Annan's statement, in 1998, that Saddam was a man "I can do business with." And how.
All of this would seem to raise a few questions about the intense opposition to the American intervention in Iraq within the U.N. Security Council, and particularly from Paris and Moscow. In one way or another, the U.N. stonewalled, until now, a serious independent investigation of the oil-for-food program. To his credit, Kofi Annan is now supporting such an investigation, but the Security Council has not approved it, and France and Russia--surprise!--are actively blocking it. Former Federal Reserve Chairman Paul Volcker has agreed to head the inquiry, but only if it is blessed by a Security Council vote. Absent such a vote, there is still an awful lot of explaining to be done.
Will the investigation be whitewashed to preserve the U.N.'s reputation so that it can replace the CPA in Iraq, or will the investigation get to the bottom of this ugly mess? Fortunately, Congress is going to conduct its own hearings on the largest public financial scandal in history--and the disgraceful insiders' game played at the U.N.
Every weekday JewishWorldReview.com publishes what many in Washington
and in the media consider "must reading." Sign up for the daily JWR update. It's free. Just click here.
JWR contributor Mort Zuckerman is editor-in-chief and publisher of U.S. News and World Report. Send your comments to him by clicking here.
04/16/04: The high price of hindsight
04/11/04: Getting real about gas prices
03/16/04: Dems demagoguing protectionism adds up to economic nonsense
03/02/04: A truly cruel college squeeze
02/10/04: Fixing what's broken
01/13/04: Policing the corporate suites
11/25/03: Slowly but surely in Iraq
11/12/03: Holding their feet to the fire
10/29/03: Graffiti On History's Walls
09/04/03: All work and no play
08/29/03: Facing the other threat among us
07/23/03: Making odds on a recovery
07/15/03: A Kremlin conversation
06/10/03: Welcome to Sue City, U.S.A.
05/05/03: America's next critical test
04/22/03: The challenge of success
04/15/03: Shape up or step aside
04/08/03: The latest in reality TV is …
04/02/03: Chirac and Saddam's thugs are two of a kind
03/26/03: War by new rules
03/05/03: The high price of waiting
02/14/03: Needed: fast fiscal action
02/03/03: Clear and compelling proof
01/24/03: Midnight for Baghdad
01/14/03: They should have said...
12/24/02: Who finances the fanatics?
12/19/02: Put-up or shut-up time
12/09/02: Sheep, wolves, and reality
11/21/02: Curing the uncommon cold
11/12/02: Everybody has the right to be wrong … but the Dems have been abusing the privilege
11/05/02: Force vs. fanaticism
10/30/02: Land of the sinking sun
10/22/02: No more cat and mouse
10/15/02: And pigs will fly
10/07/02: A shameful contagion
09/26/02: Calling a madman's number
09/23/02: Our rainbow underclass
09/13/02: Why America must act
09/04/02: After bubbles, a double dip?
08/20/02: No time for equivocation
08/06/02: No time for politics
07/30/02: Getting off the dime
07/17/02: What scandal cannot dim
06/18/02: Time to crack down: Where is the outrage?
06/05/02: The next new thing
04/30/02: Roller-coaster nation
04/25/02: A critical tipping point
04/15/02: Israel's endgame will impact the free world
03/21/02: In the face of pure evil
03/14/02: A man on a mission
03/07/02: Land of the Sinking Sun
02/12/02: Speaking truth about energy
01/15/02: Putting our house in order
01/12/02: Talking points for 2002
12/24/01: The shape of things to come
12/11/01: Finally, a clarity of vision
12/04/01: Apocalypse now
11/26/01: The Big Apple's core
11/06/01: What it will take to win
10/22/01: Getting the mayor's message
10/08/01: A remedy for repair
10/01/01: A question of priorities
09/26/01: Our mission, our moment
09/11/01: Running the asylum
08/29/01: Hail, brave consumer
06/14/01: Blackouts --- or blackmail?
06/01/01: A time to reap --- and sow
05/25/01: A question of confidence
05/18/01: A question of confidence
05/04/01: Making the grade
04/26/01: The caribou conundrum
04/19/01: Chinese boomerang
03/27/01: The man of the moment
03/20/01: The Fed must be bold
03/15/01: Japan on the brink
03/01/01: Rethinking the next war
02/09/01: The education paradox
01/08/01: How the bottom fell out
01/03/01: Quipping in the new year
12/20/00: A time for healing
11/13/00: The need for legitimacy
10/30/00: Arafat's bloody cynicism
10/18/00: Arafat torches peace
10/03/00: A great step backward
09/08/00: The Perfect Storm
08/29/00: Don't blow the surplus
08/15/00: Voting for grown-ups
08/01/00: Arafat's lack of nerve
07/17/00: Can there be a new peace between old enemies? Or will new enemies regress to an old state of war?
07/11/00: A time to celebrate
06/19/00: A bit of straight talk
06/08/00: Using hate against Israel
05/26/00: Is the Federal Reserve trigger-happy?
04/18/00: Tensions on the 'Net
04/13/00: A paranoid power
03/10/00: Fuel prices in the red zone
02/25/00: Web wake-up call
02/18/00: Back to the future
01/21/00: Whistling while we work
01/11/00: Loose lips, fast quips
12/23/99: The times of our lives
12/14/99: Hey, big spender
11/18/99: Fountain of Youth
11/04/99: An impossible partner
10/14/99: A nation divided
10/05/99: India at center stage
09/21/99: Along with good cops, we need a better probation system
09/08/99: Though plundered and confused, Russia can solve its problems
08/31/99: The military should spend more on forces and less on facilities
08/05/99: Squandering the surplus
07/06/99: More than ever, America's unique promise is a reality
06/24/99: The time has come to hit the brakes on affirmative action
06/15/99: America should take pride in honoring its responsibilities
06/02/99: The Middle Kingdom shows its antagonistic side
05/11/99: Technology's transforming power is giving a lift to everything
05/04/99: The big game gets bigger
04/30/99: On Kosovo, Russia talked loudly and carried a small stick
04/21/99: No time to go wobbly
04/13/99: The Evil of two lessers
© 2001, Mortimer Zuckerman