An End Run Around The Iraqi Parliament  

With the proposed Iraq oil law (which gives Iraq's "undiscovered" - cough - oil to foreign oil companies) stalled by the rearguard action being fought by the Iraqi parliament, the oil majors are instead trying to get some US style "democracy" happening and getting the oil ministry to give them access to existing oil fields without parliamentary approval - Chevron reportedly in talks to tap Iraq's oil.

Chevron Corp. and other international oil companies are negotiating with the Iraq Ministry of Oil to begin tapping into some of the country's largest oil fields, according to published reports. Specifically, the companies are negotiating for two-year contracts that would help Iraq boost production at existing oil fields.

For years, the companies have had their eyes on long-term contracts to find and develop new oil fields in Iraq, which is believed to hold the world's third-largest oil reserves. The contracts under discussion are far more limited than that, but they represent an important step in opening Iraq's oil industry to foreign involvement after years of state control. San Ramon's Chevron already has held discussions with the Iraqi Oil Ministry about one of the short-term contracts, according to reports in the Associated Press, Dow Jones, Reuters and United Press International news services. BP, Exxon Mobil, Shell and Total also are pursuing the contracts. ...

But efforts to increase production and develop new fields have been stymied by Iraqi politics, as well as the widespread belief among Iraqis that the United States toppled Hussein to gain control of the country's oil. ...

The short-term contracts, called technical support agreements, may be an attempt by the Oil Ministry to make an end-run around legislators. The Iraqi Cabinet reportedly approved the move. "It was a way to get things going without calling it a production agreement," said Frank Verrastro, director of the energy program at the Center for Strategic and International Studies. ...

The proposed oil law has often come under criticism from anti-war activists, who fear that the Iraqi government will be pressured into handing over too much control of its oil. The short-term agreements may not assuage those fears. "My concern with these agreements is that they appear to be more than anything else a foot in the door, an opening for the oil companies while debate rages on over the long-term contracts," said Antonia Juhasz, author of "The Bush Agenda: Invading the World One Economy at a Time." "It's for the Iraqis to decide the appropriate role of U.S. oil corporations in Iraq," she said. "The only time to be able to have this kind of negotiation is when there's no longer an occupation."

AlterNet has a look at the recent surge of violence in Basra in terms of the attempted oil grab - "Managing Iraq's Econoccupation".

As violence rises again in Iraq, negotiations to institutionalize US economic dominance continue unabated. While the battle of Basra raged last week, a series of talks between the Bush administration and the US-backed Maliki government rolled forward. These negotiations may have at least as many implications for Iraq's future as the violence on the ground.

The discussions, ongoing since November, stem from a "Declaration of Principles" agreement signed by the two leaders, aimed at establishing a long-term "friendship" between their countries. While the portion of the Declaration that suggests a permanent US military presence in Iraq has garnered much attention, the agreement also proposes another goal: to solidify "economic ties" between the two countries and grant the US preferential treatment in trading with Iraq.

As brought to light by last week's oil price surge during the assault on Basra, economic concerns are inextricably linked to the occupation. When it comes to oil, the coming months may be crucial in determining what kind of "friends" the US and Iraq are going to be over the long haul. ...

The November version of the Bush-Maliki agreement suggested a commitment to "facilitating and encouraging the flow of foreign investments to Iraq, especially American investments, to contribute to the reconstruction and rebuilding of Iraq." According to James A. Paul, executive director of the Global Policy Forum, the "flow of foreign investments to Iraq" wouldn't manifest as generously as it sounds: The deal would primarily translate into "US/UK oil company control."

Last week's assault on Basra was "part of an effort to defeat the 'nationalists' in Iraq and consolidate a pro-US political regime that will go ahead with the oil deals," Paul told Truthout. Just before fighting erupted in Basra, the Iraqi presidential council approved the "provincial law," which clears the way for elections - potentially allowing nationalist leaders who oppose US oil interests to come to power. Maliki's Basra attack, says Paul, represents a failed attempt to quash that possibility.

It's not a question of pressure from oil companies, according to Reese Erlich, co-author of "Target Iraq: What the News Media Didn't Tell You." Buying up oil reserves is a strategic move to ensure US energy "security." The corporations become the vehicles for that security. "It's not like oil companies were pounding on the state house door to invade Iraq," Erlich told Truthout. "Oil companies certainly benefit, but they're not the initiators." ...

As Juhasz noted, one goal Bremer could not singlehandedly accomplish was the privatization of Iraq's reserves, which, by some estimates, may contain a quarter of the world's oil. The famed "Iraqi oil law," approved by the Maliki administration but still "stuck" in the Parliament, would, among other provisions, open up Iraq's underground oil for foreign investment. In its most recent draft, the law would leave only 12 of the country's oil reserves under government control, with the remaining 74 -- not to mention any undiscovered fields, which certainly exist -- up for grabs.

The primary grabbers would no doubt be American, as indicated by the Declaration of Principles' "especially American investments" clause. Since the early days of the occupation, the US has never kept its oil execs far from Iraq's oil. The oil fields, as well as the Oil Ministry in Baghdad, were some of the only places American soldiers guarded throughout the initial invasion. Paul notes that US "advisers" presided over the drafting of the latest version of the oil law.

According to the pan-Arab newspaper Al-Hayat, simultaneous with the battle of Basra, negotiations were taking place between major oil companies and the Iraqi ministry of oil. An Oil Ministry official told The Associated Press last week Chevron, Exxon and British Petroleum would soon submit proposals for contracts on specific oil fields - including the Rumaila field near Basra. Since the oil law has not yet passed, private companies can't obtain long-term contracts on the fields. However, that hasn't stopped them from getting their feet in the door.

AlterNet also has a transcript of the recent testimony of General William Odom (former Director of the NSA under Ronald Reagan) before the Senate Foreign Relations Committee on Iraq.

Good morning Mr. Chairman and members of the committee. It is an honor to appear before you again. The last occasion was in January 2007, when the topic was the troop surge. Today you are asking if it has worked. Last year I rejected the claim that it was a new strategy. Rather, I said, it is a new tactic used to achieve the same old strategic aim, political stability. And I foresaw no serious prospects for success.

I see no reason to change my judgment now. The surge is prolonging instability, not creating the conditions for unity as the president claims.

TomDispatch has an update on the recent offensive in Baghdad and Basra - "Ira Chernus, The General and the Trap". More at TomDispatch - Tom Engelhardt explaining why the Mahdi Army is able to defeat the American backed Iraqi army with ease - "American Grand Delusions" - "Why the Testimony of General Petraeus Will Be Delusional" - and Howard Zinn on "The End Of Empire".

They came, they saw, they… deserted.

That, in short form, is the story of the Iraqi government "offensive" in Basra (and Baghdad). It took a few days, but the headlines on stories out of Iraq ("Can Iraq's Soldiers Fight?") are now telling a grim tale and the information in them is worse yet. Stephen Farrell and James Glanz of the New York Times estimate that at least 1,000 Iraqi soldiers and policemen, or more than 4% of the force sent into Basra, "abandoned their posts" during the fighting, including "dozens of officers" and "at least two senior field commanders."

Other pieces offer even more devastating numbers. For instance, Sudarsan Raghavan and Ernesto Londoño of the Washington Post suggest that perhaps 30% of government troops had "abandoned the fight before a cease-fire was reached." Tina Susman of the Los Angeles Times offers 50% as an estimate for police desertions in the midst of battle in Baghdad's vast Sadr City slum, a stronghold of cleric Muqtada al-Sadr's Mahdi Army militia.

In other words, after years of intensive training by American advisors and an investment of $22 billion dollars, U.S. military spokesmen are once again left trying to put the best face on a strategic disaster (from which they were rescued thanks to negotiations between Muqtada al-Sadr and advisors to Prime Minister Nouri al-Maliki, brokered in Iran by General Qassem Suleimani, a man on the U.S. Treasury Department's terrorist watch list). Think irony. "From what we understand," goes the lame American explanation, "the bulk of these [deserters] were from fairly fresh troops who had only just gotten out of basic training and were probably pushed into the fight too soon."

This week, with surge commander General David Petraeus back from Baghdad's ever redder, ever more dangerous "Green Zone," here are a few realities to keep in mind as he testifies before Congress:

1. The situation in Iraq is getting worse: Don't believe anyone who says otherwise. The surge-ified, "less violent" Iraq that the general has presided over so confidently is, in fact, a chaotic, violent tinderbox of city states, proliferating militias armed to the teeth, competing regions armed to the teeth, and competing religious factions armed to the teeth. Worse yet, under Petraeus and Ambassador Ryan Crocker, the U.S. has been the great proliferator. It has armed and funded close to 100,000 Sunnis organized into militias reportedly intent on someday destroying "the Iranians" (i.e. the Maliki government). It has also supported Shiite militias (aka the Iraqi army). In the recent offensive, it took sides in a churning Shiite civil war. As Nir Rosen recently summed matters up in a typically brilliant piece in the Nation magazine, Baghdad today is but a set of "fiefdoms run by warlords and militiamen," a pattern the rest of the country reflects as well. "The Bush administration," he adds, "and the U.S. military have stopped talking of Iraq as a grand project of nation-building, and the U.S. media have dutifully done the same." Meanwhile, in the little noticed north of the country, an Arab/Kurdish civil war over the oil-rich city of Kirkuk and possibly Mosul as well is brewing. This, reports Pepe Escobar of Asia Times, could be explosive. Think nightmare.

2. The Bush administration has no learning curve. Its top officials, military and civilian, are unable to absorb the realities of Iraq (or the region) and so, like the generals of World War I, simply send their soldiers surging "over the top" again and again, with minor changes in tactics, to the same dismal end. Time.com's Tony Karon, at his Rootless Cosmopolitan blog, caught this phenomenon strikingly, writing that Maliki's failed offensive "shared the fate of pretty much every similar initiative by the Bush Administration and its allies and proxies since the onset of the 'war on terror.'"

3. The "success" of the surge was always an expensive illusion for which payment will someday come due. To buy time for its war at home, the Bush administration put out IOUs in Iraq to be paid in future chaos and violence. It now hopes to slip out of office before these fully come due.

4. A second hidden surge, not likely to be discussed in the hearings this week, is now under way. U.S. air reinforcements, sent into Iraq over the last year, are increasingly being brought to bear. There will be hell to pay for this, too, in the future.

5. A reasonably undertaken but speedy total withdrawal from Iraq is the only way out of this morass (and, at this late date, it won't be pretty); yet such a proposal isn't on the table in Washington at the moment. In fact, as McClatchy's Warren Strobel and Nancy Youssef report, disaster in Basra has actually "silenced talk at the Pentagon of further U.S. troop withdrawals any time soon."

Salon has a column by Juan Cole on "Why al-Maliki attacked Basra".

The campaign was a predictable fiasco, another in a long line of strategic failures for the sickly and divided Iraqi government, which survives largely because it is propped up by the United States. So why did al-Maliki do it? With no obvious immediate crisis in Basra that called for such desperate measures, what could have motivated the decision to attack?

Three main motivations present themselves: control of petroleum smuggling, staying in power (including keeping U.S. troops around to ensure it), and the achievement of a Shiite super-province in the south. A southern super-province would spell a soft partition of the country, benefiting Shiites in the long term while cutting Sunnis out of substantial oil revenues, both licit and illicit.

The Guardian has a column by Jospeh Stiglitz noting that the US$3 trillion cost estimate for the Iraq war may be too low. Just imagine if they'd put all that money into clean energy technology and energy efficiency measures instead of trying to nick Iraq's oil.

President Bush has tried to give the impression that the $3 trillion dollar estimate of the total cost of the war that we provide in our new book may be exaggerated.

We believe that it is, in fact, conservative. Even the president would have to admit that the $50 to $60 billion estimate given by the administration before the war was wildly off the mark; there is little reason to have confidence in their arithmetic. They admit to a cost so far of $600 billion.

Our numbers differ from theirs for three reasons: first, we are estimating the total cost of the war, under alternative conservative scenarios, derived from the defence department and congressional budget office. We are not looking at McCain's 100-year scenario - we assume that we are there, in diminished strength, only through to 2017. But neither are we looking at a scenario that sees our troops pulled out within six months. With operational spending going on at $12 billion a month, and with every year costing more than the last, it is easy to come to a total operational cost that is double the $600 billon already spent.

Second, we include war expenditures hidden elsewhere in the budget, and budgetary expenditures that we would have to incur in the future even if we left tomorrow. Most important of these are future costs of caring for the 40% of returning veterans that are likely to suffer from disabilities (in excess of $600 billion; second world war veterans' costs didn't peak until 1993), and restoring the military to its prewar strength. If you include interest, and interest on the interest - with all of the war debt financed - the budgetary costs quickly mount.

Finally, our $3 trillion dollars estimate also includes costs to the economy that go beyond the budget, for instance the cost of caring for the huge number of returning disabled veterans that go beyond the costs borne by the federal government - in one out of five families with a serious disability, someone has to give up a job. The macro-economic costs are even larger. Almost every expert we have talked to agrees that the war has had something to do with the rise in the price of oil; it was not just an accident that oil prices began to soar at the same time as the war began.

We have been criticised, but for being excessively conservative, for including only $5 to $10 of the $75 to $85 increase in the price of oil since then. Money spent on the war - on a Nepalese contractor working in Iraq - does not stimulate the economy as much as money spent on hospitals or research or schools at home. These contractionary effects were temporarily covered up, hidden, by the flood of liquidity and lax regulations that led to a housing bubble and a consumption boom - with household savings plummeting to zero. But this simply postponed paying these costs - and increased them. ...

In adding up the quantifiable costs of the war, it is hard not to come up with a number in excess of $3 trillion. In putting a $3 trillion price tag on the war, we believe we have been excessively conservative - a $4 or $5 trillion tag would be more reasonable. And remember - this is just the cost for America

Energy Bulletin has 3 interesting articles in a roundup of news on the Iraq war - an Asia Times article - "Iran torpedoes US plans for Iraqi oil, an AP article on the cost of fuel for the military - "Military feels the gouge of fuel costs as Iraq, allies watch oil profits soar" and Louis Farrakhan asking "Is Oil The Motive For War ?".

Jeff Vail has some thoughts about "Peak Surge Success".

All of which brings me to why the surge was doomed to failure in the first place. While Petraeus’s updated counterinsurgency strategy was elegant and interesting, it never stood a chance because it does not address (or comprehend) the foundational problem of mutually exclusive overlap. I’ve been writing about this since immediately after I returned home from the Persian Gulf in 2004 as it creates the post-colonial terrain upon which everything else in Iraq must be surveyed. Mutually exclusive overlap is the result of the ebb and flow of empire over time, and must be seen as a four-dimensional problem. Since the Sykes-Picot Accord of 1918 arbitrarily drew lines in the Middle-Eastern sand and created notional “Nation-States” where none had been before, colonial powers (as well as those later powers practicing economic colonialism) have pitted one ethnic group against another to most effectively control their far-flung empires. This is what I call the “exploitation model,” and typically involves empowering a minority group to rule a territory with the implicit understanding that the minority group must act according to the will of the colonial power or be abandoned to the mercy (or lack thereof) of the majority. In Iraq, this took the form of long-standing British and then American support for a Sunni minority government in a Shi’a majority territory. The problem of mutually exclusive overlap arises with the development of Iraq’s vast oil potential. The Sunni majority enjoyed several decades of wealth and prosperity, subsidized entirely by their disproportionate share of oil export revenue. Now that the Shi’a are in power, they expect at a minimum a proportionate share of Iraq’s oil revenue (60%), which is virtually all of Iraq’s southern oil production as the Kurds have geographic and de-facto control over Iraq’s northern oil reserves which make up about a third of Iraq’s pre-war oil production potential. So this creates a situation where the Sunni society, economy, and psyche in Iraq is predicated on the subsidy of more than half of Iraq’s oil production, because they have enjoyed exactly this for decades. Likewise, the newly empowered Shi’a have an expectation of more than half of oil production. For both groups this is a non-negotiable minimum, and they will fight for what they consider their birthright. Unfortunately, this represents mutually exclusive overlap—with both groups expecting, at a minimum, essentially all the oil production available outside the Kurdish zone, they cannot both be satisfied. This cannot be solved by increasing Iraq’s oil production because the expectations are proportional, not empirical, and will only suffice to provide a relative advantage, not actual wealth, even if Iraq’s production were to reach 8 million barrels per day (a wildly optimistic figure four time current production) due to their growing population and dire economic problems. There is no nice way to put it: this problem will not be solved, and will result in conflict—the only question is when.

The Petraeus surge worked, either through happenstance or devious planning, by scheduling simultaneously the period when the Sunni factions realized they should pause and take advantage of an American-provided opportunity to re-arm for this coming conflict, and the time when the Shi’a factions realized they should pause to consolidate for the same. The surge is now disintegrating because the value to both sides of further “strategic pause” is winding down. Moqtada al-Sadr’s maneuvering in the South, combined with a gradual increase in Sunni violence around Baghdad, signal the transition to the next phase. This next phase may be remarkably contained, or it may bring Saudi Arabia and Iran into much more direct involvement. What is relatively certain is that neither 45,000 nor 145,000 American troops on the ground will be able to keep the peace. We entered this conflict with an almost awe-inspiring naïveté, and I have little confidence that we’ll figure out how to exit any more gracefully.

The Village Voice thinks the US exit will be a graceless maneuver carried out via helicopter - and without the prize.

A year later, where is Prime Minister Nouri Maliki? He's in Basra, where the fight over oil is now taking place. If the Basra situation degenerates, Iraq won't remain a single country. Baghdad and the central provinces don't have the oil; it's only in the northern and southern regions, where war is either raging or imminent.

Dick Cheney got his wish: We're fighting for oil, and all the rest is bullshit.

Keep in mind that Basra is now exploding only after the British handed over control of that southern city to Iraqi forces. What do you think will happen in Baghdad when we pull out? Whether Maliki will survive is questionable. He's liable to get blown up while he's in Basra. His chances of survival are about as good as Benazir Bhutto's were.

Even before the 2003 U.S. invasion, the Pentagon was warned by one of its own agencies, the Naval Postgraduate School, of the civil war. Naturally, that went unreported at the time. As I wrote in May 2005:

Back in the summer of 2002, when Bush's handlers were plotting the invasion of Iraq, the Pentagon neocons were warned of the consequences: chaos, a fractured country. All we heard about was the propaganda about "liberation."

In June 2001, James A. Russell, a Persian Gulf expert in the Department of Defense, was assigned by Doug Feith, Don Rumsfeld's undersecretary for policy, to the National Security Affairs Department at the Naval Postgraduate School. Just a guess, but I would imagine that meant that Russell was not part of Feith's inner circle.

Anyway, the Naval Postgrad School, a slice of governmental academe, formed something called the Center for Contemporary Conflict and started pumping out research papers, posting them in an electronic journal, Strategic Insights. They make for interesting, and relatively jargon-free, reading. In June 2002, for instance, Russell produced "Shibboleth Slaying in a Post-Saddam Iraq," a nice little report that charted our options for Iraq while we were already planning to invade it. "As the United States marches inexorably towards regime change in Baghdad," Russell wrote, "the critical issue facing policy makers is determining what happens after Saddam is removed from power."

Russell noted that Iraq is an unnaturally unified country—and he concluded that maybe it shouldn't even stay that way.

It won't. And our personnel in Baghdad's supermax embassy will wind up fleeing by helicopters, just as Americans did when they fled Saigon in 1975.

And we'll leave without the oil.

AlterNet has an interview with Noam Chomsky, asking "Why Don't We Ask What's Best For the Iraqis?".

During this election season we’ve already heard Republicans and Democrats alike discussing the best way for America to save face in Iraq, as if the sake of our ego is of enough importance to defy international law. Obama, Clinton, and McCain will all keep troops in Iraq indefinitely, despite the will of the Iraqi people. That “democracy” we brought them sure isn’t worth a damn when we don’t respect it ourselves. Just as the Palestinians learned when they elected Hamas into power, the will of a people in their own land is only legitimate when it coincides with our imperialistic Western vision for the region.

American politicians are regularly asked what they think the best option is for Iraq. As Chomsky bluntly states, aggressors have no rights. Our occupation is criminal. What Americans want for Iraq is irrelevant.