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The Peace Camp's Humanitarian Scam

We've all heard all the disgust and cynicism about how America's "neocons" were unscrupulous warmongers who wanted war in any case, haven't we?

We've also heard about how George W Bush and his ilk are liars, and how the warning about weapons of massive destruction turned out to be nothing but a fraud, one of the basest kind.

We've also all heard about how they, purposefully or not and because they were Macchiavellian or because they were brain-damaged, missed a chance to "give peace a chance", by turning to the international community and to the United Nations.

We have heard how, basically, by bringing every actor on the international scene into the equation, discussion would have ensued that would have guaranteed a peaceful outcome, and a result that would have pleased everybody (or, at least, everyone who was willing to approach the subject with an open mind and a generous heart).

We have heard how the failure to do that simple thing brought anger against Washington and fury over its "arrogance". We have heard how this results in foreigners sputtering that "America deserves/deserved (name your tragedy)". We are led to understand that their thinking such thoughts, and their making such statements, is far from inappropriate.

We have also all heard all about how principled a number of leaders were (many of them European), who tried their best to avert war, and how they tried to make the UN system work.

In fact, they have been called the "Peace Camp" (mainly by themselves, but let's not get into that).

Well…

You know what, guys, guess what?

I know it sounds totally unbelievable, but I'm gonna tell you anyway…

It turns out that…

… the "Peace Camp" members were not as altruistic as they would have us believe.

It turns out that… the world leaders working "to give peace a chance" were not as disinterested as they would have us believe.

It turns out that the UN is not as beneficient as its supporters would have us believe.

In fact, to be quite honest…

The above-mentioned leaders' main reason for opposing Washington seems to have been to profit from "grand larceny" with one of the most blood-thirsty dictators born in the 20th Century.

To hear Claudia Rosett tell it,

The UN, in the name of its own lofty principles, and to its rich emolument, actively helped sustain and protect a tyrant whose brutality and repression were the cause of Iraqi deprivation in the first place.

No wonder Kofi Annan said "Now is not the time to point fingers".

No wonder France's ambassador to the United Nations said that "I don't want to comment on the past".

And, especially: No wonder large parts of the entire international community opposed the ouster of Saddam Hussein.

No wonder that the more commercial interests a country had with the horrific dictator, the more opposed it was to the Coalition of the Willing. In other words, they instituted, to use Claudia Rosett's memorable phrase,

a gala of graft, theft, fraud, palace-building and global influence-peddling.

Reminder: These are the countries that speak (endlessly) of generosity and open-mindedness, of "dialog and consensus", of "respect and humility", of understanding and universal brotherhood. These are the people who "pine for genuine international multilateralism" with breaking voices and dramatic gestures.

All this brings up a second thought, concerning other charges against the United States in the past (by the same voices). Maybe Washington's reluctance to pay its UN dues in the past was not entirely due to American "arrogance" and "unilateralism"; maybe, just maybe, it was due to that part of the American character that can best be characterized as clairvoyance and common sense.

But let's get back to the main subject, concerning which The Economist quotes Claude Hankes-Drielsma as telling Congress's government-reform sub-committee that: "The very fact that Saddam Hussein, the UN, and certain members of the Security Council could conceal such a scam from the world should send shivers down every spine in this room". (Should that not be every room, legislative and otherwise, throughout the countries of the world represented at the "august" body, one is tempted to ask.)

Where shall we start? There are so many places…

Let's see…

Saddam Was the Peace Camp Members' Cash Cow

Let's start with an editorial in the New York Post. You've read about how scandalously extremist conservative media outlets like Fox News and the Post are, right? Well, read how skewered this Post editorial is. (It's by Dick Morris, a political strategist for the president; no, not for the Republican president — but for Bill Clinton (!), with whom he enjoyed a long relationship and for whose election campaigns he turned out to be a vital operative.)

Anyone who pines for genuine international multilateralism would do well to follow the bribes now being uncovered in the United Nations' Oil-for- Food scandal.

Why did France and Russia oppose efforts to topple Saddam Hussein's regime? And why did they press constantly, throughout the '90s, for an expansion of Iraqi oil sales? Was it their empathy for the starving children of that impoverished nation? Their desire to stop the United States from arrogantly imposing its vision upon the Middle East?

It now looks like they it was simply because they were on the take. Saddam was their cash cow. If President Bush has suffered some discredit over his apparently false — but not disingenuous — claims of Iraqi weapons of mass destruction, the lapse is minor compared to the outright personal selfishness and criminality that appears to have motivated many of those who opposed his efforts to rid the world of one of its worst dictators.

Throughout the '90s, France and Russia badgered the United States and Britain to increase Iraqi oil production. President Bill Clinton and Prime Minister Tony Blair fought them at each step, but then reluctantly gave way. First Iraq was allowed to sell 500,000 barrels daily. Then, on Franco-Russian insistence, it was raised to 1 million, then to 2 million and, finally, to 3 million barrels a day.

Each time, America and Britain — the nations now accused of coveting Iraqi oil — resisted the increases in Iraqi production and urged tighter controls over the program. Each time, the French and the Russians prattled on about the rights of Iraqi sovereignty and the need to feed the children.

Now we know why the French and Russians were so insistent. Iraqi government documents (leaked to the Baghdad newspaper Al Mada) list at least 270 individuals and entities who got vouchers allowing them to sell Iraqi oil — and to keep much of the money. These vouchers, and the promise of instant great wealth they carried with them, bought vital support in the United Nations to let Saddam stay in power. …

The defect of international coalitions is that they include the just and the unjust, the bribed and the honest, the democratic and the autocratic. And their members cannot be trusted equally. The group that stood up and backed the invasion of Iraq was nicknamed "the Coalition of the Willing." Now it appears it was also "the Coalition of the Honest."

The UN's Oil-for-Food Program Was
Worse than a Case of Grand Larceny

Meanwhile, Claudia Rosett seems to have emerged as the foremost expert on this graft scandal. We have seen her New York Times column on the "axis of Avarice" elsewhere on this website. More recently, she wrote a summary of the whole sordid affair in the Wall Street Journal, a longer version of which was published in Commentary.

It's looking more and more as if one of the best reasons to get rid of Saddam Hussein was that it was probably the only way to get rid of Oil-for-Food. The problem wasn't simply that this huge United Nations relief program for Iraq became a gala of graft, theft, fraud, palace-building and global influence-peddling — though all that was quite bad enough. The picture now emerging is that under U.N. management the Oil-for-Food program, which ran from 1996-2003, served as a cover not only for Saddam's regime to cheat the Iraqi people, but to set up a vast and intricate global network of illicit finance.

And though much debate has focused on the list published this past January in the Iraqi newspaper Al Mada — cataloguing some 270 individuals and entities world-wide alleged to have received illicit oil vouchers worth millions from Saddam — the Al Mada list may be the least of it … Dwarfing the Al Mada list for size, scope and menace was the U.N.-piloted mothership, the entire $111 billion U.N. Oil-for-Food program. Supplied by Iraq's oil wells, the sums involved in Oil-for-Food's transactions were so enormous that even the routine rounding errors of a few hundred million here or there easily rivaled, for example, the $300 million or so in family money believed to have given Osama bin Laden his terrorist start.

In a world beset right now by terrorist threats — which depend on terrorist financing — it's time to acknowledge that the U.N.'s Oil-for-Food program was worse than simply a case of grand larceny. Given Saddam's proclivities for deceit and violence, Oil-for-Food was also a menace to security. By letting Saddam pick his own business partners and draw up his own shopping lists, by keeping the details of his contracts and accounts secret, and by then failing abjectly to supervise the process, the U.N. — through a program meant to aid the people of Iraq — enabled Saddam to line his pockets while bankrolling his pals world-wide. …

In tallying various leaked lists, disturbing leads and appalling exposés to date, what becomes ever more clear is that Oil-for-Food quickly became a global maze of middlemen, shell companies, fronts and shadowy connections, all blessed by the U.N. From this labyrinth, via kickbacks on underpriced oil and overpriced goods, Saddam extracted, by conservative estimates of the General Accounting Office, at least $4.4 billion in graft, plus an additional $5.7 billion on oil smuggled out of Iraq. Meanwhile, Annan's Secretariat shrugged and rang up its $1.4 billion in Iraqi oil commissions for supervising the program. Worse, the GAO notes that anywhere from $10 billion to as much as $40 billion may have been socked away in secret by Saddam's regime. The assumption so far has been that most of the illicit money flowed back to Saddam in the form of fancy goods and illicit arms.

But no one really knows right now just how much of those billions went where — or what portion of that kickback cash Saddam might have forwarded to whatever he deemed a worthy cause. A look at one of the secret U.N. lists of clients authorized by the U.N. to buy from Saddam is not reassuring. It includes more than 1,000 companies, scattered from Liberia to South Africa to oil-rich Russia. … would Mr. Annan care to explain why the U.N. authorized Saddam to sell oil to at least 70 companies in the petroleum-soaked United Arab Emirates?

In Oil-for-Food, "Every contract tells a story," says John Fawcett, a financial investigator with the New York law firm of Kreindler & Kreindler LLP, which has sued the financial sponsors of Sept. 11 on behalf of the victims and their families. In an interview, Mr. Fawcett and his colleague, Christine Negroni, run down the lists of Oil-for-Food authorized oil buyers and relief suppliers, pointing out likely terrorist connections. One authorized oil buyer, they note, was a remnant of the defunct global criminal bank, BCCI. Another was close to the Taliban while Osama bin Laden was on the rise in Afghanistan; a third was linked to a bank in the Bahamas involved in al Qaeda's financial network; a fourth had a close connection to one of Saddam's would-be nuclear-bomb makers.

U.N. secrecy — in deference to the privacy of Saddam and his former clientele — makes it extremely difficult to confirm the many whiffs of sleazy and sinister dealings in these lists. … Basically, Oil-for-Food was Saddam — just slightly harder to spot, swaddled as he was in that blue U.N. flag.

Saddam's Info and Justice Ministries and More
— In Fact, His Totalitarian State Infrastructure —
Directly Funded by the UN Relief Fund

InCommentary, Claudia Rosett provides a longer article with more details of the scam.

By [2000, Saddam] was not only selling vastly more oil but had institutionalized a system for pocketing cash on the side.

It worked like this. Saddam would sell at below-market prices to his hand-picked customers—the Russians and the French were special favorites—and they could then sell the oil to third parties at a fat profit. Part of this profit they would keep, part they would kick back to Saddam as a "surcharge," paid into bank accounts outside the UN program, in violation of UN sanctions.

By means of this scam, Saddam’s regime ultimately skimmed off for itself billions of dollars in proceeds that were supposed to have been spent on relief for the Iraqi people. …

[Beyond that, Saddam instigated a smuggling operation that] was in flagrant defiance of UN sanctions and made a complete mockery of Oil-for-Food, whose whole point was to channel all of Saddam’s trade. The smuggling, too, was widely reported in the press—and shrugged off by the UN. …

Shake your head disapprovingly as you listen to how oil-hungry, greedy, and treacherous Washington and Downing Street were.

As Oil-for-Food grew in size and scope, the U.S. mission to the UN began putting a significant number of its relief contracts on hold for closer scrutiny. Both [Iraq program executive director Benon] Sevan and Annan complained publicly and often about these delays, describing them as injurious to the people of Iraq and urging the Security Council to push the contracts through faster. …

Keep reading…

[In 2002] "humanitarian" became a broad category indeed. [In June], Annan approved a newly expanded shopping list by Saddam that the Secretariat dubbed "Oil-for-Food Plus." This added ten new sectors to be funded by the program, including "labor and social affairs," "information," "justice," and "sports." Either the Secretary-General had failed to notice or he did not care that none of these had anything to do with the equitable distribution of relief. By contrast, they had everything to do with the running of Saddam’s totalitarian state. "Labor," "information," and "justice" were the realms of Baathist party patronage, propaganda, censorship, secret police, rape rooms, and mass graves. As for sports, that was the favorite arena of Saddam’s sadistic son Uday, already infamous for torturing Iraqi athletes. …

[In September 2002], the Coalition for International Justice released its heavily researched report, Sources of Revenue for Saddam & Sons, documenting rampant corruption and smuggling under UN sanctions and Oil-for-Food, warning of an Iraqi shift from "informal, on-the-sly deals" to increasingly "brazen and formal government-to-government arrangements," and asking how, "given . . . the world’s largest humanitarian program ever, can there remain shortages of basic medicines and foodstuffs" in Iraq? Four months later, with Saddam still defiant and war looking likely, Annan signed a letter to the Security Council in which, among other things, he approved the use of $20 million in Oil-for-Food funds to pay for an "Olympic sport city" and $50 million to equip Saddam’s propaganda arm, the Ministry of Information.

By then, of course, debate over Iraq was raging in the Security Council, and the U.S. and Britain were bitterly at odds with France and Russia. Annan weighed in publicly on the side of the latter, urging yet more time and tolerance. He did not mention his own interest as the boss of a massive relief program funded by Saddam. Neither did he mention that Saddam’s commercial deals heavily favored French and Russian companies, though he had access to actual numbers about those deals that, thanks to UN secretiveness, the public did not.

The UN's Relief Program Helped Sustain a Tyrant
Whose Brutality and Repression were the Cause of
Iraqi Deprivation in the First Place

Here is Claudia Rosett's conclusion. She starts with a "prelude":

That Saddam Hussein was a monster and a corrupt monster is not news. That he would exploit, for massive personal gain, a humanitarian program meant to relieve the miseries of his countrymen is horrifying but hardly astonishing. Nevertheless, any investigation that confines itself to detailing the abundantly evident corruption of Saddam Hussein will have missed the point.

What lies at the core of this story is the United Nations, and how it came to pass that an institution charged with bringing peace and probity to the world should have offered itself up—willingly, even eagerly—as the vehicle for a festival of abuse and fraud.

To begin with, Oil-for-Food was an enormous venture in central planning, the biggest project of its kind launched in many a decade and one that utterly ignored the lessons about such systems learned at agonizing cost over the past century. The UN Secretariat, in its well-paid arrogance, set out to administer virtually the entire economy of Iraq. Under its eye, all legitimate trading privileges became the franchise of a tyrant who laid first claim to every barrel of oil and every dollar (or euro) of proceeds. How could Oil-for-Food not help consolidate Saddam’s grip on power? Nevertheless, it was with this grand thief of Baghdad that the UN cut its humanitarian deal, chalking in a fat commission for the Secretariat.

Nor did anyone in the UN system so much as lift an eyebrow, even after questions began to be raised. Last November, before the Security Council of the United Nations, the organization’s Secretary-General proclaimed it a splendid achievement that the UN had legitimized a scheme by which 60 percent of Iraq’s population depended entirely on the rationing cards of a totalitarian state. This was an event that should have seized the vaunted international community with horror. Instead, from out of the mouth of the Angolan ambassador who that month was chairing the UN Security Council there issued only unctuous praise for "the exceptionally important role of the program in providing humanitarian assistance to the people of Iraq."

That prelude leads to Rosett's conclusion on the "scope of UN dereliction is much broader, encompassing factors institutional, personal, and, finally, political":

It is true that Oil-for-Food managed to deliver to Iraqis some portion of what it promised. …

But at what cost? Are we supposed to conclude that, in order to deliver this amount of aid, the UN had to approve Saddam’s more than $100 billion worth of largely crooked business, had to look the other way while he skimmed money, bought influence, built palaces, and stashed away billions on the side, at least some of which may now be funding terror in Iraq or beyond?

No, something was at work here other than passive acquiescence. At precisely what moment during the years of Oil-for-Food did the UN Secretariat cross the line from "supervising" Saddam to collaborating with him? With precisely what deed did it enter into collusion? …

The final perfidy, though, is not personal but political. The UN, in the name of its own lofty principles, and to its rich emolument, actively helped sustain and protect a tyrant whose brutality and repression were the cause of Iraqi deprivation in the first place. What can this mean? The answer may be simply that, along with its secrecy, its massed cadres of bureaucrats beholden to the favor of the man at the top, its almost complete lack of accountability, external oversight, or the most elementary checks and balances, the UN suffers from an endemic affinity with anti-Western despots, and will turn a blind eye to the devil himself in order to keep them in power. Certainly there is much in its history and its behavior to support this view.

And is this the same United Nations that, now, we are planning to entrust with bringing democracy to Iraq?

To return to France and the attitude of its media and, indeed, its entire citizenry:

I cannot even start telling you how impressed I am with the French media for their legendary professional behaviour, i.e., their superhuman efforts to get to the bottom of that atrocious scandal: that Bush, Blair, and Aznar are liars and that they knew in no uncertain terms that there were no WMD in Iraq. All the while basking in the comforting knowledge that your ruling élite put France on the right side of history. I can imagine that the Russian press is showing the same signs of stirring valor, brave independence, and acute professionalism. Keep on the good work, les gars. Nous sommes fiers de vous! So proud of you! So proud of your integrity, which is second to none!

8 May 2004 (end of World War II anniversary)

© Erik Svane