The initiation of this program turned out to have many benefits for the Regime.
The program did achieve the higher objective of reducing the suffering of the Iraq population. However, it also had unanticipated collateral benefits for the regime.
First, there began a large flow of businessmen to Baghdad in search of contracts. While the UN held the checkbook, in effect, Baghdad still made the decisions on who would get the money. This provided a lever that empowered Saddam to reward or punish those seeking OFF contracts.
The flow of commerce expanded quickly to include the refurbishment of the decayed oil infrastructure. Baghdad shrewdly played various parties off against one another to win their favor. They made it clear that sanctions would not last forever, and when they were lifted, Baghdad would remember who their friends were. This attitude permeated all transactions and the attitude grew that sanctions were eroding and "everyone else" was making money. This effect was intangible, but powerful nonetheless.
The report describes the nature of income that Iraq was able to generate during this period. We broke them into largely four types:
Protocols with neighboring countries
Smuggling of oil products
Kickbacks associated with OFF contracts
Surcharges on oil exported through the
OFF program
The report describes in illustrative cases how transactions occurred, estimated their magnitude, and, more to the point of the report, where the funds were directed. It is shown, for example, that the budget of the Military Industrial Commission (MIC) surged from $7.8 million in 1998 to $350 million in 2001. In 2003 Iraq had budgeted $500 million for MIC. Saddam’s priorities were clear.
Nice Post
DANG .. FNC cut the hearing off