"Welt am Sonntag" (Germany): A Veto for Oil and Weapons.. Good Explanation of Financial Connections

"Welt am Sonntag" ^ | March 9, 2003 | "Welt am Sonntag" / Hans Krech and Heimo Schwilk

[tictoc]

Iraq has the second greatest occurrence of oil in the world with about 100 billion barrels. Added to that are significant natural gas stocks, which, until now, have hardly been exploited. The financial contracts alone for the reconstruction of the Iraq after the fall of the dictator will amount to about 200 billion dollars. Who will get these contracts is the reason the UN Security Council is presently fighting.

You know, while exposing the hypocrisy of the French and Russians -- but especially the French -- this article does raise some questions about US/British policy.

We know this isn't a war about oil, in the crude sense of the US going into Iraq in order to steal that country's oil. That would be colonialism, which has never been what the US is about.

But upon reading this article, which impresses me as well researched if all the facts are true, then one could be excused for wondering if France and Russia may not have a legitimate grievance after all.

This is hypothetical, of course, but what if one year ago, these two countries were told that in a reconstructed Iraq, Saddam's contracts with TotalFinaElf and Lukoil will be torn up, and Exxon and British Petroleum will be taking care of business? We don't know about negotiations behind the scenes but I have to assume there was some kind of haggling going on in the time between the unanimous adption of UN Resolution 1441, and the point in time where Paris and Moscow came out in public and committed themselves against war on Iraq. Now I'm not suggesting that France's $60 billion contract, reportedly three times the actual worth of the oil, should be honored to the letter; we all know that this was mostly a huge bribe in exchange for a promise to protect Saddam via the UN.

Still I wonder, did the US and the UK leave France and Russia no financial incentive at all to sign on to the anti-Saddam coalition? If so, then the anti-war Lefties, clueless morons though they are, may be onto something.

[longjack]

An Interesting perspective.

I am presuming, as you said, France and Russia were invited to sign on the the coalition. I would ask, in view of the approaches of Russia and France in the matter, why France is seeking to push the issue to the point of endangering the UN, NATO and the EU. Russia appears to be acting appropriately from it's side of the bargaining table, firm, but predictable. From France's perspective, threatening to upset the entire applecart indicates a weak bargaining position. Presuming that's the case, for argument's sake, why is their position is weak?

longjack

[tictoc]

I would guess that France's position is weak because the TotalFinaElf contract is a sweetheart deal that they could not expect a post-Saddam, democratic government to honor. And they have few options to hold on to that (reportedly) $60bn contract except if Saddam stays in power. (The value of the oil underlying the contract - again, reportedly, but I have not seen any French denial - is "only" $20bn.)

However, once it became crystal clear that Saddam is a goner no matter what, you might expect that the French government would retrench and say, Okay, You can take down Saddam if you'll let TotalFinaElf have a contract at "arm's length" conditions, i.e., for about $20bn. Then the U.S. agrees and everybody's happy.

But that isn't what has happened.

Let's ask zefrog to weigh in with his perspective.

[zefrog]

Let's ask zefrog to weigh in with his perspective.

Thank you. Frankly, the oil explanation for France's stance does not appear to make much sense: Total's deals cannot be exploited as long as Saddam stays in power and Iraq remains a pariah state. The only positive developement for Total's interests would be a regime change, and then France would ensure that the current deals are maintained with the new regime. The best and only way to achieve this would have been for France to support America all along the way and be rewarded in the end. What France has done the last few weeks is, in effect, turning America into a bitter foe, who will work hard to punish France and hence Total once this is over. Hence I am more than sceptical with this explanation.

[tictoc]

The best and only way to achieve this would have been for France to support America all along the way and be rewarded in the end.

Right. Now I'm only talking through my hat, and have no hard evidence at all on which to base my line of inquiry. But, if we assume for the sake of argument that the caricature of "Bush the Oil Man" has some basis in reality, then I could imagine a scenario in which the US administration played France "b*lls to the wall" and never really left open an option for France to preserve a reasonable financial interest in Iraq, and thus no option to climb down gracefully from its obstructionist stance.

It would have been an extremely aggressive policy for the US to pursue, and one that could have forced France into where it stands today. For this reason alone I do not consider it very likely that this is what happened, but stranger things are found in history books.

Note that I am not claiming that US/UK greed brought us to this point, but I would like to see some smart investigative journalists dig into this possibility.

(I hope I don't get banned from FreeRepublic now.)

[tictoc]

My scenario may be far-fetched, but I keep thinking there has to be an explanation for French actions that makes sense from a viewpoint of rational self-interest.

Neither Rhyme Nor Reason

[zefrog]

It would have been an extremely aggressive policy for the US to pursue, and one that could have forced France into where it stands today. For this reason alone I do not consider it very likely that this is what happened, but stranger things are found in history books.

Well, it is a reasonable possibility. I've heard many french officials saying in private the following:

- We have absolutely no interest in going along with the US since they are hostile to our interests anyway, no matter what we say or do.

- We don't give a damn about destroying NATO, its members are just puppets of the US anyway.

- If there is a major crisis in the UN each time other members oppose the US, it just means that the UN resolutions cannot be anything else than administrative formalities whose only purposes are to validate USian policies. In this case, the UN is de facto already irrelevant, and we don't have much to lose if the US leaves. Plus, if that happens, the US will look like the evil unilateralists and we might even gain a maximum leverage in the UN.

[Hillarys Gate Cult]

I have another couple of reasons of why France and Germany are against us. One is that most backdoor deals for banned equipment Iraq had with their countries will come to light. Saddam sure isn't going to cover their rear ends on this one. Another is that as long as French and German leaders can keep stirring up anti American hate, they don't have to worry about having much pressure from their own people to solve their country's problems like high unemployment. Distraction politics taken to the tenth power.

[12B]

Wahnsinn!!

I can't believe this appeared in the German press.

Gut gemacht LongJack. Ich gratuliere.

[tictoc]

Bump for the article and translation.

[marron]

I remember earlier on that Putin was being publicly very supportive, and the Russian press quite explicitly stated that it was about money, and it was in their interest to support the US in Iraq. Russian oil companies were pushing Putin to support the US. I saw reports at the time that suggested that they were looking for a promise that their concessions would be respected. During that same time, Saddam reacted quite angrily and threatened to kick the Russians out for dealing with the US.

It was about that time that the Russians began to move away from our position publicly. I don't know if this is inter-related, but it could be. Press reports at the time indicated that they wanted their concessions to be honored, we were promising them only that they would get a fair shake after the war.

Similarly the French wanted the same promises, and did not get them. I think our position was that these concessions were obtained in the face of sanctions, and should not be respected. But, if they would support us, they would get a fair chance.

The problem with honoring their concessions, beside the fact that they were ill-gotten to begin with, was that they were really quite exagerated in value.

Chirac of course supposedly has a very close relationship going back 25 years, supposedly according to articles I have seen here on FR Saddam financed his first run for office years ago, maybe all of his campaigns. They are supposedly very close. So Chirac isn't going to go against Saddam no matter; it is possible that he really can't.

The US was invited into Saddam's oil fields at the end of the Iran Iraq war. We lost that invitation by backing Kuwait in the war. I almost suspect that we had a crisis of conscience behind the scenes, that we were trying to have it both ways, and perhaps reluctantly sided against him, and it may well be that this played a part.

But we did give up a lucrative business deal for strategic reasons. We could easily have traded an end to sanctions at any time for concessions, if that were what we were about.

You will also notice that our northern "no-fly" zone leaves the Kurdish oil fields in Saddam's hands. If it were about oil, for us, we could have easily occupied the no-fly zones instead of simply patrolling them by air. In my opinion, for humanitarian reasons, we should have.

It does seem that the French and Russians have tried to strike a deal with us on the oil fields, and that we have rebuffed them, and now we are paying a price politically. But if we hold to our guns, we will owe them nothing afterward, and perhaps better yet, the Iraqis will owe them nothing.

[americanbychoice]

Hi tictoc.
I still believe that the French and Germans are gambling right now for a greater cause.
Gamble # 1, Veto the vote, hoping that they can avert action in Iraq in order to maintain that cash cow together with Russia.
Gamble # 2, This one will make more sense. Collaborate with Germany, which was done already to show the prospective EU members that a United Europe is again a World power in order to entice them to adopt D'estaign's EU constitution. It will be a hard sell if it is maintained in it's present form. The Gamble is that either it will be adopted, or there will only be a handful of coutries left. In it's present form, a nations soveirnity will be taken away and appointed Buerocrats in brussels will determine everything from taxes to education, to defense, etc. That is the real power game in their mind. Add Russia, who will probably be granted admission into the Union. Together, they believe that it will offer a real opposition to the U.S. Infact, it will have the old Warsau pact nations together with Europe as a united front. A gamble, which may pay off.
Of course, that's just my opinion. I could be wrong.

[tictoc]

Thank you.

Oh to have been a fly on the wall during those backroom discussions!

It will all come out eventually, but we'll probably have to wait a few years for the book.

[tictoc]

You may be right as far as France is concerned.

As for Germany, I have my doubts, simply because Schroeder has never had any long-term vision. I don't think he is capable of thinking through a machiavellistic geopolitical plan.

[americanbychoice]

I agree with you on that evaluation of Schroeder. But look at the time lines. Collaboration with France like never before. He knows that Chirac is a better diplomat. Schroeder has been duped several times already, just look at his acricultural discussions. Why doesn't the Media print anything about the new constitution due in June? Just the English have made some noise about it. To me it is very unsettling. I may be wrong.

[Chances Are]

Well, Marron, that is a very good analysis. I'm especially in agreement with your conclusion. Walking this walk will be a bit tricky, but the only way the Obstructors can profit is by a maintenance of the status quo. For my part, I offer up the following:

It is interesting to note that the current crisis seems to have brought many an established international institution to a rather parlous state. If I didn't know any better, I'd almost say it was by design, like some one or some group, who we can't see, is calling the shots on this.

Take, for example, the current brouhaha at the UN. All at once, as if by magic, there appears from nowhere substantial and vociferous oppostion to a course of action everyone had previously agreed to! And in response, the administration, determined as much as anyone ever has been to go to war, seems increasingly content to give this organization the necessary rope with which to hang itself, as it appears it most likely will do.

And then there is the quixotic turn of events at NATO. Now, ordinarily in a situation like this (1) France wouldn't even bother to be involved, because it's not, and has not for a long time, been part and parcel of NATO day-to-day goings-on; and (2) even if they had, we'd ordinarily tell them to sod off.

However, that hasn't happened. I can countenance an attempt by the Germans to oppose, at least initially, the efforts in Turkey, but in the absence of French posturing they would simply be shouted down, or worse yet, ignored.

Then, too, there is the question of political partitioning of the EU because of this issue. Is the war as an issue bigger than the viability of the EU as an issue? Is it worth berating and belittling the newcomers, getting the expanded union off on the wrong foot, just so France can appear to be leading other European nations around by the nose? Can the schism that is being created between Old Europe and New Europe be worth the price, the renting asunder of the Grand Union that the EU pretends to be?

Of course, when it comes to the French shooting themselves in the foot, anything is possible. They have a grand and glorious past in this regard, so let's not sell them short.

Actually, in an historical sense, if Europe is left to it's own devices this is what they invariably do. There are people over there who can see things differently, and know that the short term expedient is no substitute for a long-term coherent view, but typically their voices are drowned out, primarily because there aren't enough of them.

For the nonce we must stay on plan. If the UN dies (i.e., becomes the reincarnation of the League of Nations), then so be it. If NATO collapses, then we'll have to find something to replace it, or better yet, determine if in fact it does need replacing. The EU? Really, who gives a s***? This union wasn't going to work anyway, let's not kid ourselves. If the dream (of some) of a pan-European entity is to work, they'll have to find some way of overcoming hundreds of years of European history. If they're going to fracture over an issue like the US going to war with a middle eastern dictator, they're going to have a very hard time in the future seeking and stressing commonalities. Apart from being on the continent, what do the Spanish have in common with the Poles, who have what in common with the Bulgarians, who have....well, you get the drift.

Back in the 80's, there was a small book out called "Last Waltz of the Tyrants". Well, we're not there yet. We may in fact be a long ways from that exalted state. But if war is the continuation of politics by other means, then the new paradigm of 21st Century warfare demands a parallel development of 21st Century political thought, and we simply aren't going to get that by relying on institutions that seem to have outlived their usefulness.

CA....

[Michael81Dus]

"I am glad to see the German public at least has the opportunity to be informed as to what is behind the Axis of Weasels."

It is so easy to follow the simple thoughts than to think more - or to read some more lines than the usual fat letters on the first page. Die Welt is my favourite national newspaper, but it´s read by those who usually think more than the others.

[marron]

then the new paradigm of 21st Century warfare demands a parallel development of 21st Century political thought, and we simply aren't going to get that by relying on institutions that seem to have outlived their usefulness.

I agree.

[Chi-townChief]

You're still here - "Oil for food" seems to be the answer.