Takes The Loaf
Business Partner Slices Up Iraq
by Greg Palast, GregPalast.com, December 8, 2003
Well, ho ho ho! It's an early Christmas for James Baker III.
All year the elves at his law firm, Baker Botts of Texas, have
been working day and night to prevent the families of the victims
of the September 11 attack from seeking information from Saudi
Arabia on the Kingdom's funding of Al Qaeda fronts.
It's tough work, but this week came the payoff when President
Bush appointed Baker, the firm's senior partner, to restructure
the debts of the nation of Iraq.
And who will net the big bucks under Jim Baker's plan? Answer:
his client, Saudi Arabia, which claims $30.7 billion due from
Iraq plus $12 billion in reparations from the First Gulf war.
Let's ponder what's going on here.
We are talking about something called "sovereign debt."
And unless George Bush has finally 'fessed up and named himself
Pasha of Iraq, he is not their sovereign. Mr. Bush has no authority
to seize control of that nation's assets nor its debts.
But our President is not going to let something as trivial as
international law stand in the way of a quick buck for Mr. Baker.
To get around the wee issue that Bush has no legal authority to
mess with Iraq's debt, the White House has crafted a neat little
subterfuge. The official press release says the President has
not appointed Mr. Baker. Rather Mr. Bush is "responding to
a request from the Iraqi Governing Council." That is, Bush
is acting on the authority of the puppet government he imposed
on Iraqis at gunpoint.
I will grant the Iraqi "government" has some knowledge
of international finance; its key member, Ahmed Chalabi, is a
convicted bank swindler.
The Bush team must see the other advantage in having the rump
rulers of Iraq pretend to choose Mr. Baker; the US Senate will
not have to review or confirm the appointment. If you remember,
Henry Kissinger ran away from the September 11 commission with
his consulting firm tucked between his legs after the Senate demanded
he reveal his client list. In the case of Jim Baker, who will
be acting as a de facto US Treasury secretary for international
affairs, our elected Congress will have no chance to ask him who
is paying his firm.… nor even require him to get off conflicting
This takes the Bush administration' Conflicts-R-Us appointments
process to a new low.
Or maybe there's no conflict at all. If you see Jim Baker's new
job as working not to protect a new Iraqi democracy but to protect
the loot of the old theocracy of Saudi Arabia, the conflict disappears.
Iraq's debt totals something on the order of $120 billion to $150
billion, depending on who's counting. And who's counting is very
Much of the so-called debt to Saudi Arabia was given to Saddam
Hussein to fight a proxy war for the Saudis against their hated
foe, the Shi'ia of Iran. And as disclosed by a former Saudi diplomat,
the kingdom's sheiks handed about $7 billion to Saddam under the
table in the 1980's to build an "Islamic bomb."
Should Iraqis today and those not yet born have to be put in a
debtor's prison to pay off the secret payouts to Saddam? James
Wolfensohn, president of the World Bank, says 'No!' Wolfensohn
has never been on my Christmas card list, but in this case he's
got it right: Iraq should simply cancel $120 billion in debt.
Normally, the World Bank is in charge of post-war debt restructuring.
That's why the official name of the World Bank is "International
Bank for Reconstruction and Development." This is the Bank's
expertise. Bush has rushed Baker in to pre-empt the debt write-off
the World Bank would certainly promote.
Why is our President so concerned with the wishes of Mr. Baker's
clientele? What does Bush owe Baker? Let me count the ways, beginning
with the 2000 election.
Just last week Baker said, "I fixed the election in Florida
for George Bush." That was the substance of his remarks to
an audience of Russian big wigs as reported to me by my somewhat
astonished colleagues at BBC television.
It was Baker, as consiglieri to the Bush family, who came up with
the strategy of maneuvering the 2000 Florida vote count into a
Supreme Court packed with politicos.
Baker's claim to have fixed the election was not a confession;
it was a boast. He meant to dazzle current and potential clients
about his Big In with the Big Boy in the White House. Baker's
firm is already a top player in the Great Game of seizing Caspian
Sea oil. (An executive of Exxon-Mobil, one of Baker Botts's clients,
has been charged with evading taxes on bribes paid in Kazakhstan.)
In The Family
Over the years, Jim Baker has taken responsibility for putting
bread on the Bush family table. As Senior Counsel to Carlyle,
the arms-dealing investment group, Baker arranged for the firm
to hire both President Bush 41 after he was booted from the White
House and President Bush 43 while his daddy was still in office.
Come to think of it, maybe I'm being a bit too dismissive of the
Iraqi make-believe government. After all, it's not as if George
Bush were elected by voters either. It would be more accurate
to say that TWO puppet governments have agreed to let the man
who has always pulled the strings come out from behind the curtain,
take a bow, take charge -- then take the money and run.