[Dialogue] Emailing: US Issues Threat to Iraq's $50bn Foreign Reserves in Military Deal - CommonDreams.org.htm
Harry Wainwright
h-wainwright at charter.net
Fri Jun 6 19:11:37 EDT 2008
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Published on Friday, June 6, 2008 by The Independent/UK
<http://www.independent.co.uk/news/world/middle-east/us-issues-threat-to-ira
qs-50bn-foreign-reserves-in-military-deal-841407.html>
US Issues Threat to Iraq’s $50bn Foreign Reserves in Military Deal
By Patrick Cockburn
The US is holding hostage some $50bn (£25bn) of Iraq’s money in the Federal
Reserve Bank of New York to pressure the Iraqi government into signing an
agreement seen by many Iraqis as prolonging the US occupation indefinitely,
according to information leaked to The Independent.
US negotiators are using the existence of $20bn in outstanding court
judgments against Iraq in the US, to pressure their Iraqi counterparts into
accepting the terms of the military deal, details of which were reported for
the first time in this newspaper yesterday.
Iraq’s foreign reserves are currently protected by a presidential order
giving them immunity from judicial attachment but the US side in the talks
has suggested that if the UN mandate, under which the money is held, lapses
and is not replaced by the new agreement, then Iraq’s funds would lose this
immunity. The cost to Iraq of this happening would be the immediate loss of
$20bn. The US is able to threaten Iraq with the loss of 40 per cent of its
foreign exchange reserves because Iraq’s independence is still limited by
the legacy of UN sanctions and restrictions imposed on Iraq since Saddam
Hussein invaded Kuwait in the 1990s. This means that Iraq is still
considered a threat to international security and stability under Chapter
Seven of the UN charter. The US negotiators say the price of Iraq escaping
Chapter Seven is to sign up to a new “strategic alliance” with the United
States.
The threat by the American side underlines the personal commitment of
President George Bush to pushing the new pact through by 31 July. Although
it is in reality a treaty between Iraq and the US, Mr Bush is describing it
as an alliance so he does not have to submit it for approval to the US
Senate.
Iraqi critics of the agreement say that it means Iraq will be a client state
in which the US will keep more than 50 military bases. American forces will
be able to carry out arrests of Iraqi citizens and conduct military
campaigns without consultation with the Iraqi government. American soldiers
and contractors will enjoy legal immunity.
The US had previously denied it wanted permanent bases in Iraq, but American
negotiators argue that so long as there is an Iraqi perimeter fence, even if
it is manned by only one Iraqi soldier, around a US installation, then Iraq
and not the US is in charge.
The US has security agreements with many countries, but none are occupied by
151,000 US soldiers as is Iraq. The US is not even willing to tell the
government in Baghdad what American forces are entering or leaving Iraq,
apparently because it fears the government will inform the Iranians, said an
Iraqi source.
The fact that Iraq’s financial reserves, increasing rapidly because of the
high price of oil, continue to be held in the Federal Reserve Bank of New
York is another legacy of international sanctions against Saddam Hussein.
Under the UN mandate, oil revenues must be placed in the Development Fund
for Iraq which is in the bank.
The funds are under the control of the Iraqi government, though the US
Treasury has strong influence on the form in which the reserves are held.
Iraqi officials say that, last year, they wanted to diversify their holdings
out of the dollar, as it depreciated, into other assets, such as the euro,
more likely to hold their value. This was vetoed by the US Treasury because
American officials feared it would show lack of confidence in the dollar.
Iraqi officials say the consequence of the American action was to lose Iraq
the equivalent of $5bn. Given intense American pressure on a weak Iraqi
government very dependent on US support, it is still probable that the
agreement will go through with only cosmetic changes. Grand Ayatollah Ali
al-Sistani, the immensely influential Shia cleric, could prevent the pact by
issuing a fatwa against it but has so far failed to do so.
The Grand Ayatollah met Abdul Aziz al-Hakim, the leader of the Islamic
Supreme Council of Iraq (ISCI), which is the main supporter of the Iraqi
government, earlier this week and did not condemn the agreement or call for
a referendum. He said, according to Mr Hakim, that it must guarantee Iraqi
national sovereignty, be transparent, command a national consensus and be
approved by the Iraqi parliament. Critics of the deal fear that the
government will sign the agreement, and parliament approve it, in return for
marginal concessions.
© 2008 The Independent
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5 Comments so far
1.
jesusofjonesboro June 6th, 2008 11:51 am
Well, if lies and murder aren’t beyond this administration then why
would we think that extortion would be?
The sad thing about Bush’s transparent attempt to skirt the Senate
on this issue is that this Supreme Court will let him get away with it.
Would somebody please kick Pelosi andReid in tha ass again - several
times?
jj
2.
Lord Trigo June 6th, 2008 12:26 pm
Aren’t the conditions in this “treaty” similar to the ones that led
us to kick the British out back in 1783? Anyhow, I’m sure the Iraqis will
find that life as a U.S. colony has a lot going for it. Just ask the people
of Okinawa.
3.
Leroy June 6th, 2008 3:26 pm
A quick read of the Declaration of Independence shows that Bush has
committed almost all the same crimes of which King George III was accused.
4.
elmysterio June 6th, 2008 4:05 pm
Leroy: History is just an endless cycle of powerful corrupt people
repeating the same crimes over and over again. Until we become more
enlightened as a species, we’re doomed to repeat history, albeit with minor
variations.
5.
bbr-001 June 6th, 2008 6:14 pm
The Iraqis need to stall and wait for Regime Change. Just a few
months.
Comparisons to the American Revolution exist, but this is more like
Japanese Imperialism circa 1930 -1940. Dubya is the weak and not too bright
“Emperor” being used as a front man for the MIC, and the public supports
military adventures so long as the economy grows and we win.
Oops! The economy is a mess, and the adventure has become a
quagmire.
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