Saddam's "Oil For Food Scandal"
Jude Wanniski
October 12, 2004


Memo To: Lou Dobbs, CNN
From: Jude Wanniski
Re: Is this really a scandal?

Dear Lou. As always, I tuned in to your CNN show last night and was interested to see that you had Claudia Rosett as a guest. The topic? The report by Charles Duelfer and his Iraqi Survey Group, which announced last week that Saddam Hussein destroyed all of his weapons of mass destruction and their programs in 1991. This is when the United Nations told him he had to do so if he wished the sanctions lifted so he could sell Iraqi oil again on the world markets. You didn’t ask Claudia about that part, but focused on her contention, and Duelfer’s, that Saddam was secretly manipulating the U.N.’s Oil For Food Program to buy illicit weapons with $11 billion he skimmed from the oil sales. Pretty damning charges have been made, implicating U.N. General Secretary Kofi Annan, several friendly foreign governments, and a whole bunch of oil companies. Claudia wants us to believe they are all true.

It sounded as if you bought her line, Lou, but if I were you I would take Claudia's report with a grain of salt. She not long ago left the Wall Street Journal editorial page, which you know has been promoting the war on Iraq forever, it seems, and now serves as a spokesperson for the Foundation for the Defense of Democracy, another in a long list of pro-war front organizations for Richard Perle, Jim Woolsey, Bill Kristol, and the rest of the neo-con Cabal. Go to their website and you will find the whole cast of characters listed. When you go to find who finances a considerable staff, including Claudia, they say only “individual philanthropists.” I’ll bet you a dollar the money comes from the military-industrial complex.

As for Duelfer, he was not asked to investigate the Oil For Food program, but I suggest he did so to steal the march on Paul Volcker's more serious investigation into allegations of improprieties in OFF. Volcker’s panel will not report until after the elections, probably not for several months. Please notice in your interview Claudia kissed off Volcker as a foot-dragger.

You should, I hope, keep an open mind on the possibility that the U.N. operated properly... and that Saddam's "kickbacks" were not going into his pocket or a Swiss bank account -- as the neo-con propagandists have argued. The funds went into the Baghdad Treasury as TAX revenues, which I assume the Volcker Commission will report. Some of the $11 billion over several years that you mention are estimates of the "illegal" sale of oil owned by Iraq to foreign customers, i.e., Jordan and Turkey. We knew about the sales, Lou, but said nothing, because Jordan and Turkey are "allies" who needed oil.

Charles Duelfer, appointed to head the ISG after David Kay left, having found no WMD, clearly used the OFF program to distract attention from his central finding that was the same as Kay’s. He could hardly cite WMD discoveries when none existed, so he built a thesis into his report that Saddam someday wanted to rebuild his WMD capabilities and was using the OFF program to that end, with the complicity of the French, Russians, Chinese, United Nations, and major oil companies. Logic should tell you, though, that the neo-cons have been behind this hoax from the start, that they never intended to lift the sanctions on Iraq even while knowing back in 1991 that Saddam almost certainly had complied with that first U.N. resolution. On the back of an envelope, I reckoned that if the sanctions had been lifted in 1991 (when they should have been lifted), Iraq would have earned enormous amounts of money from the sale of their oil. At an average of $10 bbl over 14 years, they would have collected $126 billion. At a more reasonable average over the period of $15 to $20, the Iraqi government would have been able to pay all its creditors and at the same time enable the Iraqi people to return to the high living standards they enjoyed before the Iran-Iraq war (during which, you will recall, we supported Saddam).

The only reason I make these observations, Lou, is because all the Iraqis who are in a position to address these issues from the inside are in custody and cannot talk. The corruption stuff is coming from the Iraqi exiles. Every time the issue is mentioned they mention Saddam building sumptuous "palaces." I doubt more than a few hundred thousand dollars (in dinars) were spent on "palaces." In case you did not know, "palaces" is a loose term for government compounds, many of them bombed from time to time by our Air Force in the hopes of killing Saddam.

Of course you and readers of this open memo can go on the Internet and easily find the entire Duelfer report, but here is the section described as “key findings.” Read it from the perspective I suggest and may see as I do that the neo-cons have sent this nice lady I’ve known for many years, Claudia Rosett, to con you and your audience the way I believe they conned President Bush. I still don’t believe the President would ever have gone to war if he knew how he had been manipulated by the Perle Cabal. He is never going to be able to admit that to himself now. Human nature does not work that way. To admit error to himself of this magnitude would be too hard for his soul to bear. But you, Lou Dobbs, are still in a position to separate the wheat from the chaff and to do so as a journalist of the front rank. It may make a difference, if you do, on how history unfolds from here.