James Baker's Billion-Dollar Scam as 'Special Envoy' re Iraq

[lostnfound]

What ought to be common knowledge isn't, or James Baker would be skating on thin ice on charges of treason and fraud. I hope everyone at DU is aware of the ground-breaking report by Naomi Klein in the November 2004 issue of the Nation, that Baker was trying to convert the power of the US government into $1 billion of Saudi money for his very own Carlyle group. At that very minute he was trying to use the leverage of his role as "special envoy" of the United States in charge of negotiating away Iraq's debt, where he was meeting with heads of state in order to persuade them to forgive the debts owed to them by Iraq, to persuade the Saudis to invest $2 billion in a private consortium which would in turn invest $1 billion in the Carlyle Group. The deal was actually in the works while Klein was reporting on it, and likely, her report stopped the deal in its tracks.

At stake -- Baker's leverage -- was $57 billion in unpaid Iraq debt to Kuwait. If Kuwait said 'No', they would be dealing with Baker. If Kuwait said 'Yes', they would be dealing with Baker. Should we call it extortion or simple bribery?

James Baker's Double Life: A Special Investigation
http://www.thenation.com/doc/20041101/klein

When President Bush appointed former Secretary of State James Baker III as his envoy on Iraq's debt on December 5, 2003, he called Baker's job "a noble mission." At the time, there was widespread concern about whether Baker's extensive business dealings in the Middle East would compromise that mission, which is to meet with heads of state and persuade them to forgive the debts owed to them by Iraq. Of particular concern was his relationship with merchant bank and defense contractor the Carlyle Group, where Baker is senior counselor and an equity partner with an estimated $180 million stake.

Until now, there has been no concrete evidence that Baker's loyalties are split, or that his power as Special Presidential Envoy--an unpaid position--has been used to benefit any of his corporate clients or employers. But according to documents obtained by The Nation, that is precisely what has happened. Carlyle has sought to secure an extraordinary $1 billion investment from the Kuwaiti government, with Baker's influence as debt envoy being used as a crucial lever.

The secret deal involves a complex transaction to transfer ownership of as much as $57 billion in unpaid Iraqi debts. The debts, now owed to the government of Kuwait, would be assigned to a foundation created and controlled by a consortium in which the key players are the Carlyle Group, the Albright Group (headed by another former Secretary of State, Madeleine Albright) and several other well-connected firms. Under the deal, the government of Kuwait would also give the consortium $2 billion up front to invest in a private equity fund devised by the consortium, with half of it going to Carlyle.

The Nation has obtained a copy of the confidential sixty-five-page "Proposal to Assist the Government of Kuwait in Protecting and Realizing Claims Against Iraq," sent in January from the consortium to Kuwait's foreign ministry, as well as letters back and forth between the two parties. In a letter dated August 6, 2004, the consortium informed Kuwait's foreign ministry that the country's unpaid debts from Iraq "are in imminent jeopardy." World opinion is turning in favor of debt forgiveness, another letter warned, as evidenced by "President Bush's appointment...of former Secretary of State James Baker as his envoy to negotiate Iraqi debt relief." The consortium's proposal spells out the threat: Not only is Kuwait unlikely to see any of its $30 billion from Iraq in sovereign debt, but the $27 billion in war reparations that Iraq owes to Kuwait from Saddam Hussein's 1990 invasion "may well be a casualty of this U.S. effort."

Educate. Enlighten. Take away the innocence of those who can't imagine how deeply greedy the smooth-talking allies of the Bush family can be. They know about the Carlyle group from Fahrenheit 9-11, but most people don't know about this.

[havocmom]

1. .

[Hubert Flottz]

2. 2.

[goclark]

3. Baker is a big snake in the grass of Poppy

[rodeodance]

6. Poppy no doubt gets a cut.

[goclark]

10. And Poppy cries and says he doesn't run the WH

He LIES!

As always, Poppy is placing his army behind the scenes and crying about his darling boys. :puke:

[TomInTib]

12. It is really the other way around

ghwb is actually just a tool of the Baker Bunch.

It has always been that way.

Baker is vastly more powerful than Poppy.

[goclark]

18. Has anyone seen Octafish lately? nt

[annabanana]

4. ugh

The fact that many are relying on this guy's Iraq Study Group to keep jr. from running off a cliff is disturbing in so many ways.

[Reterr]

5. Thats true.eom

[Turbineguy]

7. So we are once again

caught between a rock and a hard place.

Between Dubja and Uncle Jimmy, Uncle Jim is the lesser of two evils. Since Dubja will have cost this nation TRILLIONS, a mere billion is chump change.

[lostnfound]

20. I understand your reasoning but I'm not sure that

any of what is being portrayed as a rift is real. It may be made-for-TV. Who knows? All I know is that the Baker report has succeeded in replacing a Democrat-vs-Republican debate about the war with a largely Republican-vs-Republican "debate" about the war on the news channels.

His role is to enrich himself and his allies; the Bush family has always been an ally. I seriously doubt that whatever "alternatives" he is suggesting represent any departure from that goal.

[The Count]

8. Defanding Saudis agaist 911 families, stealing the 2000 election - just making

sure all highlights of his resume are kept in focus.

[acmavm]

9. The old fixer has always been a criminal. Always. And he's

never really given a damn whether anyone knew it or not.

Money is the way these people deal with their consciences. The more they get, the less they care. Unless like blivet they didn't give a damn in the first place.

[cassiepriam]

11. For the love of God, is everything about vast riches for themselves?

They are so sick, all of them.

[spanone]

13. I'm beginning to think this whole ISG commission is a scam.

[flyarm]

14. i posted this on nov 11th here at du...here is the link.......

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=364&topic_id=2681709&mesg_id=2690835

thanks for posting it again!! important info!!

fly

[lostnfound]

21. Sorry I missed it, and you're welcome. nt

[Gregorian]

15. Do I understand this correctly?

Is this situation one in which Baker is going to these debtees knowing full well that we are about to blow Iraq to smithereens? Was this his way of ensuring that the debt would not ultimately be deducted from our bank account once we "owned" Iraq?

[flyarm]

17. I BELIEVE bAKER WILL BE IN FRONT OF WAXMAN WITH

alot of "splain'in".. to do!!

and i hope Waxman wears his lying ass off..then hauls him off to the nearest federal prison!

for treason!!

fly

[conscious evolution]

25. You are right on that.

Other posters here on DU have said that Baker has walked into a trap on some issues and Waxman is ready to spring it on the whole lot of them.

See the CorpGovActivist and IdesofOctober journals for some head spinning information on whats in store for the bush gang.

[lostnfound]

19. No, this was long after the invasion.

This was under the pretext of negotiating the Iraqi debt down supposedly for the sake of the Iraqis to put their economy and their government on sound footing.

[Gregorian]

31. I am still confused.

I've learned that if I don't ask, at the risk of looking stupid, I'll remain stupid.

I really don't understand what the crime is here. I'm asking for an explanation, I suppose.

It still seems like the same as my reply in that he did it to make Iraq less debt ridden, so when we "own" them, we'll be free of debt???

[lostnfound]

32. It's a massive conflict of interest, to say the least, and essentially a kickback

His assigned task as envoy was to REDUCE Iraq's debt to Kuwait -- i.e., to get Kuwait to "write down" or "write off" the debt.

Kuwait obviously doesn't want to "write down" or "write off" the debt, and would prefer that it be paid in full.

Baker's attempt at getting a $2 Billion investment from Kuwait can be seen as an attempt to extort money out of Kuwait in exchange for Kuwait getting favorable treatment by Baker in his role as a debt middleman -- backed by the full force of the U.S. government and its many avenues of applying pressure.

[leftofthedial]

16. this is a criminal enterprise

period.

until it is reined in and eliminated, we all will continue to be its victims. They've stolen trillions over the past 25 years. Imagine this world with a trillion dollars or more to be used constructively instead of to enrich criminals. Imagine this world without the corruption, pointless wars, chaos, drug running, lies and corrosive destruction of our democracy that the bush cabal has given us.

[Joe Chi Minh]

22. I remember a fascinating article by Naomi Klein in Common Dreams,

about how the neocon dunderheads were intent on setting up a national, ultra-capitalist economy from scratch in Iraq; a kind of laboratory in which to test their far-right economic theories by putting them into practice.


When imams complained about the Nazi-like seizure of public corporations to turn them into capitalist, doubtless American-owned corporations, mysterious bomb blasts occurred in the imams' mosques. This was before the sectarian warfare really got going.

However, as always, when such ventures fail, the far right go back to the tried and tested plundering of their own people. As Wedgewood Benn put it, the working class are the last of the colonies (which now means preety much anyone with an income below theirs).

[many a good man]

23. Baghdad Year Zero

http://www.commondreams.org/views04/0924-13.htm

But Bremer’s economic engineering had only just begun. In September, to entice foreign investors to come to Iraq, he enacted a radical set of laws unprecedented in their generosity to multinational corporations. There was Order 37, which lowered Iraq’s corporate tax rate from roughly 40 percent to a flat 15 percent. There was Order 39, which allowed foreign companies to own 100 percent of Iraqi assets outside of the natural-resource sector. Even better, investors could take 100 percent of the profits they made in Iraq out of the country; they would not be required to reinvest and they would not be taxed. Under Order 39, they could sign leases and contracts that would last for forty years. Order 40 welcomed foreign banks to Iraq under the same favorable terms. All that remained of Saddam Hussein’s economic policies was a law restricting trade unions and collective bargaining.

[lostnfound]

28. Naomi Klein is so smart.. I'm so glad she's on our side

I don't mean just 'Democrat'; I mean 'in search and struggle for a better world'.

[Joe Chi Minh]

30. Thanks for that, Torches and Pitchforks. That would eptiomise it,

I dare say.

[shance]

24. What people also don't realize is these are the individuals who own the media.

Over the years, they, along with their friends, have confiscated almost every thread of the media, even parts of Pacifica and NPR (via the Ford Foundation), to where the Bush/Baker/Carlyle team wrests virtually all control of what is sent out over the air waves.

[thingfisher]

26. Has anyone else noticed NPR and NPT

plugging their "balanced" approach of late?

[thingfisher]

27. Another crime to add to Mr. Bakers already long list of offences,

[The Backlash Cometh]

29. Our country has been taken over by scam artists.

[LSK]

33. I am not understanding something

Iraq owes Kuwait $57 billion. So why would Kuwait give Carlyse $1billion??? I dont understand how they are related?

[lostnfound]

34. It's a kickback and a major conflict of interest for Baker

His assigned task as envoy was to REDUCE Iraq's debt to Kuwait -- i.e., to get Kuwait to "write down" or "write off" the debt.

Kuwait obviously doesn't want to "write down" or "write off" the debt, and would prefer that it be paid in full.

Baker's attempt at getting a $2 Billion investment from Kuwait can be seen as an attempt to extort money out of Kuwait in exchange for Kuwait getting favorable treatment by Baker in his role as a debt middleman -- backed by the full force of the U.S. government and its many avenues of applying pressure. Kuwait would be buying Baker's loyalty (an oxymoron, I'm sure) in the deal.

When it happens in business it's considered a kickback and the culprits end up in jail.

When it happens on the world stage it should be considered treason.

[LSK]

35. but from Kuwaits point of view, why would they want to do either?

[lostnfound]

36. The US government has the ability to put intense pressure on Kuwait

Baker carried with him the full power and backing of the US president.

They don't want to do either, but they would have had no choice. Baker was giving them an offer they couldn't refuse.