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Secret Bechtel Documents Reveal
Yes, It Is About Oil
by David Lindorff
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Is the war against Iraq all about oil? Not to hear Defense Secretary
Donald Rumsfeld tell it. Back on Nov. 15, he called the notion that
oil was the real reason behind the Bush administration's drive against
Saddam Hussein "nonsense," saying, "It has nothing to do with oil,
literally nothing to do with oil."
But a new study released by the Institute for Policy Studies, based
upon secret diplomatic cables just declassified by the National
Archives, and internal communications of the Bechtel Corporation,
suggests just the opposite that oil is the underlying cause of this
war.
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The study, which discloses the intimate links between the Bechtel
Corporation and Bechtel executives and U.S. policy towards Iraq, also
shows that some key players in the push for America's war against
Iraq, including Rumsfeld, Vice President Dick Cheney, and other former
Reagan administration officials Roger Robinson, Judge William B. Clark
and Robert McFarlane, have been intimately involved in issues relating
to Iraqi oil as far back as the1980s.
Titled Crude Vision: How Oil Interests Obscured US Government Focus
on Chemical Weapons Use by Saddam Hussein, this report traces an
intense effort by Reagan officials in the mid-OE80s to win Hussein's
approval for a $2-billion oil pipeline to be built by Bechtel, running
from the Euphrates oilfields in southern Iraq westward to Jordan and
the Gulf of Aqaba.
A key player in that effort was Rumsfeld, then the CEO of Searle
drugs, the giant phramaceutical company.
One particularly revealing 1983 memo, declassified for the first time
in February by the National Archives, concerns a trip by Rumsfeld to
Iraq. Acting as a special White House "peace envoy" allegedly to
discuss with Hussein and then foreign minister Tarik Aziz the bloody
war between Iran and Iraq, Rumsfeld turns out according to this memo
to have been talking not about that war, but about Bechtel's proposed
Aqaba pipeline.
In his memo to Secretary of State George Schultz reporting on the
meeting with Hussein, Rumsfeld talks at length about the pipeline
discussion, but makes no mention of having discussed either the war or
charges that Hussein's army was using chemical weapons against the
Iranians.
The intense focus of Rumsfeld, Schultz (a former president of
Bechtel), Cheney and other Reagan officials, in concert with Bechtel,
on the pipeline, reads like an abbreviated, or mini "Pentagon Papers",
laying the groundwork for a collapse in relations between the U.S. and
Iraq, and eventually to
war. The documents also cast Bechtel's current position as one of two
top candidates for the lucrative contract to "rebuild Iraq" in a
troubling light.
As American troops press into Baghdad, and Iraqi casualties run into
the thousands, David Lindorff speaks with Jim Valette, director of
research at the Sustainable Energy and Economy Network, and one of the
three authors of Crude Vision.
Q: What prompted this study?
A: We were examing the interconnections between private corporations
and the U.S. government in the pursuit of oil worldwide since
1995 - principally the U.S. financing - through the World Bank and US
agencies like the Export-Import Bank and the Overseas Private
Investment Corporation (OPIC), etc.?of that pursuit. But what has
clearly occurred in recent months has been clearly an even more
serious expression of this pursuit of fossil fuels for the benefit of
Big Oil, which is an extention of this relation into the military
role. And so we're looking at the deployment of troops and
paramilitaries financed by the U.S. government worldwide, and of
course the most serious conflict of interest is in Iraq. In the course
of that research we saw the beginning and end of the story of American
efforts to gain control of Iraq's oilfields, the beginning being
Rumsfeld's meeting with Saddam Hussein in Deecemer 1983 to the end,
which was the Independent Counsel's investigation of the Attorney
General, at the time, Edwin Meese, and his relationship with one of
the brokers of the pipeline, E Robert Wallachs. Before this nobody had
connected the dots between Rumsfeld and the Meese investigation and
nobody had examined exactly how dominant this pipeline project was in
the diplomacy and the burgeoning relationship between the Reagan
administration and Saddam Hussein. It was in that context that we came
across corporate records and government memoranda related to the Aqaba
pipeline project. It was a real eye-opener to us to see how interwomen
Bechtel's interests were with the Reagan Administration.
Q: We're talking about stuff that happened almost 20 years ago. How is
this relevant to what's happening in Iraq now?
A: This story, I think, is timely even though it's 20 years old
because Bechtel is back now, as the likely winner of the contract to
rebuild Iraq's infrastructure, and many of those Reagan administration
officials are back, and they are poised to get their hands on Iraq's
oil again.
Q: So what is new here?
A: The release in February by the National Archives of cables back and
forth between Washington and U.S. diplomats in the Middle East around
the time of 1983 and 1984 disclose for the first time what really
transpired in Rumsfeld's meetings with Saddam and other Iraqi
officials. What had previously been reported was that Rumsfeld had a
cozy meeting with Saddam in Baghdad in December 1983. In the past, the
focus was on whether or not he had raised the issue of Saddam's use of
chemical arms against Iran. But what the actual memoranda show is that
a big part of Rumsfeld's discussion with Saddam Hussein was this new
proposal from Bechtel to build a pipeline form Iraq to Jordan. I mean
Rumsfeld was executing the marching
orders of George Schultz, who was the Secretary of State, but who came
directly from the presidency of Bechtel to the Reagan administration.
The documents released by the National Security Archive suggest that
what was going on then had quite a bit to do with oil - certainly more
than had been known before.
Q: Before the release of those documents we didn't know that Rumsfeld
was talking about a pipeline?
A: Right. Right. I mean it was reported that when he was there he
didn't raise an issue with Saddam about the use of chemical weapons,
even though there were reports coming out of Iran that Saddam was
dropping chemical bombs on Iranian troops.
Q: So we knew before what he didn't talk about, but not what he was
talking about?and that was the pipeline?
A: Right, he was there sort of as a bagman for Bechtel. And then
there were documents I found in the government's National Archives
that showed the extensive involvement of Reagan officials and the very
close relationship they had with Bechtel officials, in pursuing this
pipeline over the next two years. We sort of connected the dots
between what was in these National Security Archives and what was
known in the general coverage over the last 15 years.
Q: How important was this pipeline in terms of u.s.-iraqi relations?
A: It was the focus of U.S. relations with Iraq for several years,
right through the period that Iraq was locked in a bitter war with
Iran. In one 1984 internal company memo, Bechtel executive H. B. Scott
exhorts his colleagues at Bechtel, after it appeared that all this
diplomacy by Rumsfeld seemed to be paying off, "I cannot emphasise
enough the need for maximum
Bechtel management effort at all levels of the U.S. government and
industry to support this project. It has significant political
overtones. The time may be ripe for this project to move promptly with
very significant rewards to Bechtel for having made it possible." And
in these documents we see how tightly interwoven this management
effort is with their former colleagues such as George Schultz in the
State Department in implementing this initiative. It shows how
corporations take advantage of U.S. geopolitics in the region and how
they try to profit from those geopolitical developments. Another
important memo was in July of 1985, after Bechtel had run into some
difficulties in assuaging Saddam's fears about potential Israeli
threats to the pipeline. Bechtel and the State Department were having
trouble getting the right degree of assurance from the Isreaeli Labor
Party [then the ruling party in Israwl] that the pipeline would be off
limits to attack. Bechtel and the Reagan administration officials were
trying to get absolute assurance from the Labor Party that the
pipeline would absolutely not be
attacked. There were some frustrations to that approach in 1985, and
so Bechtel hired a couple of very close friends of the Reagan
administration to sort out the deal. In July of 1985, pipeline
promoters hired Judge Jim Clark, who was considered Reagan's right
hand man. He had just left government to go into private business.
There's a memo from Judge Clark saying that he's "on board" and laying
out the terms of his involvement, which were $500 an hour, and saying
he'd be flying to Baghdad, not as a private consultant, but
representing himself as a White House representative. That memorandum,
which is avialable on our website
(www.gwu.edu/~nsarchiv/nsaebb/nsaebb82), shows how blurry that
revolving door had become. He's working for the government while he's
simultaneously getting paid as an agent for Bechtel.
Q: Okay, so we have the evidence that there was this big concern about
getting this big pipeline for Bechtel, and the interest in getting oil
out without it having to go through the Persian Gulf. But wasn't that
a legitimate national security concern for the U.S., given Iran's
political situation and its hostility towards America?
A: Well, it has been long-standing US national security policy on paper
that threats to the free flow of oil are threats to national security,
and this is what we're getting at here. Is this pursuit of oil or the
pursuit of empire? Some folks define what's going on in Iraq as U.S.
pursuit of empire, but right now it's really two sides of the same
coin. And this policy of pursuing oil and empire is coming up
against all sorts of realities
now that weren't well understood back in the 1980s. On the National
security side, this pursuit of oil wealth at all costs has huge costs
to democracy and human rights. It's creating a backlash in the Middle
East and elsewhere that has had some horrible expressions recently.
Q: The pipeline never got built though. What happened?
A: In the end, Saddam decided that Bechtel was trying to charge too
much for the project, and so he killed the project and instead went
with a pipeline connecting into pipelines in Turkey and into Saudi
Arabia, but avoiding the Straits of Hormuz.
Q: Do you expect to see the Aqaba pipeline revived?
A: Maybe, maybe not. I've seen reports now of Israel looking to build
a pipeline from Iraq to the Golan Heights. It's not the same project
as Bechtel's Aqaba pipeline idea. Bechtel asked the Commerce
Department to keep the Aqaba pipeline registered as an active project
for years, but it's probably less necessary now for the U.S. and
Bechtel. The pipelines to Saudi Arabia and Turkey give an alternative
route for oil to the Persian Gulf, and Bechtel gets into Iraq as a
contractor to rebuild Iraq after the war. Right now, according to an
article in the Wall Street Journal, Bechtel is one of the two
finalists for the Iraq reconstruction job, along with Parson's group,
which has Halliburton as a secondary contractor. Halliburton is Vice
President Cheney's former company [Note: Cheney is still receiving
payments from Halliburton]. That was reported in the Wall Street Journal today (April 2). They're both on the short list. Halliburton sort of
stepped back for obvious reasons but they1re still in there with
Parsons.
A: Aside from the unseemly picture of two well connected companies
getting an inside track for all that post-war business in Iraq, why do
you find the Bechtel involvement in this situation so troubling?
Q: Schultz worked at Bechtel. So did (Reagan Defense Secretary) Caspar
Weinberger. There were a lot of Bechtel people in the government in
the '80s at the same time that the Iraqi's were gassing the Iranis.
The same people are now formulating the plans for a coming U.S.
occupation of Iraq, and in turn, the same people will be given the
spoils of war - whether it's Parsons and Halliburton or Bechtel. It's
all kind of circular back to the 1980s, you know - completing
unfinished business - getting American companies back in there after
their being shut out since 1991 and the first Gulf War. Bechtel was
also listed by Iraq in its report to the U.N. weapons inspectors as
one of the companies that helped supply Saddam with equipment and
knowledge for making chemical weapons. Bechtel in the 1980s was prime
contractor on PC 1 and 2, two petrochemical plants constructed in Iraq
which had dual-use capacity. So I guess the bottom line is that the
Bush-Cheney-Rumsfeld squad are now holding Saddam Hussein accountable
for chemical weapons of mass destruction - the same weapons which these
same officials ignored in pursuit of the Aqaba pipeline project. And
now we are going to reward the pipeline promoter with massive
contracts for reconstruction resulting from this policy. There is just
such hypocricy in all this.
Q: This all seems like a kind of mini-Pentagon Papers, laying out the
early roots of this war.
A: It's not as much of a blue-print as was the Pentagon Papers, but
these memos and documents do show how business gets done in
Washington, how it was conducted in the 1980s and how it's probably
being conducted now behind closed doors under secret bidding
processes. And it shows how the origins of American conflict with Iraq
involve control of and access to oil.
Q: Can you see any signs that the current war is linked directly to
oil? I mean the administration has given so many reasons for going to
war I'm surprised they haven't gotten to oil. I remember in 1991, the
first Bush said it was about jobs, which equates pretty quickly to
oil. But they didn't say that this time around.
A: Yeah, they've redacted any reference to oil from their language.
Maybe that's the best evidence that that's what it's really about,
because it's logical. I mean Bush the first in his national security
papers defined the free flow of oil as a national security priority,
as did President Clinton in his final months in office. He released a
national security paper that said that the free flow of oil is a
national security priority that must be enforced with military might
if necessary. The current Bush came out with the national security
strategy that redacted this long-standing text dating back to the
Carter administration, but at the same time you had this Cheney energy
policy that continues this idea of the necessity of a "diverse and
free supply of oil" without the military language. And actually you
had Cheney kind of kick off the whole war fever last August in a
speech to the Veterans of Foreign Wars. He cited the specter of Saddam
Hussein with his weapons of mass destruction threatening the flow of
oil from the region. Then immediately afterwards, any kind of
reference like that vanished from the Bush administration's rhetoric,
to the point that Secretary of Defense Rumsfeld called any kind of
association of the current conflict with oil to be an "absurdity." So
there is no document or strategy paper now that says "we must invade
Iraq because our US oil companies have been shut out of this second
largest reservoir of oil for the last 20 years," but who knows what
we'll find in the National Archives 20 years from now? It's a
circumstantial case, but that's as good as we can do now. And logic
certainly has its place as well. I mean, the question is why are the
weapons of mass destruction today a cause for war when these very same
weapons were ignored by the same officials 20 years ago when they were
being used. What has changed is that other national oil
companies - French, Russian and Chinese - have gotten into Iraq, while
U.S. companies were being frozen out. I'm sure there are other
factors. Certainly the Kuwait invasion didn't help U.S relations with
Saddam, and since Kuwait, Saddam signed very lucrative oil contracts
with the French, Russians, Chinese and others.
Q: You made the point in your paper that US relations started to tank
with Iraq after the rejection of the oil pipeline.
A: That's true. There was a shift away from Iraq to Iran right at that
time, but I should say that Reagan and Bush the First both played both
sides of the fence for a while, even after the pipeline project
collapsed. You had the Iran Contra deal, but at the same time the U.S.
was providing Iraq with intelligence about Iranian troop movements.
And the U.S. did extend commodity credits through the Agriculture
Department that Saddam then parlayed into arms. And there were the
chemical plants that Bechtel helped build. So it's been quirkier than
that. But certainly the end of the pipeline destroyed oil relations.
Q: What do you think led to the current war. What's the oil link?
A: Look at what's in Iraq and what's undeveloped. Iraq represents a
major insurance package against any kind of political overhaul in
Saudi Arabia or problems elsewhere in the Middle East. Look at the
policy that people like Rumsfeld and others were recommending in the
1990s leading up to this war and they certainly cited the threat of
Saddam Hussein to regional oil supplies as a cause for war. Certainly
if the Bechtel pipeline had been built, the course of Iraqi-U.S.
relations would have been much different. The failure of that pipeline
set into motion a much different course for those relations.
A: So having control of Iraqi oil is still a key issue?
Q: It's the sole reason why the Persian Gulf region and Iraq have been
a United States national security concern for so long. It's not
geography.
Q: So what would you say is the lesson of all this?
A: The lesson is that when it comes to oil, a dictator is friendly to
the U.S. when he's willing to do business and he's a mortal enemy when
he's not. That has been the driving force behind national security
policy, especially since the fall of the Soviet Union. Oil and
national security policy were all submerged in the context of the Cold
War. But once that Cold War collapsed, now it's a no-holds-barred
battle for oil globally, and the U.S. has seen itself cut out of the
world's second largest reserve of oil - and oil that is very
inexpensive to extract. So with the U.S. shut out of Iraq, certainly
it makes the trigger fingers of U.S. policy-makers itchy. And whether
it's a blood feud or a war for oil, it's just a tragedy that the
people of Iraq and our own sons and daughters and brothers and sisters
are paying the price.
- – David Lindorff
This article was first run on CounterPunch, April 09 2003, as a Special Report.
Dave Lindorff
875 Welsh Rd.
Maple Glen, PA 19002
t: 215-793-9390 f: 215-793-9391
Dave Lindorff is the author of Killing Time: an Investigation into the
Death Row Case of Mumia Abu-Jamal. A collection of Lindorff's stories
can be found here: http://www.nwuphilly.org/dave.html
"Good writing should be organized."
Join the National Writers Union (UAW/AFL-CIO).
For information call: 212-254-0279 or see the NWU website.
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