In this issue:

Retired U.S. General: Iran War Would Be a Disaster

Strong Reactions to Hamas Victory After Landslide Shock

Hamas Victory Signals Alliance with Fatah Young Guard

Cheney Peddles 'New Baghdad Pact' Scam in Cairo, Riyadh

Iran Plans To Establish Oil Market

Audit Finds More Fraud and Waste in Iraq Contracting

From Volume 5, Issue Number 5 of EIR Online, Published Jan. 31, 2006
Southwest Asia News Digest

Retired U.S. General: Iran War Would Be a Disaster

Edward Atkeson, former Deputy Chief of Staff of the U.S. Army in Europe, warned in an interview with the German daily Koelner Stadt-Anzeiger Jan. 27, that a U.S. war against Iran would be a "deadly serious matter." (Quotes back-translated from German.)

An air attack on Iran would not succeed, and could not destroy all sites relevant to nuclear weapons production, he said. "We would simply create a tremendous uproar, and strengthen the opposition to U.S. policies in Iran, in the Middle East, and indeed in many parts of the world." To supplement air strikes with special forces deployments would not increase the chances of success, but only increase the risks.

"Whoever wants to use military means to keep Iran from gaining atomic weapons, will have to be prepared for a war. We are talking about a real, great war, not an intervention à la Kosovo."

Although the first strike might be a surprise, the war would not be over in an hour. "One must therefore take into account, that U.S. forces are deployed in Iraq and Afghanistan, right on the border. They would be absolutely insufficient for a war against Iran. The USA would have to introduce the draft...." He added that NATO is not going to commit troops unless Iran launches a direct attack on Europeans.

Strong Reactions to Hamas Victory After Landslide Shock

The victory of Hamas in the Palestinian parliamentary elections, first and foremost, points out the total failure of the Cheney-Bush policy in the Middle East, and confirms the many warnings that the Palestinian population has been turned against the United States because of its Middle East policies. Here are some of the major reactions and developments immediately after the Jan. 25 election.

  •  Palestinian President Abu Mazen has asked Hamas to form a government after the party won 77 seats in the parliament. Former U.S. President Jimmy Carter called the Palestinian elections totally fair and open.
  •  Israeli peace movement leader Uri Avnery says dialogue must open with Hamas. The future depends on both Israel and Hamas. "The crucial choice: deterioration and ever more bloodshed, or the opening towards a firm peace of which Hamas is a part. Avnery said that the Israeli government refused every opportunity to negotiate for peace with Abu Mazen and Fatah, but that is now "spilled milk." These were fair, democratic elections, and the situation cannot be allowed to deteriorate.
  •  Israeli rightwing fanatic Effie Eitan of the National Religious Party called for assassinating all Hamas Parliamentarians, and Likud boss Benjamin Netanyahu wants an Afghanistan-type war against what he called "Hamastan."

Hamas Victory Signals Alliance with Fatah Young Guard

A senior British intelligence source told EIR Jan. 26 that the election victory of Hamas should be no surprise. He said Hamas ran a well-organized campaign and had predicted months ago that they were aiming for between 70 and 80 seats in the 135-seat legislature. The idea that this is the end of the political process is nonsense, since under Israeli Prime Minister Ariel Sharon there was no political process. Furthermore, the idea that Fatah did not use violence and only Hamas did, is also nonsense. He said Hamas has a national agenda and they will organize to achieve it.

The source pointed to an article in the January issue of Prospect magazine by Alastair Crooke, the former MI-6 agent with many years of experience with the Palestinians. He was also a member of Sen. George Mitchell's fact-finding mission on the causes for the second intifada.

Although that article was written prior to the elections, he pointed out that a Hamas win would in fact represent a victory of not only Hamas but the militant wing and younger generation of Fatah, led by imprisoned leader Marwan Barghouti. Hamas has a great deal of respect for Barghouti, who is considered the "engineer" of the intifada, and was instrumental in organizing a ceasefire among all the militant groups. Crooke pointed out that this young Fatah faction exerted its power last year during the Fatah primaries. He said that this alarmed the old guard, who tried to suspend the elections. There will most likely be cooperation between this younger Fatah leadership and Hamas.

Crooke wrote the following on what Hamas could be expected to do once in power: "Hamas will aim to rally as many of the factions as possible to agree on Palestinian national objectives. They will lay out the means to achieve those objectives and designate a popular leadership able to bring them about." Hamas will most likely call for a ceasefire "to be agreed and reciprocated by Israel, that would last a full generation and that, unlike past truces, would deal with all the outstanding issues that might be resolved in a long-term period of calm." Hamas would call for a withdrawal to the 1967 lines, and a Palestinian state with Jerusalem as its capital. Hamas would not disarm at the outset of the process, but there could be demilitarization in step with political progress, as seen in Northern Ireland.

He concluded that a new, invigorated Palestinian leadership "may yet offer an unexpected window for political agreement between Israelis and Palestinians." It might be difficult for Israel, he said, "but offers the best chance for an enduring settlement."

Cheney Peddles 'New Baghdad Pact' Scam in Cairo, Riyadh

A well-placed Arab source provided EIR with a report on U.S. Vice President Dick Cheney's recent trip to Egypt and Saudi Arabia. The source reported that Cheney peddled the idea that, in the aftermath of the overthrow of Saddam Hussein, a new regional security architecture was needed, modelled on the old Baghdad Pact. This time, Cheney lied, the key would be a military alliance among Israel, Egypt, and Saudi Arabia, to provide regional security against radical Islamic terrorism. Cheney reportedly spelled out a six-month timetable for "resolving" the Iran nuclear crisis, involving a stretched-out sequence of IAEA and UN Security Council actions; he reportedly pressed Saudi Arabia to commit to increased oil output, and demanded Egypt expand its refinery capability—as a means of averting an "oil shock" in the event the U.S. had to launch a military action against Iran's nuclear weapons program.

Briefed on this report, U.S. statesman Lyndon LaRouche commented that what Cheney was peddling in Cairo and Riyadh was a "suckers tale," and that Cheney and his Synarchist backers are actually operating on a much shorter time frame, to blow up the entire region, as part of their end-game drive to destroy the nation-state system altogether and create a Synarchist world dictatorship under war and depression conditions.

Iran Plans To Establish Oil Market

Iran decided in its Third Development Plan (2000-2005) to set up an oil and associated derivatives market, and to invoice energy contracts in euros instead of dollars. The plan, according to its project head, Mohammad Javad Assemimpour, will try to make Iran the center of oil deals in the region. The IOB should be operational sometime this year.

Although, for security reasons, it is not expected that many will relocate to Iran, over time, the IOB could become competitive with the International Petroleum Exchange and the NYMEX, which both deal in dollars.

The IOB could thus establish a new euro-denominated crude oil market, thus making it possible for some GCC (Gulf Cooperation Council) countries to sell oil for euros. Eurozone countries make up one-third of Iran's imports. U.S. energy-related companies would not be able to take part in the bourse, due to the U.S. trade embargo on Iran (which was just extended).

Audit Finds More Fraud and Waste in Iraq Contracting

The latest audit report from the Special Inspector General for Iraq Reconstruction is the latest in a series of such reports documenting the poor management of Iraqi oil funds, control of which the U.S. took in May of 2003. In the new report, released Jan. 23, Inspector General Stuart W. Bowen, Jr. reports that deficiencies in contract management by the now-defunct Coalition Provisional Authority's South-Central Iraq region did not effectively manage 907 contracts and 1,212 micro-purchase contracts (worth $5,000 or less) worth a total of $88.1 million, between October of 2003 and June of 2004. In most cases, lack of documentation meant that the money disbursed for contracts could not be accounted for. There were cases in which contracts were split into smaller pieces in order to avoid reporting requirements, and cases in which contractors were paid up-front at the time the contract was signed but no follow up was ever done to determine if the contractor actually had done what it was paid to do.

One of these cases involved the replacement of four elevators in the hospital in Al Hillah. The contractor's failure to do the work properly resulted in the failure of one of the elevators, killing three people. "During this audit, we found indications of potential fraud," which instances are now under investigation, Bowen stated.

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