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An October Surprise?

NEWS ARTICLE from The Plain Dealer, 7-11-02, By HANS GREIMEL, The Associated Press

``World stock markets reel after record one-day tumble on Wall Street

TOKYO -- World stock markets wilted Thursday after a plunge on Wall Street shook confidence in the U.S. economy's ability to drive global growth ...

"If the United States starts to crumble, it could unravel what we're starting to see here in terms of recovery," warned Ryo Hino, an analyst at JP Morgan in Tokyo ...

On Wednesday, [7-10-01] jittery investors drove the Dow down more than 280 points to close at 8,813.50. It was the first finish below 9,000 since October, [2001] and also the biggest one-day point loss in nearly 10 months.

Meanwhile, the Nasdaq and Standard & Poor's 500 indexes hit new five-year lows. The S&P sank 3.4 percent to 920.47, while the Nasdaq fell 2.5 percent to 1,346.01.

"The sell-off last night smelled of fear, a `get-me-out-at-any-price' kind of trading session," said Tom Hougaard, a trader at the London firm City Index.

The fear spread to Asia at the opening bell, where markets typically follow Wall Street's lead. Hong Kong's Hang Seng index plunged 1.75 percent, or 188.81 points, to 10,598.73. And Seoul's Korea Composite Stock Price Index, or Kospi, finished the day down 3.75 percent at 764.88.

"Everybody is trying to dump shares. Nobody has any interest in buying," said Francis Lun, general manager of Fulbright Securities in Hong Kong. "There is also pessimism over the U.S. economy and its economic recovery."

U.S. stocks tumbled Wednesday after Bank of America downgraded blue-chip bellwethers Ford and General Motors to "market perform" from "buy." The decision left many investors feeling that there are few, if any, safe havens in the market.

The bad news came on top of a wave of accounting scandals at firms like telecom giant WorldCom and energy trading house Enron ...''

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NEWS ARTICLE from The New York Times, 7-11-02, By JEFF GERTH and RICHARD W. STEVENSON

``Bush Calls for End to Loans of a Type He Once Received

WASHINGTON -- President Bush received two low-interest loans to buy stock from an oil company where he served as a board member in the late 1980's. He then benefited from the company's relaxation of the terms of one loan in 1989 as he was engaged in the most important business deal of his career.

On Tuesday, Mr. Bush called for a halt to those types of insider transactions, challenging corporate directors to "put an end to all company loans to corporate officers."

The loans from Harken Energy allowed Mr. Bush to acquire 105,000 shares in the company -- 80,000 in late 1986 and 25,000 in 1988 -- through a stock option program that was available to top corporate officials. Harken did not require repayment of the principal for eight years and charged 5 percent annual interest. The prime rate in December 1986, when Mr. Bush received the initial loan, was 7.5 percent ...

To finance the stock purchase in 1986, Mr. Bush originally had to assume personal liability for repayment. He pledged as collateral not only the 80,000 shares he got through the options program but also other Harken shares [212,000 shares] he had gotten for selling his struggling energy company to Harken earlier that year.

In 1989, Harken relaxed the terms of the 1986 loan to remove any "personal liability to yourself," the company's lawyer wrote to Mr. Bush on Oct. 5 of that year. The change had the effect of freeing Mr. Bush's original 212,000-share block of Harken stock, which he sold the next year.

That sale, in June 1990, brought him $848,000, which he used to pay off a $500,000 loan he had taken out to help him buy into the Texas Rangers baseball team, a deal that helped secure his own personal fortune and propel him into Texas politics ...

The June 1990 Harken stock sale led to an investigation by the Securities and Exchange Commission -- during his father's administration ...

The S.E.C. took no action against Mr. Bush ...

[TIMELINE from The Center for Public Integritya

``1986

George W. Bush and partners sell their failing Spectrum 7 Energy Corp. to Harken Energy Corp ...

1990

... On June 22, Bush sells his Harken stock at $4 a share, for a total of $848,560. He uses most of the proceeds to pay off a loan he had taken out the previous year to buy a partnership interest in the Texas Rangers for $600,000.

On Aug. 22, Harken files a second quarter report disclosing for the first time that it is hemorrhaging. Total losses for that quarter are $23.2 million. Stock plunges to $2.37 a share.

That fall [1990] the Securities and Exchange Commission discovers that Harken had effectively concealed earlier losses in its 1989 annual report, before Bush sold his stock ...

1998

Bush's trust ... sells his $600,000 stake in the Texas Rangers for about $16 million'']

One issue that has come up again is why Mr. Bush was tardy in filing one of the S.E.C. forms disclosing his 1990 stock sale. The White House has said that it was Harken's responsibility to file the form. At a news conference on Monday [7-8-02], President Bush said, "I still haven't figured it out completely," after saying years ago that the S.E.C. had lost the form.

According to company documents, however, Harken's lawyers sent Mr. Bush two memos in the months before the 1990 stock sale setting out in detail new procedures for filing paperwork with the S.E.C. But one of the two required forms regarding Mr. Bush's sale of the 212,000 shares reached the S.E.C. 34 weeks late, and while Mr. Bush had signed it, he left the date blank ...

Mr. Bush's involvement in Harken traces back to 1986, when it acquired an oil company he controlled, Spectrum 7 Energy ...

Soon after, Mr. Bush was given a chance to participate in a stock option program that the company's filings describe as being available to its "executive officers," even though Mr. Bush was technically a director and consultant rather than a member of management.

Mr. Bush, like some of the other Harken executives who received shares at the time, chose to pay for them through a promissory note.

According to a letter on April 27, 1987, from Harken's general counsel to Mr. Bush, the note was collateralized by the 80,000 shares he was buying plus the "shares due to you from Harken's acquisition of Spectrum 7 Energy Corporation. [212,000 shares]"

But two years later, the arrangement was changed. No longer was Mr. Bush personally liable for repaying the loan. The only shares he had to pledge as collateral were the 80,000 the loan was allowing him to buy ...''

NEWS ARTICLE from The Plain Dealer, 7-12-02, By PETE YOST, The Associated Press

``Who bought Bush's stock in problem-plagued oil company and why? ...

WASHINGTON -- It is a stock market whodunit that has withstood a decade of scrutiny. Who bought George W. Bush's problem-plagued oil company stock just before its value dropped?

The 1990 transaction involving shares of Harken Energy Corp. allowed the future president to pay off a bank loan for his now-famous stake in the Texas Rangers baseball team. The identity of the buyer of the stock has escaped public disclosure.

Federal regulators who examined the deal as a possible insider trade never asked. President Bush says he doesn't know and the White House declines to ask the broker who handled the transaction. Reporters have fared no better in getting to the bottom of the mystery.

Was Bush's sale of Harken stock another instance of a helping hand from family friends? ...

In the 1990 stock sale, Bush collected $848,560 when he sold 212,140 shares he had gotten in the merger of his struggling oil company with Harken in 1986.

By the time of the sale, Harken's finances also were in the red. Daily trading activity in the stock was as little as 1,300 shares on the New York Stock Exchange. If Bush had tried to sell such a large amount of Harken stock into the open market, it undoubtedly would have driven the price far below the $4 a share he was paid.

Bush's oil industry career is a history of being bailed out of money-losing ventures. Among the businessmen who came to his rescue before Harken were Cincinnati businessmen Mercer Reynolds III and William O. DeWitt. They eventually invested in the Rangers with Bush, raised more than $3 million for his presidential campaign and served as co-chairmen of Bush's inaugural committee. Reynolds is now U.S. ambassador to Switzerland and Liechtenstein.

Bush's sale on June 22, 1990, was handled by California stock broker Ralph D. Smith ...

The 1990 sale triggered an insider trading probe of Bush because he was eight months late in disclosing it to the Securities and Exchange Commission ...

SEC investigators interviewed Smith in the probe, but, according to Smith, they never asked the broker who bought Bush's stock.

Over the past two years, news organizations have tried to persuade Smith to ask the buyer to waive the cloak of confidentiality that surrounds the transaction, but the retired broker has declined ...

While Smith declines to name the purchaser, his difficult-to-read handwritten notes turned over to the SEC in the insider trading probe of Bush supply a clue.

The notes for June 9 appear to state that "Geo Bush will sell 212,010 shares in about 2 weeks." The June 22 entry on the day of the sale appears to state, "s/212,140 at 4 to Lee for Bush." ...''

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NEWS ARTICLE from The New York Times, 7-11-02, By ALISON MITCHELL

``Assailing Corporate Scandals, McCain Offers Tough Proposals

WASHINGTON -- With a biting indictment of "morally challenged executives," Senator John McCain put himself at the leading edge of the drive against corporate wrongdoing today, laying out proposals for broad new regulation of business that go far beyond those of President Bush and leading Democrats ...

Mr. McCain condemned "crony capitalism," and he also excoriated American companies for moving their addresses to offshore tax havens like Bermuda:

"Although American tax policy encouraged them to do so, corporations that move their legal headquarters offshore to avoid taxes give the appearance of ingratitude to the country whose sons and daughters are risking their lives today to defend them."

One of Mr. McCain's proposals, to require companies to treat executive stock options as an expense on their income statements, was debated in the Senate today, but it is not expected to be approved ...''

NEWS ARTICLE from The New York Times, 7-11-02, By GRETCHEN MORGENSON

``Bush Failed to Stress Need to Rein In Stock Options

George W. Bush wants to run corporate criminals out of town on a rail. But he is not trying to confiscate perhaps their most powerful weapon.

In his 27-minute speech on corporate responsibility, Mr. Bush spent less than 30 seconds tackling the issue that many believe is central: the issuance of huge amounts of stock options to top executives. Until this problem is addressed, true change will be slow to come to boardrooms.

Enron, Global Crossing, WorldCom. These corporate collapses have a common thread. By misrepresenting the financial position of their companies, executives at all these companies watched their stock prices soar and became richer in the process. After the misrepresentations were disclosed, shareholders and employees were left with little or nothing.

Stock options are crucial to both the misrepresentation and the enrichment that have caused a crisis of confidence in business and financial markets. Options are doled out as free money to executives and are the force behind the increasingly lucrative compensation packages at American companies ...

Because of the way options are treated in financial statements, they help executives "shade the truth," to use the president's words, by overstating a company's earnings and generating significant cash flow that has nothing to do with day-to-day operations. They also help companies bolster earnings by reducing and even eliminating taxes owed to the federal government. Since executive pay is often linked to a company's earnings, the overstatements that stock options produce can mean fatter paychecks for management ...

The numbers at some companies are enormous. According to Bear, Stearns, option costs at Microsoft came in at $3.3 billion last year [2001], almost a third of the company's reported net income ...

As options have become more popular, their salutary effect on company earnings has done so as well. Bernstein estimates that if the nation's 500 largest companies had deducted the cost of options from their revenues, their annual profit growth from 1995 to 2000 would have been 6 percent instead of the 9 percent reported.

Not surprising, WorldCom was a big user of stock options, and its financial results looked much better because of them. Adam Quinton, a telecommunications stock analyst at Merrill Lynch, said that of the large companies in the sector, WorldCom's earnings were most greatly enhanced by its option grants last year. Had the company accounted for its options as an employee cost, its earnings would have been 57.4 percent lower...

When employees exercise options, the tax they owe on the transaction becomes a deduction for the company issuing the shares. As a result, companies that are heavy users of options, including Microsoft, Cisco Systems and Dell Computer, have erased much if not all of what they owed to the federal government in taxes in recent years. At Enron, for example, deductions for stock options helped eliminate more than $625 million in taxes that the company owed to the government from 1996 to 2000.

Companies reap another benefit when their employees exercise options. An employee pays the company to buy the shares outright. That generates excess cash flow, which only attentive investors will see has nothing to do with day-to-day operations. At WorldCom, for example, half the company's free cash flow in 1999, $886 million, came from workers exercising options [and then being able to sell the stock at high prices before the public is aware of the disastrous financial conditions] ...''

FEATURE ARTICLE from The Washington Post, 4-9-02, By Warren Buffett, Page A19

[The writer is chief executive officer of Berkshire Hathaway Inc., a diversified holding company, and a director of the The Washington Post Co., which has an investment in Berkshire Hathaway.]

``Stock Options and Common Sense

... Companies could then, as now, compensate employees in any manner they wished. They could use cash, cars, trips to Hawaii or options as rewards -- whatever they felt would be most effective in motivating employees.

But those other forms of compensation had to be recorded as an expense, whereas options -- which were, and still are, awarded in wildly disproportionate amounts to the top dogs -- simply weren't counted ...

Furthermore, there is a hidden, but very real, cash cost to a company when it issues options. If my company, Berkshire, were to give me a 10-year option on 1,000 shares of A stock at today's market price, it would be compensating me with an asset that has a cash value of at least $20 million -- an amount the company could receive today if it sold a similar option in the marketplace.

Giving an employee something that alternatively could be sold for hard cash has the same consequences for a company as giving him cash. Incidentally, the day an employee receives an option, he can engage in various market maneuvers that will deliver him immediate cash, even if the market price of his company's stock is below the option's exercise price ...

A number of senators, led by Carl Levin and John McCain, are now revisiting the subject of properly accounting for options. They believe that American businesses, large or small, can stand honest reporting, and that after Enron-Andersen, no less will do ...

1) If options aren't a form of compensation, what are they?

2) If compensation isn't an expense, what is it?

3) AND IF EXPENSES SHOULDN'T GO INTO THE CALCULATION OF EARNINGS, WHERE IN THE WORLD SHOULD THEY GO?''

FEATURE ARTICLE from The Motley Fool, 3-20-02, By Whitney Tilson

``The Stock Option Travesty

... what's the problem? My issues fall into three areas: dilution, bogus accounting, and perverse incentives.

Dilution is such a critical issue, yet few investors seem to pay much attention to it. By owning a share of stock, you have an ownership stake in a company. The intrinsic value of that share is a function of only two things: the intrinsic value of the business and how many shares are outstanding. If the share count is rising, then the shares you own are losing value, all other things being equal.

Imagine for a moment that you own 100 shares of a business with 1,000 shares outstanding -- in other words, you are a 10% owner and are therefore entitled to 10% of any profit distributions, 10% of the proceeds if the business is sold, etc. Now, let's assume that management initiates a generous (to them) stock option program that increases the share count by 4% annually.

In about 18 years, the share count will double to 2,000 and your stake in the business will have been cut in half. Even if the value of the business doubles over this period, you've done nothing but tread water. Management, of course, has done fabulously: While getting paid salaries and likely bonuses every year along the way, they now also own 50% of the company due to the options they've received ...

Accounting for stock options is completely insane. Despite the fact that they are obviously a form of compensation and obviously have a cost to shareholders, stock options do not have to be expensed according to generally accepted accounting principles (GAAP) ...

The impact of stock options does, however, appear elsewhere in companies' financial statements, generally in three areas:

1) A rising share count, which leads to the dilution noted above.

2) When employees exercise their options, they must pay the company the strike price in order to receive shares. This cash intake generally appears on the cash flow statement in the section "Cash Flows from Financing Activities," ...

3) Companies also receive a tax break when employees exercise options. Let's say an option has a strike price of $10 and the stock price is at $30. For every option exercised, as noted above, the company collects $10 from the employee -- but it also gets to deduct the $20 profit earned by the employee as a compensation expense, just as if it had paid the employee a $20 cash bonus.

Fair enough, since this is clearly a form of compensation, but then why shouldn't this expense appear on the income statement, just like a cash bonus?! The tax savings for some companies are truly amazing: ... last fiscal year ... for Microsoft, it was $3.1 billion ... As a taxpayer, do you smell a rat? ...

Given this ludicrous accounting, I wonder why companies don't issue far more options. For example, why should options only be used as a form of compensation? Why not pay other expenses like rent and advertising with stock options? It sounds silly, but theoretically a company could pay nearly all of its expenses with stock options and then report amazing (read: artificial) results ...

The bottom line is simple: Managements in many cases are making enormous fortunes from stock options at the expense of shareholders, yet there is little protest because the absurd accounting obfuscates their true cost ...''

Guest columnist Whitney Tilson is Managing Partner of Tilson Capital Partners, LLC, a New York City-based money management firm.

NEWS ARTICLE from The New York Times, 7-16-02, By DAVID E. SANGER and RICHARD A. OPPEL Jr.

``Senate Unanimously Passes Corporate Reform Measure

WASHINGTON -- The Senate ... unanimously passed a broad overhaul of corporate fraud, securities and accounting laws to curb the abuses that have rocked Wall Street ...

The bill ... would create a new regulatory board with investigative and enforcement powers to oversee the accounting industry, limit the amount of consulting work auditors can perform and prohibit Wall Street investment firms from punishing honest research analysts whose reports anger clients of the firm.

But it was far from clear tonight what form a final bill might take by the time it emerges from a conference committee where House and Senate versions of the legislation must be reconciled ...

Senator Trent Lott of Mississippi, the Republican leader, suggested that Republicans might seek to scale back the long jail sentences included in the Senate version for corporate officers who mislead investors. He said it was important to review the legislation, which he voted for, to see "if we've gone too far."

Republicans said they might also seek to modify the powers of the federal board to oversee the work of the accounting industry. That new panel is a main element of the "Sarbanes bill" ..., named for Senator Paul S. Sarbanes, the Maryland Democrat who has long championed these measures ...

The timing of final Congressional action on the corporate reform measure was unclear, although the President urged action before the summer recess.

"There's a lot of worry that the White House and others will try to string this out and water it down," Senator Jon S. Corzine, the New Jersey Democrat and a former top official of Goldman, Sachs, said today ...

While Coca-Cola announced on Sunday [7-14-02] that it would begin to include stock options on its expense reports, most other companies, especially in high technology, oppose that requirement. They lobbied heavily, and today the Senate blocked an amendment offered by Senator Carl Levin, the Michigan Democrat, calling on the Financial Accounting Standards Board to review the issue within a year ...

"The use of a technical blocking tactic to prevent a vote on my stock option amendment leaves one of the most important post- Enron reforms unaddressed," Mr. Levin said. "Huge amounts of stock options, which benefited mainly top executives, helped fuel Enron-type accounting deceptions."

Tom Daschle of South Dakota, the Senate majority leader, said, however, that he planned to bring up the Levin amendment soon ...

Now, the legislation will be sent to conference committee, where House and Senate lawmakers will work out the differences in the Sarbanes bill and a measure by Representative Michael G. Oxley, an Ohio Republican, that passed in April.

Some fundamental differences remain in the two approaches. Mr. Bush and House Republicans, for example, want the proposed new regulatory board to have less investigative and enforcement powers ...

Many Republicans also say that the Senate bill goes too far in requiring accountants to give up much of the consulting work for the same companies they also serve as auditors. This provision, although less sweeping than an outright ban, was inserted by Senator Sarbanes and his allies to make sure that auditors do not relax their scrutiny to please a company that pays them a lot of money for nonaudit services, exactly what many senators suspect happened with Arthur Andersen and Enron ...

A Democratic aide said, however, that drafts of the legislation indicated that Republicans planned to take out two crucial parts of the Senate proposal: provisions giving new protections to corporate whistle-blowers, and a requirement to retain important audit documents for five years. As expected, House Republicans also plan to delete Senate language that would lengthen the time plaintiffs' lawyers and defrauded investors have to file securities-fraud lawsuits against corporations ...

There was no talk today of Congressional excess as lawmakers competed to show that they are in the lead in cracking down on corporate abuse. But inside the administration, concern about that movement continues. Vice President Dick Cheney, the former chief executive of Halliburton, has been the most outspoken in expressing those concerns ...''

NEWS ARTICLE from The New York Times, 7-30-02, By Reuters

``WASHINGTON -- Hoping to restore investor confidence after a wave of boardroom scandals, President Bush vowed ``hard time'' instead of ``easy money'' for corporate crooks on Tuesday [7-30-02] as he signed a law that quadruples penalties for accounting fraud.

But just hours after the signing ceremony, lawmakers and congressional aides warned that Bush may already be trying to roll back provisions that protect whistle-blowers who come forward with allegations of fraud. ``This is disturbing,'' said Sen. Charles Grassley, an Iowa Republican.

The new law, largely written by Maryland Democratic Sen. Paul Sarbanes ... was far tougher than measures proposed by Bush, who has been questioned about his own stock sales and a low-interest loan he accepted while he was an outside director at Harken Energy Corp more than a decade ago ...

The law ... includes provisions protecting employees of publicly traded companies when they take ``lawful acts'' to assist federal regulators, law enforcement agencies, as well as ``any member of Congress or any committee of Congress.''

But in a statement issued late on Tuesday, Bush said these protections would apply to whistle-blowers who provide information to congressional committees conducting investigations -- and not necessarily individual lawmakers.

Key lawmakers said this interpretation could amount to a rollback of what Congress intended to protect whistle-blowers from retaliation. ``I would hope the administration is not beginning to water down the law within hours of the president's signing it,'' said Senate Judiciary Committee Chairman Patrick Leahy, a Vermont Democrat ...

With questions lingering over Bush's stock sales and loans while at Harken, and the SEC investigating accounting practices at the Halliburton oil-services firm during Vice President Dick Cheney's tenure as chief executive, Bush is in an awkward position in convincing voters he is serious about cracking down on abuses by big business ...''

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NEWS ARTICLE from The New York Times, 7-10-02, By THE ASSOCIATED PRESS

``Suit Claims Fraud by Cheney, Oil Co.

DALLAS -- A watchdog group sued Vice President Dick Cheney and Halliburton Co. on Wednesday, alleging fraudulent accounting practices at the oil services company he ran for five years.

The lawsuit filed by Judicial Watch accuses Halliburton of overstating revenues by $445 million from 1999 through the end of 2001. Cheney was chairman and chief executive of the company from 1995 to 2000.

``Halliburton overstated profits that many American citizens relied upon. That's fraudulent security practices and it resulted in those Americans suffering huge losses,'' said Larry Klayman, chairman and general counsel of Judicial Watch, a nonpartisan group based in Washington.

The lawsuit was announced in Miami and filed in federal court in Dallas ...

The company was informed May 28 [2002] that the SEC was looking into Halliburton's accounting methods for reporting cost overruns on construction jobs.

The SEC has not filed any charges against Halliburton.

Judicial Watch alleges that accounting practices the company adopted in 1998 resulted in overvaluation of Halliburton's stock, deceiving investors ...

The suit names Cheney, Halliburton, and accounting firm Andersen Worldwide and Arthur Andersen LLP ...''

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NEWS ARTICLE from The Morning Journal, 7-15-02

``Government the worst of all

WASHINGTON (AP) -- Lost in all the outrage over the corporate accounting scandals is one fact politicians do not like to acknowledge: The auditing problems at American companies cannot rival the bookkeeping shambles of the world's largest enterprise -- the U.S. government.

Exaggerated earnings, disguised liabilities, off-budget shenanigans -- they are all there in the government's ledgers on a scale even the biggest companies could not dream of matching.

WorldCom Inc. executives brought America's second largest long distance phone company to the brink of bankruptcy after using improper accounting to pad earnings by $3.8 billion.

Last year, when Congress was faced with a similar need to bolster the bottom line, lawmakers simply voted to shift the date by which corporations had to make a quarterly tax payment. The result: $33 billion in revenue badly needed to cover the costs of President Bush's big tax cut ...

On Friday [7-12-02], Bush's Office of Management and Budget offered its own restatement of earnings and expenses. The federal deficit for the current budget year, which ends in September [2002], is now projected to be $165 billion, not the $106 billion deficit the administration projected in February [2002].

The White House also once again cut the projected surplus for the next decade, to $827 billion. That is a far cry from the $5 trillion surplus projection Bush made when he took office, before a recession, a war on terrorism and his $1.35 trillion 10-year tax cut saw $4 trillion of that amount evaporate ...''

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COLUMN from World Net Daily, 8-20-02, By David Hackworth

``Protect homebase first

Iraq is dead center in our commander in chief's cross hairs. While the trigger hasn't yet been squeezed, our forces are on the march, and soon a giant juggernaut will be cocked and locked. The Butcher of Baghdad will be hit everywhere but loose if the attack order comes down.

No question Saddam Hussein, with spies near every U.S. military base and at our overseas launching pads ... is watching the fist move into position ...

When Psycho Saddam's finally cornered, the bottom line being his bunker simply isn't deep enough to save his sorry butt from what we'll dump on him, he has to have figured out that he's got nothing to lose by taking as many of those he hates with him as possible.

His idea of a good time these days is probably putting loyal kamikazes in place to strike back at us big-time with Weapons of Mass Destruction (WMD) -- real nukes, chemical and biological weapons or dirty bombs.

The Israelis know exactly what to expect from Saddam. Not only do they have an anti-Scud missile-defense system up and running, they're making sure their citizens are protected from WMD: Each house-building has a sealed room to keep out the deadly bugs and fumes, and everyone has a gas mask.

All first-responders -- medical, police, firemen -- are being vaccinated against smallpox. Even anti-radiation pills might soon be distributed to the general population ...

Thanks to our own proper planning, our forces in the desert will also be protected ...

But are the average Joe and Jane and their kids in the USA similarly set for the bad stuff? Because if you ask savvy members of our security screen about Iraqi WMD, they'll tell you they're already here, that Saddam's agents have been sneaking them in for years. If we can't stop tons of cocaine and heroin, they say, how could we stop a few containers of WMD?

Unfortunately, the average American family is about as ready for Armageddon as the good people working in the World Trade Center were up for evacuating the Twin Towers on the morning of Sept. 11 ...

Regrettably, the history of our country tells us that we only get our act together after we're knocked down. But this time around, the white stars and crosses could stretch from New York City to Los Angeles and back.

Mr. Bush, don't squeeze the trigger until our citizens are as well-protected as the Israelis. Right now, Saddam's exit from the world scene simply isn't worth the tragic price our unprotected citizens might pay.''

COLUMN from World Net Daily, 9-17-02, By David Hackworth

``Oops, more unexpected casualties

Back in 1990, a few months before the bombs started dropping on Baghdad, an Army pal slipped me a Pentagon study based on World War II experiences estimating that U.S. forces would suffer 50,000 casualties during the projected six-month campaign. Gen. Norman Schwarzkopf's staff later predicted a still-staggering 20,000 dead or wounded.

Because Stormin' Norman's forces brilliantly zapped Saddam Hussein's mob in a record-breaking 100-hour ground war, actual U.S. casualties were a mere fraction of these two estimates -- 147 Killed In Action and 457 Wounded In Action. At least at first look.

But within weeks after our warriors took off their boots and hung up their rifles, dozens, then hundreds, of Gulf War vets became casualties. And as the years tick by, this figure has already grown to tens of thousands.

It wasn't bullets that took them down, but a casualty-producer the experts didn't count on called Gulf War Illness. So far, according to an April, 2002, Veterans Affairs report, an additional 7,758 Desert Storm vets have died, while 198,716 vets have filed claims for medical and compensation benefits. Of the claims filed, 156,031 have been granted as service-connected, with more vets being designated casualties as each day passes.

The 198,716 figure represents a staggering 28 percent of the vets -- 696,579 -- who fought in the Gulf War conflict! ...

After scores of studies costing more than $150 million, a definitive cause for Gulf War Illness has yet to be announced. Investigators and researchers have targeted a number of things, including: the unproven vaccines and drugs our troops were forced to take; the U.S. Depleted Uranium Munitions used against Iraqi armor that exposed our soldiers to radiation; pollution from the oil-well fires; local diseases; even the clouds that blew over our troops when captured Iraqi chemical-warfare weaponry was destroyed by Army engineers.

Gulf War vet Michael Woods, president of the National Gulf War Resource Center Inc., says VA Secretary Anthony Principi is hiding the truth by not releasing the up-to-date "death and disability" statistics on Gulf War veterans as required by law.

Woods tells me he's concerned the VA is stonewalling because the unreleased casualty statistics could undermine the case for war that is being made by President George W. Bush and the noisy platoon of war hawks -- who've never stood anywhere near a hot battlefield -- pressing for an Iraqi "regime change" from the safety of their Washington bunkers.

Woods' organization is also adamant that our forces get the right protection and detection gear and the right training before we march back into Iraq.

"President Bush shouldn't order our warriors into another Gulf fight until we know what happened 11 years ago," says Robert McMahon, president of Soldiers for the Truth. "The VA needs to tell the truth regarding the suffering of thousands of vets."

Before we commit to another Gulf War, our government must come clean on what happened to our Desert Storm heroes. Congress and our media must hound the president and the VA until they tell the nation what caused the enormous casualties in the first place, and what's been done to reduce the hazards facing our troops this time around.''

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