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NEWS ARTICLE from The Washington Post, 1-31-06, By Justin Blum, Washington Post Staff Writer

``Exxon Posts Record Profit

Exxon Mobil Corp. yesterday reported the highest profit in U.S. history: $10.71 billion for the fourth quarter of 2005 and $36.13 billion for the entire year ...

Exxon, of Irving, Tex., and other oil companies have benefited from unusually high market prices for crude oil, gasoline and natural gas -- the result of tight supplies and high demand. Hurricanes Katrina and Rita, which disrupted domestic production and refining last fall, contributed to those conditions and pushed prices higher. In recent weeks, oil markets have sent prices even higher because of concern about tension between Western countries and oil power Iran over its nuclear program.

At Exxon, the world's largest publicly traded oil company, profits rose despite a drop in production across 2005. For the year, combined oil and natural gas production was down 3.6 percent from 2004 ... The company is massive, operating in almost 200 countries and territories ...

Exxon's fourth-quarter profit rose 27 percent from the same period a year earlier; its annual profit climbed 43 percent from 2004. The company's 2005 revenue was $371 billion, higher than the gross domestic product of Belgium ...

The profit growth is in line with, if not exceeded by, earnings jumps at other major oil companies.

Last week, Chevron Corp. reported that its fourth-quarter profit was up 20 percent from the year before. Also last week, ConocoPhillips reported a 51 percent increase in fourth-quarter profit and Marathon Oil Corp. said that its fourth-quarter profit nearly tripled. Oil giants BP PLC and Royal Dutch Shell PLC have yet to report their profits ...

Oil companies are trying to downplay their profits. Exxon and the American Petroleum Institute, an industry trade group in Washington, ran newspaper ads yesterday saying oil companies' earnings per dollar of sales are below, or in line with, those of other industries ...

The bulk of Exxon's quarterly profit -- more than $7 billion -- came from production and the company's natural gas and power-marketing business.

Analysts said some new oil and natural gas projects in Russia, Nigeria and Qatar should help to boost the company's production. "I think you are going to get a period of positive movement here with the start of these new projects," said Jacques Rousseau, an analyst with Friedman, Billings Ramsey Group in Arlington ...''

Staff researcher Richard Drezen contributed to this report.

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FEATURE ARTICLE from The International Herald Tribune, 12-14-05, By John Gault

``Has Iraq helped America's energy security?

GENEVA -- Many in the Arab world and beyond believe the real purpose of the U.S.-led invasion of Iraq was to seize control of the country's oil.

The Bush administration, presumably to avoid confirming these beliefs, has not touted energy security as a central justification for the invasion, even as other pretexts - from weapons of mass destruction to the linkage between Saddam Hussein and the Sept. 11 attacks - have been discredited.

Nevertheless, oil has long hovered in the background. When the White House's economic adviser, Laurence Lindsey, said in September 2002 that the Iraq invasion could cost $100 billion to $200 billion (an estimate the White House quickly disavowed as too high), he indicated that one could expect an additional three to five million barrels a day of Iraqi oil production following the ouster of Saddam.

As it turns out, the Pentagon will have spent $281 billion on the war and occupation through fiscal year 2005, but Iraq's oil production today remains below the level sustained by Saddam even under international sanctions restricting oil industry investment.

The $281 billion figure, recently calculated by the Congressional Research Service, does not include all of the costs that would continue even if the war were to end now, such as benefits for veteran, such as

  • benefits for veterans,

  • contributions to Iraqi reconstruction and

  • interest on the national debt.

  • Nor does it include such economic costs as the impact of higher oil prices induced and sustained, at least in part, by the continuing turmoil in Iraq.

    Stephen Walt, the academic dean of Harvard's Kennedy School of Government, writes in the current issue of Foreign Policy that "Although our armed forces have fought with dedication and courage, this war will ultimately cost us more than $1 trillion, not to mention thousands of lives. And what will the United States have achieved?"

    Walt's figure, high as it may seem, is only in the middle of the range predicted by William Nordhaus, a Yale professor, before the war. In 2002, Nordhaus wrote that the invasion could cost between $99 billion and $1.9 trillion, depending upon how long the occupation lasted and the impact of the consequential oil price increase on the U.S. economy.

    If Walt's figure of $1 trillion is in the right ballpark, it is reasonable to ask whether this expensive investment will, in fact, improve U.S. energy security and, if so, whether the improvement is worth the cost.

    So far, the Iraqi invasion has contributed to the demise of the old U.S. energy security structure in the Middle East. This structure had two parts: friendship with traditional regimes ruling the oil-producing states, and willingness to use military might to protect their power and their oilfields. In return, the United States received assurances of ample oil supplies at moderate prices.

    The Iraq intervention forever changed this equation. It revealed that even a U.S. military occupation could not protect oil installations from sabotage. It revealed that America, tied down in Afghanistan and Iraq, might not be able to come to the rescue of another regit America, tied down in Afghanistan and Iraq, might not be able to come to the rescue of another regime at the same time.

    It revealed that the Bush administration would promote "democratization" in the Middle East at the expense of authoritarian regimes. And it continues to augment anti-American feelings in the region, putting governments friendly to America in an awkward position.

    Even an increase in Iraq's oil production capacity has not been achieved. Nordhaus, in his optimistic case, anticipated that Iraqi production would rise to three to four million barrels a day within two years after an invasion. Iraqi experts, soon after the invasion, spoke of capacity rising to six million barrels a day by 2010 given sufficient investment.

    In fact, Iraq's oil output today is well below two million barrels a day and is declining. Major oil companies wait in the wings pending the emergence of a stable government and an improvement in physical security.

    So the $1 trillion investment has hardly paid off in terms of U.S. energy security. If Arab public opinion is correct and the purpose of the invasion was really to seize control of oil, the goal is at best receding ...''

    John Gault is an independent energy economist based in Geneva.

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    GUEST EDITORIAL from The Washington Post, 2-18-04, By Michael Doran

    [Americans have been drawn into somebody else's civil war]

    ``Palestine, Iraq, and American Strategy

    Last week U.S. authorities in Iraq revealed the contents of a memo purportedly written by Abu Musab Zarqawi, an al Qaeda operative. This remarkable document calls for sparking a sectarian war in Iraq to wake sleepy Sunni Muslims to the threat of destruction and death at the hands of Shiites. The letter, even if it is a forgery, faithfully expresses al Qaeda's attitude toward sectarianism, and it should help convince Americans of how deep the Sunni-Shiite conflict is in the Persian Gulf.

    Many Sunnis, especially religious extremists, hate Shiites more than they hate Israel. Al Qaeda's basic credo puts the matter bluntly: "We believe that the Shiites are ... the most evil creatures under the heavens."

    Sectarian tension is woven into day-to-day life in a number of Gulf societies. It's a well-known fact that in Saddam Hussein's Iraq, the Shiites, though a numerical majority, were second-class citizens. But few Americans know that a similar imbalance exists in Bahrain, where the Sunni-dominated state rules a society that is 75 percent Shiite.

    Next door in Saudi Arabia, the Shiites make up a much smaller percentage of the total population (10 to 15 percent), but they are concentrated in the oil-rich Eastern Province. This sectarian geography has prompted at least one prominent Saudi cleric to call for the "ethnic cleansing" of the Shiites.

    Optimists in Washington have argued that the establishment of representative government in Iraq will have a kind of democratic domino effect. Zarqawi's war plan, however, forces us to recognize another possibility: a successful U.S. policy could also lead to sectarian conflict.

    Democracy in Baghdad would spell Shiite domination over the Iraqi system. This prospect is a bitter one for some Sunnis in surrounding countries, and al Qaeda is working to exploit the resentment. We can already read the writing on the wall in Saudi Arabia, which must be considered -- after Iraq itself -- as al Qaeda's primary target.

    When it comes to Shiites and their aspirations, the radicals of al Qaeda and the Saudi religious establishment have identical views: Shiites are the intimate enemy. They dwell among the Sunnis and outwardly make a show of friendship and brotherhood. Inwardly, they will stop at nothing to destroy their sectarian rivals.

    The current international crisis, many Saudis believe, is providing the Shiites with an opportunity to do just that. Even before Hussein's regime fell, the story of Ibn Alqami was circulating in Saudi religious circles. A Shiite minister to the last Abbasid caliph, Alqami betrayed his ruler by conspiring with Hulagu, the Mongol leader who in 1258 sacked Baghdad and destroyed the Abbasid Empire, the flower of Islamic civilization.

    Over the past year, Sunni religious conservatives have habitually referred to George Bush as Hulagu II. The moment that U.S.-led forces turned their guns toward Iraq, Sunnis began to ask in reference to the Iraqi Shiites, "Will the grandchildren of Ibn Alqami follow in their grandfather's footsteps?" When the Iraqi Shiites erupted in joy at the fall of Hussein's regime, their Sunni detractors lamented that once again Baghdad was toppled from within.

    The Shiites of Saudi Arabia are also viewed as exploiting the crisis to extract concessions from embattled Sunnis. Thus, three weeks after Hussein fell, they petitioned Crown Prince Abdullah for equal rights. (Saudi Shiites do not enjoy basic religious freedoms.)

    That the crown prince would even so much as read the petition aroused deep feelings of resentment among traditionalists. It fell to Safar Hawali, an influential cleric, to vent the feelings of indignation. In an indirect rebuke to the crown prince, Hawali wrote that God's law requires suppressing the Shiite heresy ..."

    So far, the crown prince has not bowed to Safar Hawali's demands. Abdullah continues to entertain the Shiite proposals within the framework of his "National Dialogue," a series of political discussions that may yet grow into a serious reform movement.

    Al Qaeda condemns the crown prince's project, precisely because it includes blasphemous groups such as the Shiites. For its part, the Saudi religious establishment refrains from directly criticizing either Abdullah or his National Dialogue. But it does not shrink from launching indirect attacks along the lines of Hawali's rebuke.

    For instance, in early January [2004], 156 clerics signed a petition decrying the editing of Saudi textbooks. The government has already deleted passages attesting to the eternal enmity of Christians and Jews toward Islam, and reformers are calling for even more changes to bring the country in harmony with the West.

    In language identical to al Qaeda denunciations of the National Dialogue, the petition depicts the proposals for a new curriculum as an anti-Islamic plot orchestrated by Crusaders, Jews and Shiites. A close reading of the petition reveals that it is not simply a protest against textbook changes but an oblique attack on the National Dialogue itself.

    Several weeks ago al Qaeda published an article that discussed the likelihood of a violent blow to the United States that would also destabilize Saudi Arabia. Zarqawi's sectarian bloodbath is undoubtedly the kind of event that the author had in mind. A rise in Sunni-Shiite violence in Iraq would inevitably inflame passions in Saudi Arabia. The ensuing turmoil would create conditions that, at the very least, would promote the anti-reform agenda that al Qaeda shares with the Saudi religious establishment. It might even shake the regime itself ...''

    Michael Doran is an assistant professor in the Department of Near Eastern Studies at Princeton University and an adjunct senior fellow of the Council on Foreign Relations.



    The Washington Post, 11-17-05, By Robin Wright, Washington Post Staff Writer

    ``An Eye for Terror Sites

    NSC [National Security Council] Puts Scholar in Charge of Middle East

    Michael S. Doran may have been destined to work for a Republican administration. During the 1972 presidential campaign, his father ran him around Carmel, Ind., to rip down posters of Democratic candidate George McGovern. His father was a Republican precinct committeeman. That was fun for a 10-year-old," Doran recalled recently.

    But Doran ended up at the National Security Council staff in charge of the Middle East because of his unusual specialty: He is a 21st century scholar -- an aficionado of Muslim extremist Web sites.

    At Princeton, Doran was on the Web as early as 5 a.m. to track the latest commentaries, manifestoes or fatwas from militant groups. His work soon put him on the map.

    After the September 11, 2001, attacks by al Qaeda, Doran wrote a defining piece in Foreign Affairs magazine -- "Somebody Else's Civil War" -- that Middle East experts still cite.

    Osama Bin Laden had "no intention of defeating America," Doran wrote. "War with the United States was not a goal in and of itself but rather an instrument designed to help his brand of extremist Islam survive and flourish among the believers."

    Al Qaeda wanted Washington to dispatch U.S. troops to the Islamic world, so Muslims would turn on governments allied with the United States -- and provoke their collapse, Doran explained. "Americans, in short, have been drawn into somebody else's civil war." ...''


    BLOG by TigerHawk, 3-31-05,

    TigerHawk (tig*er*hawk): n. 1. The title of this blog, and the nom de plume of its founding blogger ...

    ``Al Qaeda's grand strategy, Reported by TigerHawk, 3/31/2005

    Monday evening [3-28-05], I attended a public lecture on al Qaeda's grand strategy by Michael Doran, Asst. Professor of Near Eastern Studies at Princeton.

    Professor Doran was rather famously passed over for tenure [at Princeton] last spring, quite possibly because he does not hold to the prevailing academic dogma about the Iraq war and American policy in the Middle East ...

    In any case, the popular interest in Doran's lecture was such that it overflowed Bowl 16 in the lower level of Woody-Woo, so it moved to the auditorium upstairs. There still weren't enough seats. I got one, though, and typed up seven pages of notes during the 90 minutes that Professor Doran spoke and took questions. The following is a summary of the lecture, essentially a cleaned-up version of my notes with some of my own commentary woven in.

    Doran began with the advertised question: "Can an organization that does not have a well-developed command and control network -- such as al Qaeda -- have a grand strategy?"

    Al Qaeda is a loose-knit organization that ties together a lot of different radical Islamic groups from other parts of the globe -- essentially a lot of little local affiliates tied together by a common world view. It is unlikely that from his cave in Afghanistan Osama bin Laden is capable of planning all of the moves in this war with the United States.

    It is, nevertheless, possible to say that al Qaeda has a grand strategy, even if it is not driven from bin Laden's cave. This is because the ideology of radical Islam incorporates a grand strategy. This radical ideology sets long-term political goals, and it marries means to ends.

    How does radical Islam develop and communicate its strategy, and how does it execute?

    Through the web. There are thousands of pages of al Qaeda material available on the web. Doran has been reading this material and trying to absorb the view of the world that it reflects.

    It is becoming clear that the militants who developed and shape the direction of this ideology do have a grand strategy, and that they have spent a lot of time thinking very deeply about their situation. For example, they assumed from the beginning that their organization would be very fragmented.

    Al Qaeda's thinkers have reinterpreted Islam all the way back to the time of the Crusades (or even the time of the Prophet). They argue, for example, that Muslim victories in the Crusades were not attributable to Saladin, but to small bands of Muslim insurgents that laid the foundation for Saladin's victories.

    Their argument is that, in effect, al Qaeda-like organizations were at the source of Muslim triumphs a thousand years ago. These victories did not derive from the state, but from little bands of determined men. This reinterpretation of history shapes how they think about the war al Qaeda fights today.

    Just as they are writing about Muslim victories a thousand years ago, Al Qaeda's intellectuals consider themselves in the middle of a very long term struggle. Al Qaeda is saying: "We are not revolutionaries. It is the next generation, or the generation after, that is going to carry out revolution in the Middle East."

    It is therefore not quite right to say that al Qaeda is itself going to overthrow these regimes. Al Qaeda's ambition is 'to lay the groundwork for Saladin,' and 'shift the balance of power between radical Islam and the states in the Middle East.' As most of TigerHawk's readers know, "al Qaeda" means "the base" or "the foundation" in Arabic.

    Al Qaeda is saying, in general, that we're living through a transitional period in history. It began with the fall of the Soviet Union. During the Cold War, there were two poles, both idolatrous, both anti-Islamic. Together with their puppets in the region, these two powers could control the public space in the region.

    But the fall of the Soviet Union, the globalization of the economy and other changes are having the effect of "opening up public spaces that are not controlled by the 'puppet' states."

    American military and economic power and the local states, which al Qaeda looks at as 'one continuous complex,' are not sufficient to control everything everywhere. The goal of al Qaeda, therefore, is to force the contraction of that American/'puppet state' power. This contraction will open up spaces for radical Islam to grow in power unmolested.

    Indeed, there are today towns (Doran names a number) in the Middle East where radical Islam is effectively in control. Towns in Jordan, the south of Saudi Arabia, and even Fallujah before the battle in November [2004], remain effectively under radical control because the puppet states and the Americans cannot project power everywhere.

    How do we know this?

    Doran pointed to a web site (missed the URL) that contains a vast amount of Islamist writing (in Arabic). "This is al Qaeda's library." Vast material about historical Islamist uprisings, and how they have failed. "They are picking over 50 years of failed radicalism and drawing conclusions about how to succeed in the next generation."

    According to Doran, these were main points of transition over the past 50 years:

    In the 1930s and 1940s the Muslim Brotherhood arose in Egypt. The big problem, as they understood it, was that Egyptian society had been cut loose from its Islamic moorings. Their na´ve view was to put jihad at the center of Muslim life and drive the British out. They thought that once the British were gone society would naturally revert to Islam.

    They were wrong. Why? According to al Qaeda, the villain was Gamel Abdel-Nasser, the secular Arab nationalist who dominated Egypt during the first half of the Cold War. "In the eyes of the jihadis, Nasser is the devil of all devils. He was a popular, nationalist leader who enjoyed legitimacy at home," and he "continued the process of westernization that began under the colonialists."

    The Egyptian Islamist, Sayed Qutb, founder of the Muslim Brotherhood, began to think about this problem -- how is it that Egypt is ruled by an Egyptian, yet Islam has not returned?

    Qutb developed a set of doctrines that called for carrying out revolution at home, first. "Only by controlling the state and all of its power can (we) put true Islam back to the center of social and political life."

    Qutb's Muslim Brotherhood inspired similar organizations in other countries, and they all failed. Eventually, their leaders "landed in Afghanistan," the last country that would accomodate them. They began to reflect upon and write about their failure. A new synthesis emerged, and they were influenced by a couple of new influences.

    The first was a radical preacher (I missed the name) who reinterpreted the tradition of jihad in Muslim history. He argued, essentially, that the Prophet put together a solid "base" (there's that word again) because he participated in jihad.

    The other big influence was Wahabbism, the very strict Islamic tradition that emerged from Saudi Arabia and is promoted by the House of Saud. "The Wahabbis spend a lot of time defining who is and who is not a believer. They start dividing up the bad guys into all sorts of different kinds of bad guys. Some bad guys are a lot worse than others.

    So while these descendants of the Muslim Brotherhood were sitting there in Afghanistan they drew several big conclusions:

    First, the 'puppet states' were (and are) a lot stronger than they had originally supposed, and the jihadis were and are a lot weaker than they had realized. In addition, the jihadis have a tendency toward fragmentation, which tendency is exacerbated by the state which strives to foster that fragmentation.

    The first conclusion of the Afghanistan years was that the jihadis could not overthrow the state and usher in Islamist rule by themselves. This realization represented an intellectual departure from the Qutbian argument.

    Second, they recognized that public opinion matters. With the right public face, the radicals believed that they could divide the "bad guys."

    In order to recruit more followers, they decided that they have to be very clear about their goals, very transparent. The rank and file cannot be confused if it is to be harnessed toward the strategic objective ...

    Even though al Qaeda is, by our lights, very extreme, they caution themselves against extremism. For example, even if the Saudi state is illegitimate, al Qaeda draws all kinds of philosophical and moral distinctions designed to divide their enemies. This derives from both Islamic law, which they debate constantly, and their concern for public opinion.

    Al Qaeda will say, "We have the right to put a bullet in the head of the Crown Prince of Saudi Arabia, but it is not wise to do it." Al Qaeda chooses targets that will enjoy a wider legitimacy for violence -- such as Westerners living in isolated compounds -- but the propaganda that they put out is directed at the Saudi leadership.

    Doran cited as a small example the killing of Theo Van Gogh, which we now know was the work of jihadis. The letter fixed by a knife to Van Gogh's chest was directed at Muslim apostates, even though the victim of the violence was a Westerner.

    There have been very few attempts on the lives of Saudi princes, even though al Qaeda screams about it all the time. This is not because the thousands of Saudi princes are so well protected, but because al Qaeda is worried how the public will perceive killing the royal family.

    This ability to calculate their violence and calibrate it to their audience makes them much more sophisticated than previous generations of extremists.

    So where does the war stand now, according to al Qaeda?

    A leading al Qaeda operative has written a book, the title of which translates loosely to 'The Management of Chaos.' According to al Qaeda, the current stage of revolution is the stage of 'vexation and exhaustion' of the enemy. They have a notion of how to do this to the Americans and to their 'puppets'.

    You vex and exhaust the Americans, according to al Qaeda, by making them spend a lot of money. The United States is a materialist society, and if forced to spend too much money it will 'cut and run.'

    The means to this end is to force the Americans to spread themselves thinly. Al Qaeda wants to strike everywhere, not just spectacular high value attacks. This will cause the Americans to defend a lot of places at high cost.

    In addition, al Qaeda wants to force Americans to carry the war into the heartland of the Middle East. There are two reasons why al Qaeda sought an American invasion in the Middle East:

    First, it will be very costly for the United States and will therefore drain our treasury.

    Second, bringing the war to the heartland will have a polarizing effect within Muslim society. Doran believes that they borrowed this 'polarization' idea from Palestinian organizations of the 60s and 70s. Americans striking back 'without precision' will polarize Muslim society ...

    It is not necessary, according to al Qaeda, that they get the great masses on their side. The goal is to win over 'an important segment of the youth.' Their propaganda is directed to young men. One of their propagandists says that "if we can win over only 5% of one billion Muslims, we will have an unbeatable army."

    Al Qaeda also aims to "vex and exhaust" the local rulers. They start with the assumption that the social stratum in most of these countries is extremely thin. The number of well-trained troops in these countries who will remain loyal to the regime is small. The goal of the violence is to spread these loyal, competent troops thinly.

    Again, al Qaeda hopes therefore to strike dispersed soft targets with sufficient economic or political significance that they must be defended by the few competent soldiers loyal to the regime.

    They have targeted the foreign compounds in Saudi Arabia, for example. Once you have done this, then 'space opens up in society where the jihadis can dominate.' The leadership in the country has to start making distinctions in their society about places that are and are not worth guarding. There are then, by the decision of the regime, places where the radicals can operate unmolested.

    You can see this kind of thing very clearly in Iraq. Al Qaeda wants to open up spaces where it can operate with greater impunity. It had that in Sunni-dominated regions for a while, although that may be changing. Doran did not say why it may be changing, but his other work suggests that it is because of the success of the elections and improved counterinsurgency [an 'Iraqui' army which is really a bunch of Shiite death squads quite willing to sell out to the Iranians is an 'improved counterinsurgency'?].

    So al Qaeda claims it represents all of Islam, the true Islam, but "if you actually look at what they are doing on the ground, they play to the interests and perceptions of different groups.

    In Saudi Arabia, they play to southern discontents. Saudi Arabia has a "southern problem." Al Qaeda has been playing to southern disaffection. The southerners have an accent, they are calls '0-7s,' which refers to the area code. The traditional routes for advancement in this region are the clergy or the security services. Clerics and guns. "Al Qaeda has opened up a third option, which is clerics with guns."

    "Like all good politicians, they manage to speak to the resentments of particular constituencies while purporting to speak for all Muslims. This is what makes them so dangerous."

    Doran warns that we will need more than democracy to win this fight:

    "American ideology is not bad, but democracy alone is not going to solve their problems. It is not at all obvious that the people of southern Saudi Arabia, for example, are going to be better off in a free and open Saudi Arabia. This gives al Qaeda an opportunity to appeal to southern resentments, while it attacks democracy as idolatry.

    If Doran is right about al Qaeda's strategy, 'then a lot of the stuff being said in the media and universities is wrong.' Michael Scheuer is wrong.

    Al Qaeda is carrying out a struggle for a new order in the region. It is about relations between Muslims first and foremost, and concern about the United States is secondary. Even the greatest possible public diplomacy will not necessarily carry the day, according to Doran ...

    Questions from the audience:

  • Why has there been no attack on U.S. soil since September 11?

    [Quoting from above: "You vex and exhaust the Americans, according to al Qaeda, by making them spend a lot of money. The United States is a materialist society, and if forced to spend too much money it will 'cut and run.'

    The means to this end is to force the Americans to spread themselves thinly. Al Qaeda wants to strike everywhere, not just spectacular high value attacks. This will cause the Americans to defend a lot of places at high cost."]

  • What's the real difference between a guy like Zarqawi and a death cult?

    "I don't think he's indiscriminately killing. They are targeting people fairly carefully. They are attacking recruitment centers for the police, economic installations, election workers, anything that will legitimate the new order. It is designed to weaken the state.

    One of the differences between Iraq and Saudi Arabia is that al Qaeda is much more willing to kill Sunni Muslims in Iraq. This is why they don't attack the oil installations in Saudi Arabia." Doran's theory is that the combination of Zarqawi and Saddam's henchmen has led to a more indiscriminate slaughter in Iraq.

  • How is this going to play out in Egypt, where the Muslim Brotherhood is advocating democracy?

    "There is a difference between the Muslim Brotherhood and the radicals. It is kind of the tap root of these organizations, but it is not itself radical. Al Qaeda hates the Brotherhood, because it operates within a nationalist framework, which al Qaeda is very much against."

  • Is Iran the ideal state organization?

    "The Iranians are Shiites, and al Qaeda hates the Shiites. Over the long term, Iranians are very threatening to al Qaeda. Politics make strange bedfellows, so they may make alliances of convenience over the short term ..."

  • Is the ultimate goal of the radicals transforming society, or taking power?

    "Ultimately, it is taking power. But they are very calculating."

  • Are those goals limited to the Middle East?


  • What about the al Qaeda strategy explains the Madrid bombings?

    "That is a good example of al Qaeda thinking strategically. The Spaniards were the weak link in the coalition, and al Qaeda thought if they could drive Spain out they would drive a wedge between the U.S. and Europe." ...

  • What advice does Doran have to a U.S. policy maker that has to balance the interests of democratic civil society with the risk that some of these organizations are fronts for radicals?

    "I've been surprised how little work has been done on clerical politics in Saudi Arabia. We need to have a much more textured understanding of the domestic map of politics in these countries."

  • Can changes in American policy influence this situation?

    "I fight against the argument that solving the Arab-Isreali problem will make all of this go away. However, I am more confident than a lot of people about Iraq because of this Sunni-Shiite division ... [except that the Iranian army may become the occupying power]"

  • Has there been a change in American attitudes toward the House of Saud?

    "Everything has changed, and nothing has changed. The relationship will always been defined by shared strategic interests. The importance of the region for the global economy is such that we will still care very much about Saudi Arabia's policies ..."

  • Is Osama bin Laden any longer a central figure? Is his capture or non-capture a sideshow?

    "I don't know. I don't think he is insignificant. I think he has a pretty direct connection to the radicals in Saudi Arabia. His relationship with al Zarqawi in Iraq is more tenuous. In one sense he is irrelevant. There is an ideology out there that has a sense of its own. It tells everybody what to do."

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    Jones Beene ( to Vortex ( on 1-30-06:

    [Limitations on liability and national-security protections from investigation]

    ``Another missive from Harry Tuttle, who is hiding out in some South American country:

    "The Lone Gunmen" is/was the name of a TV pilot episode, conceived and shot in 2000 and aired six months before the tragic events of Sept. 11, 2001 which involved the hijacking of a commercial airliner with the intent of crashing it into the World Trade Center. You can order the DVD online. Here is more detail:

    Although the episode was centered on hi-tech instead of suicide, the eerie coincidence sent shockwaves through cast and producers -- mostly of "X-files extraction." so nobody accused them of being the terrorists link to the weak underbelly of American complacency.

    "I'll never forget that," says the producer "That was such a disturbing thing. It was very upsetting. As I say in the DVD, you write something like that, and you assume that if you can think of it, being a Hollywood writer, then somebody in the government has thought about it already" ... or had they?

    Speaking of 9/11 coincidence - in this case, a 30 year-old one: there is one Timothy McNiven. Tim is a 30-year U.S. Defense Department operative, who says he is still under contract with the government. Why he hasn't been fired yet is anybody's guess. Maybe they can keep him from going on the full-time lecture circuit this way.

    He has been openly preaching to anyone who will listen that his military unit in 1976 devised a mock terrorist attack of the Twin Towers almost exactly like what occurred on 9/11.

    He claims his unit created the "perfect terrorist plan" for the times using commercial airliners as weapons and the then 3 year old Twin Towers as their target. It was the most expensive building ever built.

    They even suggested that the terrorist villains would use boxcutters.

    The study, commissioned to C-Battery 2/81st Field Artillery, U.S. Army, stationed in Strassburg, Germany in 1976, specifically devised the scenario of the Twin Towers being leveled by Middle Eastern terrorists. This was a CIA project with congressional approval, according to McNiven ...

    Speaking of the Mayberry Machiavellians, here is a Trifecta that you probably don't know about: A single company provided top level security at the World Trade Center, Washington D.C.'s Dulles International Airport, and to both United Airlines and American Airlines between 1995 and 2001.

    Hmm... and this private company whose records are not open to full public disclosure, was backed by another private Kuwaiti-American investment firm, and with hidden records three layers deep in the Mid-East, but a clever investigative journalist has learned the name of the main kingpin for its US activities, including all of this (so-called) security. More like insecurity if you are related to any of the victims.

    Marvin P. Bush, younger brother of President George W. Bush, was director and principal US liaison in the company for seven years from 1993 to 2000, when most of the work on the big projects was done. But none of the White House responses to 9/11 have publicly disclosed the company's part in providing security to any of the named facilities. Marvin wisely got out of the arrangement a few months before 9/11. Probably just a lucky coincidence for him.

    Public records indicate that the firm, formerly named Securacom, had Bush on its board of directors but that is all they are required to divulge. The firm, which is now named Stratesec, Inc., is located in Sterling, Va., a D.C. suburb, and emphasizes federal clients. Marvin Bush is no longer on the board and refuses to be interviewed.

    The American Stock Exchange delisted Stratesec's stock in October 2002. Believe it or not, this foreign financed security firm, Securacom, also had a exclusive contract to provide security at the top secret Los Alamos National Laboratories -- one might opine that this lab is a bit notorious for its numerous security breaches, but who woulda guessed a foreign-backed security firm could have gotten that contract?

    According to its present CEO, Barry McDaniel, the company had an ongoing contract to handle security at the World Trade Center "up to the day the buildings fell down." Yet instead of being investigated, the company and companies involved with it have benefited from legislation pushed by the White House and rubber-stamped by Congress. Stratesec, its backer KuwAm, and their corporate officers stand to benefit from limitations on liability and national-security protections from investigation provided in bills since 9/11.

    Signed, Harry Tuttle, Ductwork engineer and aspiring investigative journalist.''

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    NEWS ARTICLE from the Associated Press, 1-30-06, By YAHYA BARZANJI, Associated Press Writer

    ``First Bird Flu Death Confirmed in Iraq

    RANIYA, Iraq - Battered by rampant violence and political instability, a new threat in Iraq was confirmed Monday, the first case of the deadly bird flu virus in the Middle East.

    A 15-year-old Kurdish girl who died this month had the deadly H5N1 strain, Iraq and U.N. health officials said. The discovery prompted a large-scale slaughter of domestic birds in the northern area where the teen died as the World Health Organization formed an emergency team to try to contain the disease's spread.

    "We regretfully announce that the first case of bird flu has appeared in Iraq," Iraqi Health Minister Abdel Mutalib Mohammed told reporters.

    World Health Organization officials confirmed the finding, though it was not immediately clear how the girl, Shangen Abdul Qader, who died Jan. 17 in the northern Kurdish town of Raniya, contracted the disease.

    The prospect of a bird flu outbreak in Iraq is alarming because the country is gripped by armed insurgency and lacks the resources of other governments in the region. Government institutions, however, are most effective in the Kurdish-run area where the girl lived. Health teams cordoned off areas in and around Raniya on Monday and began Iraq's first bird slaughter.

    Policeman Khalil Khudur said he led a team that killed 3,000 birds, mainly chickens and ducks, in Sarkathan, a village of about 600 homes four miles north of Raniya. Villagers and cars were also sprayed with chemicals to kill any trace of the disease.

    But there were fears they might be too late. Health officials are investigating the death of the girl's uncle, Hamasour Mustapha, 50, on Friday after showing symptoms similar to bird flu. At least two other people have been admitted to a hospital in Sulaimaniyah, 160 miles northeast of Baghdad, with similar symptoms. Another 30 samples from northern Iraq are also being tested for bird flu.

    WHO is readying an emergency team to carry out epidemiological tests and examine Iraqis exhibiting bird flu-like symptoms, spokesman Dick Thompson said ...

    Abdul Qader and her uncle lived in the same house in Raniya, about 60 miles south of the Turkish border and 15 miles west of Iran. Health officials do not yet know how the girl contracted the virus, but just north of Raniya is a reservoir used as a stopover by migratory birds from Turkey, where at least 21 cases of H5N1 have been recorded ...

    The risk of the virus spreading may not increase unless there are big clusters of cases in Turkey or other countries, indicating that the strain has become more virulent, said Angus Nicoll, of the European Center for Disease Control and Prevention. "Clusters (are) what we are looking for, and we haven't seen that in Turkey," Nicoll said.

    Experts fear the virus could mutate into a form spread easily among humans, triggering a pandemic capable of killing millions. So far, most human cases have been traced to contact with birds. A total of 85 people had died of the disease worldwide before the Iraq case was reported, according to WHO figures.

    "It is always worrying to have a new case in a new country because it raises concerns among the public," Thompson said. "But we have to understand that so far this is just one case."

    The girl's mother rejected the bird flu findings, but acknowledged that a number of her chickens had mysteriously died before her daughter's death. "My daughter did not die from bird flu," Fatima Abdullah, 50, told The Associated Press. "She did not like chickens nor had anything to do with them. She did not take care of these birds."

    Turkish authorities said Monday the H5N1 virus in birds had been detected in 31 of Turkey's 81 provinces. Close to 1.6 million fowl had been culled so far.

    Health experts said controlling such an outbreak and undertaking a mass bird cull in Iraq would be difficult due the country's more limited veterinary and monitoring infrastructure. "If an outbreak of avian influenza were to be proven, there would be a lot of support needed," said Maria Zampaglione, spokeswoman at the Paris-based World Organization for Animal Health.

    Kurdistan Health Ministry official Najimuldin Hassan said thousands of domesticated birds are expected to be killed, but authorities did not know how to kill migratory birds nor were equipped to do so. Khudur, the policeman conducting the cull in Sarkathan, complained that his team was also not properly equipped to safely conduct the slaughter. "We lack plastic boots, masks and gloves. If we tear the gloves on our hands, there are none to replace them," he said.

    A top U.N. official pinpointed the issue, and its financial implications on cash-strapped Iraqi villagers and farmers, as the gravest one facing authorities. "The problem comes down to funding more than anything else," Rod Kennard, who manages the U.N. Food and Agriculture Organization's assistance program for Iraq, said from neighboring Jordan. "If they have enough money in order to pay people off so that people will not be reluctant to cull their birds, it's less of an issue." ...''

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    COLUMN from The Plain Dealer, 12-20-04, By Edwin Black

    [Majority Shiite rule may detour toward Iranian-style theocracy]

    ``Minority Sunnis and majority Shias have massacred and oppressed each other in Iraq since the 7th century, and sometimes did the same for the country's Armenians, Assyrians, Chaldeans, Jews, Kurds and other minorities. In the last half of the 20th century, the upper hand was seized by Sunni Baathist strongmen, Saddam Hussein being the latest.

    The concept of one-man one-vote, in which the results will virtually parallel the religious groups, automatically guarantees that the Shiite majority will once again control the nation, settling old scores and disenfranchising everyone else, and laying the groundwork for another civil war.

    More than that, free elections - anathema in most of the Middle East - are viewed by the joint domestic and pan-Arab insurgency as just another device of foreign occupation. [A 'democrcy' is a government willing to sign oil contracts with US companies.] ...

    The assumption or seizure of central authority in Iraq has never constituted a true representative government accepted by the warring tribal factions. In consequence, even if the election takes place, even if the Shiites deliver a statistical majority for the turnout, the forces of Sunni and insurgent rejection will demonize them as illegitimate, thus further plunging the populace into violence ...

    Adding a volatile additional dimension is the distinct possibility that majority Shiite rule will not propel the nation toward Western-style democracy, but detour toward Iranian-style theocracy ...

    The people of Iraq have never wanted Western-style pluralistic democracy or elections. The idea has always been imposed from abroad. They know their history. In 1920, the nations of the Middle East were created where no nations had previously existed by Western oil imperialism and the League of Nations; this was done solely to validate under international law the post-World War I oil joint monopolies that France and England had created.

    Pro-western monarchs and other rulers were installed to sign on the dotted line, legitimizing the contracts. At the same time, the Western capitals spurned the Arab national movement. When the Arabs hear the very term "democracy," they hear a codeword for "we want a stable environment for oil." ...''

    Black is the author most recently of "Banking on Baghdad, Inside Iraq's 7,000-Year History of War, Profit, and Conflict."

    [``... C. S. Gulbenkian, the legendary Mr. Five Percent, through intrigue and high-drama created the Red Line Agreement monopoly, dividing Iraq's fabulous oil wealth between British, American, and French cartels. The Hashemites, from Sharif Hussein and King Faisal to his brutally-murdered progeny, fought alongside Lawrence of Arabia to achieve independence in Syria, but were given Iraq instead ...

    The Mufti of Jerusalem, in his war against Zionism, using Iraq's oil and strategic location as bait, sealed an alliance with Hitler during World War II and lead a pro-Reich coup in Baghdad met by a British invasion to oust it. The post-World War II Ba'ath predecessors of Saddam Hussein ravaged Iraq's minorities and paved the way for the recently-deposed tyrant ...'']


    Banking on Baghdad , 12-2-04, By Guerrilla News Network (GNN)

    ``Mess-o-potamia in a nutshell: The GNN interview with author Edwin Black ...

    Black is best known for his inflammatory book `IBM and the Holocaust', in which he documents how the IBM provided highly specialized machines that enabled the Nazis to carry out genocide (GNN collaborated with Black for a NewsVideo of the same name).

    The documentation in Banking on Baghdad is equally as exhaustive. He uncovers for the first time a secret 1928 agreement in which western powers and their oil conglomerate proxies carved up most of the Middle East for their own use, with little or no thought for the people whose oil lay under their land ...

  • GNN: You challenge a lot of the conventional thinking about Iraq, including the notion that Iraq was the 'Cradle of Civilization.'

    Black: Iraq is not the Cradle of Civilization. In point of fact, Jericho had a thriving civilization some 9,000 to 11,000 years ago. There was a civilized and spiritual community in the south of France painting animals on the cave walls 15,000 to 30,000 years ago, paintings that still captivate us millennia later. Some 60,000 years ago, we see civilized family and tribal relationships in among Southern African cave dwellers.

    What made Iraq or ancient Mesopotamia the 'Cradle of Civilization' was a comment by a British imperialist, Sir Henry Rawlinson, on April 8, 1867, during a discussion at the Royal Geographical Society in London. He was speaking about how much of a prize Mesopotamia would be. Mesopotamia, that V-shaped region between the Tigris and Euphrates rivers, has been sought after by numerous imperial powers.

    Looking back, Mesopotamia developed many ancient codes, such as the so-called Code of Hammarubi. Many people refer to this as the first code of justice. But it was really a code for commerce: how much are you compensated when your slave loses a tooth, how much would you have pay the boatman to take you across the river, what is a fair price to store grain. So these commercial values became social and justice values, hence the thought that this was the mergence of civilization.

    Because the land attained a level of commercial activity previously unknown, Mesopotamia became regarded as the 'Cradle of Civilization,' but it should really be known as the 'Cradle of Commerce.'

  • GNN: There was a time under the Ottoman Empire in which Mesopotamia became a sort of imperial backwater until the advent of the age of oil.

    Black: Yes. There were only two attractions for the western world in this region: geography and geology. During the Ottoman regime, it was a midpoint between India and Europe, so Britain exercised a sphere of influence over Basra and the entire Gulf. The Ottoman's in far-off Istanbul found the three provinces of Mesopotamia -- mostly Kurdish Mosul, mostly Sunni Arab Baghdad and mostly Shiite Arab Basra -- to be ungovernable, lawless and unprofitable. Hence, these provinces were only nominally under Turkish rule.

    Remember, Mesopotamia was not always an Arab or Islamic land. There were hundreds of thousands of Jews in that land going back 2600 years, a thousand years before the Arabs or Islam came to the country. There were Assyrians, Armenians, Chaldeans, Yazidis. But as a result of the Islamic Conquest in the 7th century AD, the majority was subsumed by a new people and a new dominant religion.

    Moving forward, after commercial petroleum was discovered in Titusville Pennsylvania in 1859, oil became the most important commodity in the world. Here was have the second attraction?and it was a fatal attraction.

  • GNN: One the most memorable parts of your book is all the creative ways you describe how people in this region found to massacre each other.

    Black: They had centuries of genocide, between Sunni and Shi'a, Mongol and Arabs, against Assyrians, Armenians. I have not found a generation going back 7,000 years that was not visited by extraordinary violence and vengeance. There has never been a destructive event so severe to convince people to stop victimizing their neighbors. The people of Iraq are experts at victimizing their perceived victimizers. We haven't learned that yet.

    Perhaps our biggest single mistake has been our attempt to remake that land in our image. These people do not want democracy. They are an intolerant people that oppresses half their community, women ... I assure you, when the people of this region hear the word 'democracy' they hear a code word for 'you people want to take our oil.'

  • GNN: What was the Red Line agreement?

    Black: The Red Line Agreement was the secret agreement between the U.S France and England to divide up Mideast oil. Because western oil companies had invented these countries, they weren't even able to name the map marks, and so they simply a red line around a map of the larger Middle East, saying everything within this line shall be under our control. It became the biggest monopoly of all time. That map appears for first time in my book on the inside front cover.

    Now to specifics. The Red Line Agreement was in truth the dissection and ingestion of the Turkish Petroleum Company, which was seized from German interests and surrogates. The four companies that took over were the Anglo Persian Oil Company, now known as British Petroleum; British Shell, that is an anglicized and London-controllable Royal Dutch Shell; French CFP, which is now Total; and the U.S. designated an regulated cartel, the Near-East Development Corporation which was owned by Standard Oil and several other American companies ...

  • GNN: It's amazing that people don't know this history. They can still buy the WMD [Weapons of Mass Destruction] claims or that we're there to liberate the Iraqi people.

    Black: ... For 90 years, we've been using our best corporate surrogates, our best diplomats and best armies to retain our access to the oil. In 1917, the American Petroleum Institute told the Wilson administration that we have only forty more years of oil in the States and that we'd need to go to Iraq. In 1918, when the British seized the first two thirds of Iraq, the British General stood at the gates of Baghdad and said, 'Our army has come not as conquerors but as liberators.' We haven't even changed the vocabulary ...''

    Top -- Home

    POST from SecurityFocus, 7-12-06, Posted by: Robert Lemos

    ``Systems attacked at State Department

    Online attackers allegedly breached computer systems at the U.S. Department of State and worldwide offices in June [2006], installing remote access software, stealing passwords and targeting information on China and North Korea, according to an article by the Associated Press.

    A State Department spokesperson acknowledged to the Associated Press that the attacks had happened but maintained that no sensitive information had been compromised.

    The attacks should not come as a surprise to U.S. officials or the security community. Online attackers, which some security experts believe to be state sponsored, have targeted stealthy, low-volume attacks at specific individuals inside government agencies and corporations.

    In May, security experts discovered that attackers were using a zero-day exploit for a flaw in Microsoft Word to compromise targeted systems. The attacks have apparently originated in China or used a Chinese server from which to attack.

    The State Department, which got an 'F' on its security posture under the Federal Information Security and Management Act (FISMA) for 2005, instructed many employees to change passwords, officials told the AP. The attacks, and the agency's response, severely limited network access at many office locations.''


    NEWS ARTICLE from The Plain Dealer, 7-10-06, by Foster Klug, Associated Press

    ``U.S. urges China to lean on North Korea

    WASHINGTON -- The United States on Sunday pushed China to apply more pressure on North Korea to end its missile tests and return to international nuclear disarmament talks ...

    The diplomatic goal is to compel North Korea to return to stalled six-nation talks aimed at ridding the reclusive communist-led nation of its nuclear weapons program, Burns said. The U.S. consistently has rejected formal direct talks with North Korea, preferring the six-party negotiations, deadlocked since November [2005] ...

    Getting support from China, North Korea's main ally and trading partner, is seen as crucial ...

    Meanwhile, India test-fired its longest-range nuclear-capable missile on Sunday for the first time, government officials said ...''


    POST feom, 6-20-06, Posted by Peter Herford

    ``Do you remember Hu Jintao's April 2006 visit to Washington, D.C?

    If you watched any of the news coverage on television you likely bring to mind the image of a Falun Gong protester and other odd faux pas. What received less attention were the circumstances surrounding the visit.

    The visit began weeks before the Chinese President and Party leader arrived. Chinese Vice Minister Wu Yi dropped in on the White House before the visit to be reassured that Washington supports the one-China policy of the mainland. Lest anyone have any illusions, "one-China policy" means that Taiwan is considered a province of the mainland; in no sense an independent entity of any kind.

    Why does every administration in recent memory dutifully reiterate this support? Given the fact that the United States is committed by treaty to defend Taiwan against attack, why would the defender agree with the notion that its client isn't even a state?

    We have a saying in journalism: Follow the money.

    In this case follow the U.S. trade deficit and the overall U.S. indebtedness ... US public debt increases at the rate of 1.74 billion dollars per day ...

    China and Japan together daily buy 40% of the U.S. debt in the form of United States Treasury Bonds ... Japan and China seem content to be primary lenders -- or looked at another way: Bankers -- to the United States. That was an important and little noted aspect of the Chinese President's visit to President Bush.

    President Bush's banker was paying a call.

    Those of you with debtor relationships with banks will understand that a visit from the banker is when you make nice. Therefore there was little surprise when Mr. Bush once again reiterated the US support for the "one China policy." The U.S. President generally has a slightly grim, or at best wan, look on his face when he makes these public statements. But when the banker to whom you owe a large percentage of your assets asks, you tend to comply.

    In addition, the aforementioned Vice Minister Wu Yi came to the U.S. with a delegation of 150 Chinese businessmen in the weeks before the Presidential visit for a shopping spree.

    The Chinese fanned out across the United States to large and medium-sized cities where they bought everything from heavy machinery to software to airplanes. Billions of dollars worth. Some of those deals had already been made and were months old. Others were in the works, and still others are yet to be completed. But the overall impression, carefully orchestrated, was to impress on the United States the buying nature of China; not just the sale of Chinese made goods in the U.S. There were about 20 cities on the Chinese tour.

    Imagine the headlines in each of those local papers, and the local news on TV and radio ... The Chinese delegation spent a few days in Seattle, (where the airplane was manufactured) and where China's newfound best friend Bill Gates makes his home ...

    The most important stories: Chinese airlines bought 42 Boeing aircraft worth about 5-billion dollars retail. (The Chinese got a big discount, and at least 20 of the airplanes had been ordered months before.) Once again the public impression was a huge order ...

    After visiting the Boeing plant and watching them make airplanes and speaking to production line workers, the Chinese President announced a deal with Microsoft which will expand the companies already sizeable research facility in China. Microsoft all but became the preferred software company of the Chinese government ...''


    ANALYSIS from Alarab Online, 6-28-06, By Ahmed Amr, Editor of

    ``Three long years into this war of choice, most Americans and Arabs are still trying to figure out why George Bush wasted so many chips playing Iraqi roulette.

    If the nasty Mess on Potamia wasn't about the phantom weapons of mass destruction, it certainly had nothing to do with spreading the blessings of democracy to the region ...

    The United States had fifteen long years to encourage the development of a model democracy in Kuwait - which remains a family ruled oil plantation with a rubber stamp parliament. Uncle Sam could have leaned on the Saudis to get with the program. So far, the custodians of the oil plantations in the kingdom of oil have managed to stage male only elections to contest half the seats in a few city councils.

    By now, it should be clear to one and all that war in Iraq has done nothing but create more willing and eager adversaries in the 'war on terror.' As a result of Bush's escapade, a nasty sectarian civil war has converted Baghdad into the most dangerous city on earth. There is no other place in the planet where fifty mutilated bodies are dumped in the municipal morgue on a regular daily basis.Every Iraqi is a potential victim in a chaotic landscape where a guy wearing a cop uniform by day moonlights as a member of a death squad by night.

    The occupation army led by American forces has abandoned its legal responsibility to ensure the safety of their colonial subjects and focused their effort on 'force protection.' These days, Washington is more concerned with conducting behind the scenes haggling with Tehran to come up with a face saving exit strategy. Most likely, Bush will try to work out a deal where he ends up ceding Iraq to theocrats beholden to the clerics in Iran in exchange for a pledge from Tehran to forget about joining the nuclear club ...

    Regardless of the very tangible and tragic outcomes of what has been called the greatest strategic debacle in American history, our media savants have yet to ponder the reasons why Bush went out of his way to sell the war to a gullible and vulnerable post-911 America ...

    One vital statistic - an American trade deficit that amounted to $804 billion in 2005. For every dollar of imports, America manages to export 53 cents worth of goods and services. In fact, contrary to popular belief, the United States is a trading wimp that has run up exponentially rising trade deficits for thirty consecutive years.

    Why are the folks in Washington constantly harping about the joys of the global economy when American producers have consistently demonstrated their inability to compete in world markets? The evidence of their lack of competitiveness is littered in thousands of communities from sea to shining sea which have been blighted by the loss of three million manufacturing jobs since Bush set foot in the White House.

    Every twenty four hours, Uncle Sam exports two billion dollars in newly minted currency to settle the daily trade deficit ... Each and every day of the week, the world delivers to our harbors cars, toys, consumer electronics, oil and a thousand other necessities to maintain 'our way of life.' In consideration, we give them paper money. And they still come back the next day and get another box of American currency backed by nothing more than - you guessed it - Arab oil.

    Take a moment here to digest the most brilliant imperial venture in human history - a feat that defies economic gravity. America has the sweetest deal with the kleptocratic custodians of the oil plantations in the Gulf. For their part, the House of Saud and the Kuwaitis have agreed to price their oil in dollars, to accept payment only in dollars and to 'recycle' a good portion of those "petro-dollars" into American capital markets - buying up corporate stocks and the bonds the United States government issues to finance the $400 billion annual budget deficit.

    In exchange, the American government provides protection to the ruling dynasties against all comers - domestic and foreign. Incidentally, one of the domestic threats against these police states is the very democracy that Bush has no intention of spreading.

    The nightmare scenario for the wizards in the State Department is the day common folks in Saudi Arabia and Kuwait get the right to hold their governors accountable for where the oil revenues go.

    The oil-for-dollars-and-only-dollars policy forces oil importers around the globe to hoard American dollars. China and Japan now have an estimated $1,700 billion ($1.7 trillion) in US dollar reserves. Given their trade history with the United States, they definitely are not holding on to these dollar reserves to buy American products ...

    Those dollars have intrinsic value because they are directly convertible into Arab oil. That's why they call them petro-dollars. Conveniently enough, the rise in oil prices has further increased demand for the dollar - at a time when the American trade deficit is going through the roof.

    The business of America used to be business. Now, the United States government has figured out a way to produce real tangible wealth out of paper and green ink ... America's biggest business is the US Mint. We have become a currency exporting economy - a new economic phenomenon that undermines every economic theory postulated since Adam Smith ...

    Now here's the bad news. The "Arab-oil-for-American-dollars" racket is no longer a cost free proposition. With the mounting tab in blood and treasure from Bush's dice game in Iraq, the more sober pencil pushers in the CIA and the State Department will soon realize that their currency exporting venture has gone from being a virtual El Dorado to a resource hogging sink hole.

    Make no mistake, when the politicians in Washington talk about our 'national interests' in the region - they are talking about maintaining our lucrative currency exporting franchise ...

    Perhaps what is more tragic is that the people in the Middle East have come to believe that this is about a western religious crusade instead of an exercise in imperial voodoo economics - aided and abetted by their dynastic rulers who are Machiavellian enough to pose as 'defenders of the faith.' ...

    Both Arabs and Americans need to clear their minds of this culture clash trash and start asking a few basic questions ... Why did the Saudis and Kuwaitis support the invasion of Iraq? ...

    What role does the trade deficit play in formulating American policy in the region? Why do other nations hold huge dollar reserves when they obviously have no intentions of buying American products?

    Where do the oil revenues go? [The biggest reason for switching to methanol or ethanol is that some of the dollars we spend for oil are coming back at us as bullets and bombs]

    What would be the economic consequences of the emergence of democratic governments in the region that refused to price their oil in dollars? ...''


    NEWS ARTICLE from Fast Company, Issue 106, June 2006, Page 80, By Robert Buderi

    ``The Talent Magnet

    Kai-Fu Lee, technologist and self-help guru, is a raging celebrity on Chinese university campuses. Now Google is paying him upward of $10 million to build its research lab in Beijing ...

    It was May 31, 2005; and Lee was still a vice president at Microsoft. Although he was working in Redmond then, few knew China better. Microsoft had hired him in 1998 to open its research lab in Beijing. The lab attracted top Chinese computer-science graduates, and it has since made its presence felt in just about every Microsoft business, contributing key algorithms for MSN's new search engine and developing ever more realistic graphics for Xbox games ...

    Microsoft's archrival, Google, was at that moment dangling a package worth at least $10 million to lure him away. Google wanted Lee to help it conquer the search market in China--a meager $278 million in 2005 but growing at a dizzying pace--where it currently trails homegrown Baidu.

    Even more important is the market for talent. In 2004, roughly 350,000 computer scientists, information technologists, and engineers graduated from Chinese institutions of higher education, compared to 140,000 in the United States, according to a study by the U.S. National Academies, the nation's top science advisory body ...

    To Microsoft's utter dismay, Lee would accept Google's offer. His new job, which comes with the title vice president for engineering and president of Google Greater China, is to create a talent magnet, building an R&D center that will tap into the nation's trajectory and mining the best and brightest from Chinese universities to feed Google's own growth. His story speaks volumes about the global race to apply talent to innovation--and what it will take to win ...

    In 1998, Lee was already a minor Silicon Valley legend when Microsoft came knocking, asking him to open a China research lab. Lee had three key goals in founding the Microsoft lab. One was obvious: to do great research that would feed new products. The second, which in 1998 put Microsoft far ahead of its competition, was to open a novel conduit for attracting the untapped talent in Chinese universities. The third and most ambitious was to help create the innovation infrastructure--starting with world-class education and training for students--that would enable China to become a more integral part of the modern world ...

    While some at Microsoft leaned toward building the new lab in business-savvy Shanghai, he chose Beijing, which was home to more top universities and closer to key government agencies. He and his colleagues then called on universities and government officials, entered into academic collaborations, and spoke to thousands of students about what was needed to succeed in the 21st century. The Microsoft lab became the top draw for Chinese computer-science graduates and built top programs in speech recognition, wireless, multimedia, graphics, and search.

    For his success, Lee was called back to Redmond and named vice president of Microsoft's natural interactive services division, charged with commercializing features like text-to-speech technologies. But last May, when he learned that Google planned to establish a China R&D lab, he emailed CEO Eric Schmidt, expressing interest in the job. The Google brass bit hard, offering Lee a $2.5 million signing bonus and another $1.5 million after one year, plus stock worth more than $5 million.

    Lee inked the deal last July [2005]. Microsoft quickly sued to enforce its noncompete clause, drawing headlines around the world. But the firms settled within a few months ...

    The R&D center, staffed by homegrown talent well-versed in local preferences, will create products initially for the Chinese market: Search and paid advertising for mobile phones are likely, as is Chinese speech recognition as a search interface.

    Eventually, though, Lee expects the lab to help change the flow of innovation worldwide. In areas such as mobile-phone usage, China is leading the world. "So we will build a product first in China and then understand the product and move it back to the United States or Europe when that market matures," he says ...

    That chance to make a global impact is another big drawing card for the Google center. Yang Liu, an early hire lured from Sybase's China operation, puts it this way: "A group of smart and great people could do something really great for the world."

    It's clear already that realizing such ambition will be more than a matter of nurturing top talent--and that meshing East with West won't be a pro forma exercise. Google, which recently launched, attracted the wrath of many in the United States by agreeing to the self-censorship dictated by Chinese laws, which includes blocking search results on sensitive topics such as "Tibetan independence."

    In February [2006], Lee was hounded on the subject when speaking at UC Berkeley and Stanford University. Lee declined to comment on the censorship issue ...

    Google is, of course, playing with a double-edged sword. The democratic urge it represents--its mission is "to organize the world's information and make it universally accessible and useful"--is fundamentally at odds with China's restrictive policies ...

    Robert Buderi is a writer in Cambridge, Massachusetts. His book with Gregory T. Huang, Guanxi: Microsoft, China, and Bill Gates's Plan to Win the Road Ahead (Simon & Schuster), was published in May [2006].''


    POST from Homeland Stupidity. 7-12-06, By Michael Hampton

    ``Chinese hackers hit State Department

    The U.S. State Department said Tuesday that hackers from China and other areas of Southeast Asia broke into the department's computer network in June and stole files, resulting in the department shutting off Internet connectivity for several days.

    U.S. officials familiar with the incident told the Associated Press that investigators believe the hackers compromised passwords, stole unclassified information and planted backdoors in systems to allow them to return easily ...

    The State Department shut down Internet access entirely for its Washington headquarters and several foreign offices ... State Department employees have been instructed to change their passwords.

    A National Security Agency program to protect sensitive and classified information on Defense Department and other government computers has been delayed until 2012 or later, according to defense officials, leaving the Pentagon open to more than 160,000 hacker attacks a year ...''


    NEWS ARTICLE from The Associated Press, 7-11-06

    ``WASHINGTON (AP) -- The State Department is recovering from large-scale computer break-ins worldwide over the past several weeks that appeared to target its headquarters and offices dealing with China and North Korea, The Associated Press has learned ...

    Tracing the origin of such break-ins is difficult. But employees told AP the hackers appeared to hit computers especially hard at headquarters and inside the Bureau of East Asian and Pacific Affairs, which coordinates diplomacy in countries including China, the Koreas and Japan.

    In the tense weeks preceding North Korea's missile tests, that bureau lost its Internet connectivity for several days. China's government was considered by experts a chief suspect in computer break-ins at the Defense Department and other U.S. agencies disclosed last summer [2005] ...

    The Pentagon warned earlier this year [2006] that China's army is emphasizing hacking as an offensive weapon. It cited Chinese military exercises in 2005 that included hacking "primarily in first strikes against enemy networks." ...''

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