Analysis: Oil, security for Iraq investors
Dubai, United Arab Emirates, Sept. 5, 2007 - Security in Iraq is a major holdup to investment there, sometimes second only to the lack of a law governing Iraq's vast oil and gas reserves. Various security plans, by Iraqi and U.S. forces, are intended to break the cycle of violence, but little of the ambitions for Iraq's future will take hold until its citizens face fewer day-to-day threats to their lives. Inter- and ... more

The Threats That Aren't: Michael Scheuer

Who Are The Fanatics?: Paul Craig Roberts

Drawing the Line: Nebojsa Malic

Thucydides vs. Victor Davis Hanson: John Taylor

Leaving Home...: Riverbend

Democrats Newly Willing to Compromise on Iraq

Bush Considers Standing by Iraq Strategy

US Report Says Iraq Interior Ministry 'Dysfunctional'

Pentagon Opposes Report Recommending Disbanding Iraqi Police

[i]Experts Doubt Drop in Violence in Iraq[/i]

Air Strike in Baghdad Kills 14 Sleeping Iraqis

Iraq Talks See GIs as Impediment to Peace

GIs Skeptical About Market That Generals Say Proves Surge Is Working

[i]Wednesday Attacks Kill 10 US Troops, 51 Iraqis; 65 Iraqis Wounded[/i]

Fred's In by John Gizzi Now that Fred Thompson is in the race he needs to score heavily in his first week.

NH Republican Debate Offers a Sneak Peek by Michelle OddisLast night in New Hampshire an actual debate took place for about 30 seconds, championing the 90 minutes of press conference rhetoric.

Democratic Primary Dates Battle May Boost Clintonby Robert Novak and Timothy P. CarneyThe decision by Clinton, Obama and Edwards to follow the Democratic National Committee mandate and skip disobedient states Michigan and Florida may be a huge windfall for Clinton.

Crushing on Fred Thompsonby Ericka AndersenFred Thompson broke the mold by announcing his presidential run on Jay Leno's The Tonight Show. Will he live up to the hype?

Chinese "Crackers" Attack Pentagonby Robert MaginnisIn June, Chinese military crackers, people who try to gain unauthorized access to computer networks as opposed to hackers who are simply computer enthusiasts, successfully gained access to a Pentagon computer network.

Thompson Makes It Officialby John GizziNow that Fred Thompson is in the race he needs to score heavily in his first week

Republicans Will Hold Democrats Accountable for Stolen Illegal Immigration Voteby Rep. John BoehnerHouse Republican Leader John Boehner on how the integrity of the House will be restored


The Missing Option in Our National Security Debateby Newt GingrichNext Monday, I will give a speech at the American Enterprise Institute (AEI) marking six years since 9/11 and outlining the larger war we should have been waging in order to defeat our terrorist enemies on a worldwide basis...

Stan Goff
The End Begins

Michael Dickinson
Working for Mother Teresa: Memoirs of a Rebellious Volunteer

Matthew Abraham
Standing Firm with Norman Finkelstein and DePaul's Heroic Students: a Defining Moment

Patrick Cockburn
The Basra Debacle

Dave Lindorff
Beware the Wounded Beast

Paul Craig Roberts
Who Are the Fanatics?

Syrian air defenses opened fire on Israeli aircraft that violated Syrian airspace overnight

Defense Minister Barak Warns: We are heading for a major ground operation to stamp out Palestinian missile attacks and curb the Hamas

Doublespeak and blurred vision: President Bush remains convinced of US success in Iraq. What further havoc will he wreak in his myopic approach to international relations?

GOP Hopefuls Clash With Ron Paul Over Iraq

Iraqi Judge Passes Sentence: 'Chemical Ali,' 2 others to be hanged


A change of direction: The common heritage between Bush and Stalin

Seven Years In Hell: The Years of the Bush Administration - Effects of Christian influence on Bush and the Neo-Cons examined

By George: now it's all the way with Howard J: Bush tells Australian leaders that America is "kicking a**" in Iraq

The Pakistani road to German terror

The three men arrested in Germany this week on suspicion of planning "massive" attacks on US interests in the country have been linked to training camps in Pakistan. Their likely commander there is al-Qaeda's Abu Hanifah, who operates in the North Waziristan tribal area, where al-Qaeda has re-established itself and where the US would dearly like to strike. - Syed Saleem Shahzad (Sep 6, '07)

US trashes Iran agreement at its own peril
The recent agreement between the International Atomic Energy Agency and Iran has been roundly criticized by US opinion makers but warmly praised by members of the Non-Aligned Movement. What's Washington's beef? The agreement provides a timetable for Iran to answer any of the IAEA's lingering questions, but it also leaves Iran's uranium enrichment program intact, and that is one concession too many as far as Washington hawks are concerned. - Kaveh L Afrasiabi (Sep 6, '07)


From al-Qaeda to al-Quds
The only guiding logic of the US far right in power is permanent war and any excuse will do for President George W Bush to attack Iran. The Iranian Revolutionary Guards Corps will retaliate and all of Iran, out of Persian national pride, will rally behind the supreme leader, President Mahmud Ahmadinejad and the theocratic police state. So much for regime change. - Pepe Escobar (Sep 6, '07)

Something to report on Iraq
Various reports on the war in Iraq will be released next week, and the interpretations of them will be contested widely and bitterly. The US military's assessment is sure to reflect its "can do" ideology, given that the future of the war and of the US position in the Middle East hinges on the reports and their reception. - Brian M Downing (Sep 6, '07)

In Fallujah, donkeys tell a tale
The Western media's portrayals of Fallujah, scene of a fierce battle in 2004, paint a picture of a pacified city. But in reality, Fallujah has all but slipped into the Dark Ages, with no electricity, no water, no fuel, few jobs and, by order of the US Army, no vehicular traffic. Who needs cars when there are donkeys? (Sep 6, '07)

CREDIT BUST BYPASSES BANKS
PART 2
Bank deregulation fuels abuse
The Glass-Steagall Act, born of the chaos and misery of the Great Depression, reined in the excesses longed for by the US financial services industry. Finally, in late 1999, the Clinton administration yielded to industry pressure and repealed the act. Today we see the result: a raging forest fire in the non-bank financial system that will present finance capitalism with its greatest test in eight decades. - Henry C K Liu
This is the final part of a two-part analysis

PART 1: The rise of the
non-bank financial system

NYT Shocker: Iran Poverty Even Worse Than U.S.
http://www.huffingtonpost.com/robert-naima...ty_b_63224.html

--
Robert Naiman
Just Foreign Policy
http://www.justforeignpolicy.org

Just Foreign Policy's current estimate of Iraqi deaths due to violence since the U.S. invasion - now more than a million:
http://www.justforeignpolicy.org/iraq/iraqdeaths.html

NEW YORK TIMES

9/6/07
A Prosecutorial Brief Against Israel and Its Supporters

WILLIAM GRIMES

THE ISRAEL LOBBY AND U.S. FOREIGN POLICY

By John J. Mearsheimer and Stephen M. Walt

484 pages. Farrar, Straus & Giroux. $26.

"The Israel Lobby and U.S. Foreign Policy" arrives carrying heavy baggage. John J. Mearsheimer, a political scientist at the University of Chicago, and Stephen M. Walt, a professor of international affairs at the John F. Kennedy School of Government at Harvard, set off a furor last year by arguing, in an article that appeared in The London Review of Books, that uncritical American support for Israel, shaped by powerful lobbying organizations like the American Israel Public Affairs Committee, does grave harm to both American and Israeli interests.

A bitter debate has raged ever since, with accusations of anti-Semitism leveled by, among others, Alan M. Dershowitz, the Harvard law professor, and Abraham H. Foxman, the national director of the Anti-Defamation League, one of the principal lobbying organizations taken to task by Mr. Mearsheimer and Mr. Walt.

"The Israel Lobby," an extended, more fully argued version of the London Review article, has done nothing to calm the waters. The authors have been barred from making appearances by at least one university and several cultural centers to discuss their subject, and continue to reap a whirlwind of criticism and abuse. If they were looking for a fight, they have found it.

Slowly, deliberately and dispassionately Mr. Mearsheimer and Mr. Walt lay out the case for a ruthlessly realistic Middle East policy that would make Israel nothing more than one of many countries in the region. On those occasions when Israel's interests coincide with America's, it should count on American support, but otherwise not. What Americans fail to understand, the authors argue, is that most of the time the two countries' interests are opposed.

The reason they do not realize this, Mr. Mearsheimer and Mr. Walt insist, can be explained quite simply: The Israel lobby makes sure of it. Working closely with members of Congress, public-policy organizations and journals of opinion, energetic, well-financed groups like the American Israel Public Affairs Committee and the American Jewish Committee, along with dozens of political-action committees, perpetuate the myth, as the authors see it, of Israel as an isolated, beleaguered state surrounded by enemies and in need of America's unstinting financial and military support.

This lobby is particularly adept at stifling debate before it begins, the authors argue. "Whether the issue is abortion, arms control, affirmative action, gay rights, the environment, trade policy, health care, immigration or welfare, there is almost always a lively debate on Capitol Hill," they write. "But where Israel is concerned, potential critics fall silent and there is hardly any debate at all."

There is nothing underhanded or devious about this, the authors say. Like the National Rifle Association or the AARP, the Israel lobby relies on the traditional political weapons available to any special-interest group in pressing its agenda. It just happens to be unusually skillful and effective.

"It is simply a powerful interest group, made up of both Jews and gentiles, whose acknowledged purpose is to press Israel's case within the United States and influence American foreign policy in ways that its members believe will benefit the Jewish state," they write.

The problem, Mr. Mearsheimer and Mr. Walt argue, is that Israel has become a strategic liability with the end of the cold war and a moral pariah in its dealings with the Palestinians and, most recently, the Lebanese. Uncritical American support for its closest Middle East ally has damaged American credibility in the Arab world, encouraged terrorism, stymied the search for a solution to the Palestinian problem, and in every way made America's international position weaker and more dangerous.

Coolly, not to say coldly, Mr. Mearsheimer and Mr. Walt mount a prosecutorial brief against Israel's foreign and domestic policies, and against the state of Israel itself. They describe a virtual rogue state, empowered by American wealth and might, that blocks peace at every turn, threatens its cowering neighbors with impunity, crushes the national aspirations of the Palestinians and, whenever the opportunity arises, bites the hand that feeds it.

Working tirelessly in the background is the Israel lobby, playing Iago to America's Othello, leading president after president down ever more dangerous paths. Without intense pressure from the Israel lobby, the authors argue, America would not have undertaken the war in Iraq.

Most American readers will bristle at the authors' characterization of Israel. This is to be expected, Mr. Mearsheimer and Mr. Walt argue, because of the completely false image of Israel and its history that has been manufactured by the Israel lobby. As a result, Americans completely misinterpret the Palestinian issue and fail to support a productive policy that would tilt away from Israel and toward the Palestinians.

The authors state, on several occasions, their belief that Israel has a moral and legal right to exist, but the effect of their book is to leave it dangling by a moral and strategic thread. In essence they call for the United States to cut Israel loose, to return more or less to American policy before the 1967 war, when the United States tried to occupy a middle ground between Israel and its Arab neighbors. Strangely, the authors do not itemize the fabulous benefits delivered by this approach in the 1950s and '60s.

It is a little odd that so chilly a book should generate such heat. Most of Mr. Mearsheimer and Mr. Walt's arguments are familiar ones, and it is hardly inflammatory to point out that the major Jewish organizations tend to take a much tougher line on, say, a two-state solution to the Palestinian problem, the Iraq war or settlements in the West Bank, than most American Jews favor. The writers stand on eminently defensible ground when they argue for a more constructive, creative American role in peace talks.

The general tone of hostility to Israel grates on the nerves, however, along with an unignorable impression that hardheaded political realism can be subject to its own peculiar fantasies. Israel is not simply one country among many, for example, just as Britain is not. Americans feel strong ties of history, religion, culture and, yes, sentiment, that the authors recognize, but only in an airy, abstract way.

They also seem to feel that, with Israel and its lobby pushed to the side, the desert will bloom with flowers. A peace deal with Syria would surely follow, with a resultant end to hostile activity by Hezbollah and Hamas. Next would come a Palestinian state, depriving Al Qaeda of its principal recruiting tool. (The authors wave away the idea that Islamic terrorism thrives for other reasons.) Well, yes, Iran does seem to be a problem, but the authors argue that no one should be particularly bothered by an Iran with nuclear weapons. And on and on.

"It is time," Mr. Mearsheimer and Mr. Walt write, "for the United States to treat Israel not as a special case but as a normal state, and to deal with it much as it deals with any other country." But it's not. And America won't. That's realism.

"Iran's Plan for Compliance," By Sharon Squassoni and Nima Gerami, Carnegie Analysis
• "Atomic Exports: German Technology Ends Up in Iranian Nuclear Plant," By Andreas Wassermann, Der Spiegel
• "Rogue Regulator," Op-Ed, The Washington Post
• "Sino-India Nuke Energy Cooperation Possible Under IAEA: Experts," The Hindu
• "The Perils of Non-Proliferation Amnesia," Op-Ed by William C. Potter and Jayantha Dhanapala, The Hindu
• "U.S. Bomber Mistakenly Flies With Nuclear Weapons," By Kristin Roberts, Reuters
• "Bush Says North Koreans Appear to Be Abiding By Nuclear Agreement," International Herald Tribune

TIME
9/5/07
Israel Weighs a War in Gaza

Tim McGirk

Jerusalem

As children in the southern Israeli town of Sderot toddled back to class after summer vacation on Monday, a Palestinian rocket exploded near a gaily painted kindergarten. None of the kids were hurt by the blast, but as one mother who rushed to the kindergarten says, "I found all the children terrified and in tears." They were treated for shock.

On Back to School day, seven rockets fired from the nearby Palestinian enclave of Gaza landed in Sderot, narrowly missing toddlers entering a kindergarten. The Palestinian militants routinely fire rockets from Gaza, but this time those responsible claimed to be retaliating for Israel killing three Palestinian children, who had been gathering fruit and playing hide and seek, the previous week. (The Israeli army had apologized for the three deaths.)

Palestinian rocket fire into Israel from Gaza has continued incessantly since 2003, and Israeli military planners and politicians know that it's only a matter of time before one of the crude homemade rockets hits a school or a supermarket, killing many Israelis.

On Tuesday, Prime Minister Ehud Olmert met with his security cabinet to figure out the terrible equation of how hard Israel should strike back against Gaza when one of these home-made rockets brings death to Sderot. The collateral damage could include President George W. Bush's proposed Middle East peace summit in November, since a major Israeli strike against Gaza would inevitably prompt a stay-away by the moderate Arab states on whose support Washington is counting — Egypt, Jordan and possibly Saudi Arabia.

Well-informed Israeli government sources told TIME that a debate is raging inside Olmert's cabinet over how fiercely Israel should strike Gaza, where 1.5 million Palestinians live densely packed. According to these sources, the hawks, including Deputy Premier Avigdor Lieberman and top military brass heading the South Command, are pressing for an all-out assault on Gaza. This would require four to five divisions of troops, and its aim would be to arrest the leaders of Hamas and destroy the Islamist militant group that seized control of the territory from U.S.-backed President Mahmoud Abbas's militia last June. A full-scale assault, say military strategists, might cause "over a thousand" Palestinian casualties and the loss of "a few hundred Israelis," but it would smash Hamas's military capability and seize an estimated 40 tons of explosives and tens of thousands of weapons, including anti-tank rockets and surface-to-air missiles.

The drawback: Such a raid would scuttle Bush's peace summit, and also leave the Israeli army dangerously over-stretched if war were to break out again in the north against either Hizballah or Syria.

The second scenario: Israel invades a broad swath of northern Gaza as far as the teeming Jabaliya refugee camp, pushing the rocketeers back out of range of Sderot and other Israeli communities. In this plan, Israel would also turn a corridor along the Philadelphi Road, between Gaza and Egypt, into a no-man's land to stop smugglers from bringing more weapons into Gaza through an underground maze of tunnels. Israel would also cut off Gaza's electricity, gas and water, in what deputy premier Haim Ramon described as "a price tag" that Israel should stick on every rocket fired by the Palestinians.

The downside to the second plan: Seizing northern Gaza would mean destroying hundreds of Palestinian houses and displacing thousands of families. It could also raise an international outcry that Israel was imposing a collective punishment on Gazans for having backed Hamas in last January's free elections. It is almost certain that President Abbas, despite his loathing of Hamas, would walk away from U.S. sponsored peace talks with the Israelis in protest. Hamas might also pull out longer-range missiles from its arsenal, able to strike as far as the Israeli port of Ashkelon.

Plan Three, said to be favored by Olmert and Defense Minister Ehud Barak, calls for occasional ground strikes into Gaza and an increase in assassinations of Hamas's political and military leadership. "It wouldn't be Ismael Haniyeh [the Hamas leader and ex-Prime Minister], but it would be those right under him," one source told TIME. Until now, Israel has refrained from targeting Hamas's political leadership since they are not involved in the rocket attacks on Israel — the rocketeers usually belong to Islamic Jihad and other smaller Palestinian militant groups. "We want Hamas on the run so that they can't attack us with rockets or suicide bombers," claimed this source.

Hamas, meanwhile, says it is not afraid of an Israeli siege on Gaza. "The Israelis will pay a heavy price," said one Hamas leader, who claimed that his militia had studied Hizballah's tactics against Israeli in last summer's Lebanon war. That may be bravado, but since its takeover of Gaza, Hamas has been busy fortifying itself against a possible Israeli attack. And Palestinian militants may get increased support from Iran. On Thursday, President Mahmoud Ahmedinejad is hosting a Palestinian militant jamboree with envoys from Hamas and other resistance groups. Israelis say Iran is providing Hamas with funds and military training.

The kindergarten rocket in Sderot narrowly missed causing a major battle between Israel and Gaza's Palestinians. It could be days, or even weeks before one rocket finds its mark. And when that happens, all bets for progress on Middle East peace this fall are off.
BACK TO TOP

<h3 align="center">An Own-to-Rent Solution
</h3>This morning, American Public Media's Marketplace Morning Report featured a story on Dean Baker and Andrew Samwick's own-to-rent plan for remedying the subprime mortgage crisis. You can read the transcript below or listen to the story online at http://marketplace.publicradio.org/shows/2...M200709061.html. In depth research on the housing bubble and its implications can be found on the Housing page of CEPR's website.

Transcript

Scott Jagow: This week, Congress is debating ways to help out homeowners stuck with awful mortgages. There are many ideas floating around. One in particular from economists Dean Baker and Andrew Samwick strikes our economics correspondent Chris Farrell. It's own-to-rent. OK, Chris, explain this.

Chris Farrell: The simple way is, Congress passes legislation and says the current homeowner has the right to stay in the home as long as they like. All they have to do is pay fair market rent. And of course under this plan, the homeowners turn over the property to the mortgage holder. So the mortgage holder does get the property, and it's a bailout that really protects the low-income homeowner who was sold a bill of goods.

Jagow: Do you really think that Congress would do something like this?

Farrell: You know, the idea is out there. See there's a real problem with bailouts and let's just use the word bailout loosely all right? You don't want to reward speculators and you don't want to reward lenders. You really want them to suffer, you want that pain. They deserve to go to the seventh circle of hell anyway right? Now, but you do want to protect the homeowner that was misled. The benefit of this idea is that it's the most targeted idea I've seen that helps out that person, doesn't throw them out on the street, doesn't force them to go through foreclosure, and at the same time forces the lenders and the speculators to take a financial hit.

Jagow: How exactly would this be a punishment in any way for the mortgage lenders?

Farrell: They are now landlords and it puts them in the landlord business and that's always a risk when you speculate and that's what the lenders were doing, were speculating, don't use any other word. But it does essentially say 'you know what, you're not going to foreclose on this property, you're not going to put this person out on the street, you're not going to be able to rewrite the terms of the mortgage loan by the way as long as that tenant meets the fair market value bill, you're a landlord.

Jagow: So do you do anything to help the mortgage lenders get through this?

Farrell: No. I don't see any reason why you should. Actually you know the Federal reserve is doing what it should do and I'm a big fan of what Ben Bernanke has been doing and I think all this whining from the hedge funds and Wall Street about the Fed needs to cut rates, look, the Fed's not in the business of bailing out these big banks. I mean look at the money that's been made. What was it last year, bonuses on Wall Street were what $60 billion? I think what we're going to see over the coming year or two is a Darwinian process of the market and as far as I'm concerned I hope a lot of people go out of business.

Jagow: Well maybe next time Chris you can share some strong opinions with us

Farrell: OK, I'll, I know that's sort of one of your demands. I'll try and live up to it.

Jagow: All right Chris thanks for joining us.

Farrell: Thank you.



Dean Baker is Co-Director of the Center for Economic and Policy Research, in Washington, D.C. (www.cepr.net).

Moderates seek to end Iraq impasse
By Noam N. Levey
The lawmakers want to change the course of the war but without a date for troop
withdrawal. But will the others go along?
http://email.latimes.com/cgi-bin1/DM/y/eBX...Io30G2B0IugX0Ew

Candidate who is not there upstages GOP debate
By Michael Finnegan and Mark Z. Barabak
The ex-Tennessee senator announces his presidential bid while his rivals debate.
http://email.latimes.com/cgi-bin1/DM/y/eBX...Io30G2B0IugY0Ex

It's Pakistan's choice
By Rajan Menon
As Pakistan's president, Pervez Musharraf, struggles to retain power, the United
States finds itself in a familiar predicament, one that illustrates a recurring
pathology in its foreign policy. Having yet again cast its lot with a strongman,
Washington is confounded now that his political position has become precarious.
It's the Anastasio Somoza, shah of Iran, Ferdinand Marcos dynamic in a different
guise. Though Musharraf won't be forced into exile like those friends of
Washington, the best he can hope for is to survive the current turmoil with
vastly reduced authority.
http://email.latimes.com/cgi-bin1/DM/y/eBX...Io30G2B0Iugq0EN

Don't miss the many interesting and compelling events coming up over the next few weeks. Unless otherwise noted, each free program is held in the spacious F. A. Hayek Auditorium here at the Cato Institute – 1000 Massachusetts Ave., NW – and is followed by a complimentary reception.


book forum
Until Proven Innocent: Political Correctness and the Shameful Injustices of the Duke Lacrosse Rape Case Tuesday, September 11, 2007 - Noon

Featuring the coauthor Stuart Taylor Jr., Senior Writer, National Journal, with comments by Victoria Toensing, Former Deputy Assistant Attorney General, Criminal Division, Justice Department.

About the event - The Duke lacrosse rape case, which dominated cable news shows for months, turned out to be one of the most shameful episodes of prosecutorial abuse in recent memory. Stuart Taylor and Prof. KC Johnson have just now drawn the vast material that surrounded the case into a riveting narrative that John Grisham said “smothers any lingering doubt that in this country the presumption of innocence is dead.”



book forum
Immigrants: Your Country Needs Them Wednesday, September 12, 2007 - Noon

Featuring the author, Philippe Legrain, with comments by Stuart Anderson, National Foundation for American Policy.

About the event - British author Philippe Legrain presents a comprehensive case for expanding the freedom of workers to cross international borders legally. Legrain examines the economic benefits of both high-skilled and low-skilled immigration and addresses the very concerns that blocked Senate passage of comprehensive immigration reform earlier this year. Comments will be provided by a leading U.S. immigration expert.

conference 6th Annual Constitution Day Monday, September 17, 2007- 10:00 a.m. Registration fee: $50

Speakers Include Roger Pilon, Vice President for Legal Affairs and Director, Center for Constitutional Studies, Cato Institute; Samuel Estreicher, Professor of Law, New York University School of Law; G. Marcus Cole, Professor of Law, Stanford Law School; Nicholas Quinn Rosenkranz, Associate Professor of Law, Georgetown University Law Center; Hon. Janice Rogers Brown, Circuit Judge, U.S. Court of Appeals for the D.C. Circuit.


The full program can be found online at www.cato.org/constitutionday


book forum
Feds in the Classroom: How Big Government Corrupts, Cripples, and Compromises American Education[b] [/b][b] Tuesday, September 18, 2007- Noon[/b]

Featuring the author, Neal McCluskey, Policy Analyst, Center for Educational Freedom, Cato Institute, with comments by Michael Petrilli, Vice President, National Programs and Policy, Thomas B. Fordham Foundation, and moderated by David Hoff, Associate Editor, Education Week.

About the event - Congress is working to reauthorize the No Child Left Behind Act, and prospects for meaningful reform are poor. After examining Washington’s education track record and the largely forgotten history of American schooling, Neal McCluskey concludes that only two things — ceasing federal education involvement and implementing universal school choice — can get our kids the education they need. Please join us for a discussion of this controversial thesis and what must be done to truly leave no child behind.

policy forum Assessing the Surge Thursday, September 20, 2007- 11 a.m.

Featuring Christopher Preble, Director of Foreign Policy Studies, Cato Institute; James Dobbins, Director, International Security and Defense Policy Center, RAND Corporation; Clifford D. May, President, Foundation for the Defense of Democracies; Marc Lynch, Professor of Political Science, George Washington University; and moderated by Ted Galen Carpenter, Vice President for Defense and Foreign Policy Studies, Cato Institute.


About the event - Despite the infusion of nearly 30,000 Army and Marine Corps personnel, Adm. Michael Mullen admits, “No amount of troops in no amount of time will make much of a difference” in Iraq if there is no effective Iraqi government. Are the objectives and benchmarks set for the Iraqi government achievable? How much longer should the United States give the surge to work before considering a change in policy?

policy forum Should the Government Insert Itself between Dying Patients and Unproven Therapies? Tuesday, September 25, 2007- Noon

Featuring J. Scott Ballenger, Partner, Latham & Watkins; Ezekiel J. Emanuel, Chair, Department of Clinical Bioethics, National Institutes of Health; and Michael F. Cannon, Director of Health Policy Studies, Cato Institute.

About the event - In Abigail Alliance for Better Access to Developmental Drugs v. Eschenbach, terminally ill patients won an impressive victory before a panel of the U.S. Court of Appeals for the D.C. Circuit. That panel ruled that when the government prevents terminally ill patients from accessing experimental drug treatments, it violates those patients' constitutionally protected right to save their own lives. On appeal, however, an en banc opinion from the D.C. Circuit overturned the panel opinion, setting the stage for an appeal to the Supreme Court. Please join our panelists as they discuss the economics, ethics, and constitutionality of allowing the state to stand between dying patients and unproven therapies.

policy forum Doing Business in Africa Wednesday, September 26, 2007- Noon

Featuring Strive Masiyiwa, CEO, Econet Wireless International and Henry Posner III, Chairman, Railroad Development Corporation.

About the event - Africa has the world's least welcoming business environment, but it is also a land of opportunity. Countless entrepreneurs battle stifling bureaucracies, pervasive corruption and political instability to provide their customers with the goods and services they need. Henry Posner and Strive Masiyawa are two such enterpreneurs. They will share their insights on doing business in Africa and their suggestions for reform.



To register for any event, please [b]click here, call 202.789.5229, or reply to this Email.[/b]

Troop Withdrawal: Looking Beyond Iraq
Friday, September 21, 2007


Speakers

Ivan Eland
Senior Fellow, the Independent Institute; author, The Empire Has No Clothes: U.S. Foreign Policy Exposed. Leon T. Hadar
Research Fellow at the Independent Institute and author of Sandstorm: Policy Failure in the Middle East (Palgrave Macmillan). David R. Henderson
Research Fellow at the Independent Institute and Hoover Institution; author of the new Independent Policy Report, Do We Need to Go to War for Oil?; Associate Professor of Economics, Naval Postgraduate School

Sooner or later the United States will begin withdrawing from Iraq. Will the result be a catastrophe for U.S. interests, or are such predictions overstated? Can we expect a wider regional war, a safe haven for al Qaeda in Iraq, or a disruption to America’s oil supplies? What can the United States do to minimize the risks of withdrawal? Is diplomacy with Syria, Iran, and other nations the answer? Could Iraq benefit from political decentralization or even gerrymandering for the equitable distribution of oil resources? With the new Independent Policy Reports, A Diplomatic Road to Damascus and Do We Need to Go to War for Oil?, this timely and far-reaching Policy Forum will feature foreign policy experts Ivan Eland, Leon T. Hadar, and David R. Henderson. Media Inquiries: please contact Ms. Wendy Honett, Publicity Manager, at (510) 632-1366 (ext. 116).

By Chris Laird
Sep 6 2007 10:26AM

www.prudentsquirrel.com

Over the last several years, there has been a lot of discussion about the size of the derivatives market, and how much it has grown since 1990. That market was around $20 trillion in size in ‘90, and now is estimated by the BIS to exceed $600 trillion world wide.

Given that amount is 10 or 12 times the entire world GDP of roughly $50 trillion a year, this amount of derivatives is just astounding. The fact is that world currencies are threatened if these go sour. We will get into this in a moment. First, let us discuss some derivative basics.

Derivatives proponents (brokers and bankers) have previously stated that the actual value of derivatives is a fraction of the actual total size, and that all the worry is overblown. The total size is called the ‘notional amount’. For example, if we decided to make a contract on the price of gold for 100 ounces, (a private futures contract between us) the notional amount would be 100 times the price of gold. If the price of gold rose $1, the value of that contract would be $100, but the notional amount is $68,000 (680*100). Derivatives proponents state the cry about the incredible notional amounts is over done, and try to get us to focus on the smaller ‘value’ amounts and not to worry.

Oh yes, we should worry!

Well, the fact is, when we hear of derivatives in $600 trillion amounts, the TRUTH is that this is the actual leverage out, and when values change, the value of the contract varies greatly - according to all that leverage. Notional amount is the actual amount being bet on, pure and simple. The de emphasis of gigantic notional amounts is mere smoke screen.

We have already seen what happened with the US mortgage derivatives, and how trouble in the subprime CDOs, SIVs, etc, spilled into other credit markets and caused panic and threatened systemic banking crises in the EU, US, and Canada. Right now, those central banks are vigorously trying to stem a meltdown in the money markets, as corporate paper (short term money for banks and companies) has pretty much stopped rolling over. The lenders in that market are afraid if they roll the paper over, they will be stuck with loans to companies banks and institutions who are hiding huge derivatives losses. If they roll over the paper (extend) then, if these borrowers go bankrupt, their CP becomes endangered.

This is why the Central banks are having a hard time convincing the CP markets to take advantage of their short term stop gap loans (via the discount window for example), and the central banks efforts to stem the credit meltdown is not working. In the EU for example, Libor (London interbank rates - short term money) rates have hit 9 year highs Tuesday - and bankers are saying that indicates the central bank efforts to revive the CP markets is not working. Bankers set rates among themselves - central banks can only offer their own money at CB rates, but they cannot force banks to loan it out. This is why the CP markets are still in severe trouble.

Bail outs?

We have heard the justified cries that central banks should not bail out all those reckless investors in derivatives, and their bankers and brokers. The trouble is, central banks may not have a choice, right or wrong. If derivative losses spread enough to paralyze the credit markets, then economies will grind to a halt. So, right or wrong, central banks probably have no choice but to try and stem the ongoing losses and credit crisis with bailouts.

Central banks will have to take on the huge losses

Now, we get to the heart of the matter. One of the ways the Fed was able to initially stem the most threatening problems from the mortgage derivatives mess was to buy the troubled stuff that no one wanted at book value. Eventually, central banks may find that is the only way they can stem the credit freeze. Just offering to loan central bank money to the system does not take the losses off peoples book’s.

Even if some short term action pushes some central bank money into the system, the losses stay and will have to be recognized at some point. So, this strategy by central banks of just loaning money will not work, and is only a very temporary stop gap measure. The existence of losses in people’s portfolios is what is stopping lenders from participating in the essential CP markets. If they even suspect someone has mortgage derivatives losses - they will not roll over the CP. The only solution? Central banks have to buy the bad assets (losing derivatives) at book value and take them off people’s hands outright. The Fed has been doing this, offering to take MBS and other non standard collateral for their money. Then, the troubled assets become the Central Bank’s problem.

Now, that amounts to monetization of losses. (Monetization is central banks buying out losses by printing the money for it.) This leads to serious trouble. A central bank can monetize some things, but it surely cannot monetize trillions and trillions of them over and over. If they do that, then the value of their own bonds collapses, and the currency devalues.

Now we get to some numbers. So far, the Fed, ECB, BOJ, and other central banks are all madly trying to flood money into the credit markets so CP will roll over. The trouble is, the CP markets are not normalizing, and eventually, these central banks will realize the only solution will be outright bail outs in gigantic amounts.

So far, CBs have already put out well over half a $trillion so far. We are probably going to see over a $trillion soon. With the notional amounts of derivatives in general exceeding $600 trillion world wide, we see a serious problem arising. You know, I would not expect the entire $600 trillion universe of derivatives to go bad, but, if even a fraction do, (they already are) then CBs end up being on the hook for trillions.

The problem is not made any easier by the fact that over 70% of all derivatives are OTC (over the counter - private one on one contracts). This is why the MBS and mortgage derivatives mess collapsed so fast, because there was no market for them. As losses spiraled out of control, no one wanted to touch them even at something like 5 cents on the dollar. The only solution? Central banks having to be buyers of last resort. The holders of these bad derivatives were forced to keep them on book - and then lost their own credit worthiness.

Another problem is that trouble in one sector of derivatives is like a loose cannon crashing around on the deck of ship in a storm. It spreads damage to other parts of the ship. Hopefully, the loose cannon crashes through the thwarts and falls into the sea….The sea in this case is all the nations’ central banks.

The derivatives ship

The derivatives ship is a multi deck aircraft carrier. Each deck is a sector of derivatives. Now, lets say, one sector of trillions of derivatives goes bad, and no one wants them. The holders (counterparties) then cannot offload them. Soon, the weight of mounting losses causes them to be unable to cover other derivatives they hold, and all of a sudden, the entire web of derivatives becomes in danger because the counterparties cannot now count on each other to cover their bets…The damage spreads from sector to sector, or to different decks.

All of a sudden, a systemic collapse emerges, and even if one institution has counterparties covering their losses (hedges) they find their hedges fail as the other party falls into insolvency.

Thus, the illiquid nature of OTC derivatives causes a gigantic systemic collapse. Right now, central banks are really afraid of this possibility. So far, central banks have NOT stemmed the crisis in CP markets. Libor rates prove that. Now, the CP market is the most vulnerable sector because it is money that has to roll over every 270 days or less. Considering that that market is 2.2 trillion in the US alone, and that it affects all aspects of commerce, we see we have a major problem on our hands. As of last week, about $250 billion of CP in the US has not rolled over (put another way, outstanding CP in the US has dropped by $250 billion, or over 10% of all of it!) in only 3 weeks!

Gold and the USD here

A couple of weeks ago, there was a stamped into US treasuries, and 3 month Treasury yields dropped up to 2% in one day. Eventually, those rates stabilized, but it showed flight into safety and into the USD. Another factor in play is that, as credit markets become illiquid, banks, institutions and companies hoard cash to operate. If they cannot roll over short term paper, they need cash. So, they hoard cash. This is happening right now in the European financial sector right now.

Gold is also benefiting from flight to safety. The advantage gold has in this situation is that, once people realize that Central banks will have to become buyers of last resort for $trillions of bad derivatives, they will prefer gold to actual currencies.

Gold is being whipsawed in two ways. One is flight into gold ultimately. The other is selling of gold during stock sell offs. Every time gold rallies right now, it is subject to panicky selling when investors need cash. And right now, everybody seems to need a lot of cash.

This story is only beginning, and I heard one good comment about this present derivatives / credit crisis that ‘the unwinding of credit and leverage will not be denied’. That means that all the leverage out there right now is subject to waves of unwinding. Considering all the leverage in the stock world, that does not bode well at all.

Will derivatives ultimately kill some currencies?

Now, given the fact that I don’t think Central banks can escape having to monetize more and more trillions worth of derivatives, the question arises ‘what will be the fate of major currencies?’

Central banks have a serious dilemma. If they let the financial system ‘take’ the losses, the credit markets freeze. That will just hammer world economic activity. If central banks do monetize all these growing losses (likely to snowball) then they threaten their own currencies. Both choices are quite bad. Can they work out of this mess? I don’t know. One thing for certain is they will have to act very soon. I think a consensus is building, that, as people begin to understand what is happening, they are going to start dumping some of the major currencies where the derivative losses are centered.

Ultimately, gold should benefit greatly in this situation, although it is subject to some panic selling when institutions need cash during equity crashes.

Also, considering the weakening US, Japanese, and EU economy due to credit contraction, we have one hell of a financial storm building on the horizon. It is a huge black cloud looming on the horizon in front of us. I can see no good reason to be staying in equity markets right now. Cash is definitely king at this time. (gold and precious metals are likely the best cash).

One final note, there has been some talk going around that commodities in general should benefit significantly as these currencies start to have trouble. One major reservation I have about that is that commodities are so sensitive to economic activity. If things really get out of hand in the financial world, I expect some significant economic slowing and falling demand for all the major commodities, and even possibly oil. The world equity bubbles are the only thing still keeping people spending. If those tank, the last standing source of profits for people is likely to start to evaporate. This is not going to be good for commodities.

We at PrudentSquirrel have been discussing getting liquid for months. We have anticipated the last 3 major world stock drops this year by up to 2 days in email alerts to subscribers. Subscribers have told me they would stay with Prudent Squirrel just for the alerts alone.

The Prudent Squirrel newsletter is a financial and gold commentary published 44 times a year. Subscribers also get mid week email alerts as needed.

Stop by and have a look.



Christopher Laird
Editor-in-Chief
www.PrudentSquirrel.com

The Jewish Daily FORWARD

CNN Comes Under Unprecedented Attack
Nathan Guttman | Wed. Sep 05, 2007

Washington - A CNN documentary about religious extremists has prompted an unprecedented outcry from the organized Jewish community, including a call to advertisers to pressure the network.



The three-episode special, "God's Warriors," by CNN's chief international correspondent, Christiane Amanpour, is being characterized by Jewish groups as equating Jewish extremists in West Bank settlements with Muslim jihadists. The program is also accused of containing numerous factual errors.

The Conference of Presidents of Major American Jewish Organizations, which represents more than 50 national Jewish organizations, convened a special discussion with its members following the airing of the program last month, and has urged them to take up the issue with companies that have bought advertising slots during the show.

In the past, there have been widespread complaints about the media's treatment of Israel, but this appears to be the first time that so many organizations have come together in opposition to a single media outlet.

"This was not an average show," said Jennifer Laszlo-Mizrahi, founder of The Israel Project. "CNN bought full-page ads promoting the show and ran it on prime time. The perspective the show left the viewers with is that Israel doesn't want peace and that Israel's friends in the United States don't want peace." The Israel Project, a group focused on providing information to the press and the public about Israel, broke a five-year tradition of not reacting to media reports on Israel and put out a press release about the Amanpour show, detailing Israel's efforts to promote peace in the region.

"The program definitely has a great damage potential because of the people who watch CNN," Laszlo-Mizrahi added, pointing to the fact that foreign officials and decision makers tend to view CNN as an important news source.

Relations between Jewish organizations and American media outlets were rocky during the first years of the intifada when Jewish activists protested outside almost every major media outlet and threatened to embark on reader boycotts. As violence on the ground died down, though, so did the tensions over media coverage. Now, "God's Warriors" has the potential of drawing the Jewish community into the media debate once again.

The vigorous response appears to be due, at least in part, to the coincidence of the program's screening just before the release of "The Israel Lobby and U.S. Foreign Policy," a book by scholars John Mearsheimer and Stephen Walt. The book levies serious charges against the power of the Jewish lobby which, it states, influences the United States to choose a foreign policy in favor of Israel against its own interest.

In the CNN program, among those interviewed are Mearsheimer and former president Jimmy Carter, who has been controversial in the Jewish community since the publication of his book, "Palestine: Peace Not Apartheid."

In a letter to CNN's vice president, the Anti-Defamation League's national director, Abraham Foxman, wrote: "The program made a huge and unfounded leap from legitimate pro-Israel advocacy in the U.S. to nefarious support for Jewish extremists."

The first episode of Amanpour's trilogy, titled "God's Jewish Warriors," dealt mainly with extreme Jewish settlers in the West Bank who vow never to leave the land because of biblical traditions and religious beliefs.

Amanpour interviews a member of the former Jewish underground who not only planted bombs in cars of Palestinian mayors but also plotted to blow up the mosques on the Temple Mount. In addition, the show deals extensively with the relations between Jewish settlers and Palestinians in the territories, and with the support for settler groups from Jewish and Christian groups in America.

Critics of the show point to a series of inaccuracies and claim that little was done to maintain a balance in choosing interviewees. But the main issue for media watchers is the equation that the series appears to make among extremists in all three major monotheistic religions.

"The whole setup from the start is false," said Andrea Levin, executive director of the Committee for Accuracy in Middle East Reporting in America — a media watchdog group that follows coverage of the Israeli-Arab conflict in American media outlets.

A CNN representative would not remark on the complaints of Jewish groups. The representative said that the network will respond directly to media-monitoring organization Camera and other groups that voiced concerns about the program.

The strongest reaction so far came from the Presidents Conference. An e-mail sent by its chair, June Walker, and Malcolm Hoenlein, its executive vice president, details steps taken by the Jewish community since the program aired. Conference members have asked CNN to avoid rerunning the show before concerns about factual errors and bias are addressed and corrected. It is also requesting that the network invest similar resources to produce a new program that would "rectify the bias and inappropriate context."

"We are aware of some advertisers that have already distanced themselves from 'God's Jewish Warriors,'" the e-mail reads. "It was recommended that all advertisers be contacted to express concern at their association with this offensive program."
Wed. Sep 05, 2007

Bush knew Saddam had no weapons of mass destruction
Salon exclusive: Two former CIA officers say the president squelched top-secret intelligence, and a briefing by George Tenet, months before invading Iraq.

By Sidney Blumenthal

Sep. 06, 2007 | On Sept. 18, 2002, CIA director George Tenet briefed President Bush in the Oval Office on top-secret intelligence that Saddam Hussein did not have weapons of mass destruction, according to two former senior CIA officers. Bush dismissed as worthless this information from the Iraqi foreign minister, a member of Saddam's inner circle, although it turned out to be accurate in every detail. Tenet never brought it up again.

Nor was the intelligence included in the National Intelligence Estimate of October 2002, which stated categorically that Iraq possessed WMD. No one in Congress was aware of the secret intelligence that Saddam had no WMD as the House of Representatives and the Senate voted, a week after the submission of the NIE, on the Authorization for Use of Military Force in Iraq. The information, moreover, was not circulated within the CIA among those agents involved in operations to prove whether Saddam had WMD.

On April 23, 2006, CBS's "60 Minutes" interviewed Tyler Drumheller, the former CIA chief of clandestine operations for Europe, who disclosed that the agency had received documentary intelligence from Naji Sabri, Saddam's foreign minister, that Saddam did not have WMD. "We continued to validate him the whole way through," said Drumheller. "The policy was set. The war in Iraq was coming, and they were looking for intelligence to fit into the policy, to justify the policy."

Now two former senior CIA officers have confirmed Drumheller's account to me and provided the background to the story of how the information that might have stopped the invasion of Iraq was twisted in order to justify it. They described what Tenet said to Bush about the lack of WMD, and how Bush responded, and noted that Tenet never shared Sabri's intelligence with then Secretary of State Colin Powell. According to the former officers, the intelligence was also never shared with the senior military planning the invasion, which required U.S. soldiers to receive medical shots against the ill effects of WMD and to wear protective uniforms in the desert.

Instead, said the former officials, the information was distorted in a report written to fit the preconception that Saddam did have WMD programs. That false and restructured report was passed to Richard Dearlove, chief of the British Secret Intelligence Service (MI6), who briefed Prime Minister Tony Blair on it as validation of the cause for war.

Secretary of State Powell, in preparation for his presentation of evidence of Saddam's WMD to the United Nations Security Council on Feb. 5, 2003, spent days at CIA headquarters in Langley, Va., and had Tenet sit directly behind him as a sign of credibility. But Tenet, according to the sources, never told Powell about existing intelligence that there were no WMD, and Powell's speech was later revealed to be a series of falsehoods.

Both the French intelligence service and the CIA paid Sabri hundreds of thousands of dollars (at least $200,000 in the case of the CIA) to give them documents on Saddam's WMD programs. "The information detailed that Saddam may have wished to have a program, that his engineers had told him they could build a nuclear weapon within two years if they had fissile material, which they didn't, and that they had no chemical or biological weapons," one of the former CIA officers told me.

On the eve of Sabri's appearance at the United Nations in September 2002 to present Saddam's case, the officer in charge of this operation met in New York with a "cutout" who had debriefed Sabri for the CIA. Then the officer flew to Washington, where he met with CIA deputy director John McLaughlin, who was "excited" about the report. Nonetheless, McLaughlin expressed his reservations. He said that Sabri's information was at odds with "our best source." That source was code-named "Curveball," later exposed as a fabricator, con man and former Iraqi taxi driver posing as a chemical engineer.

The next day, Sept. 18, Tenet briefed Bush on Sabri. "Tenet told me he briefed the president personally," said one of the former CIA officers. According to Tenet, Bush's response was to call the information "the same old thing." Bush insisted it was simply what Saddam wanted him to think. "The president had no interest in the intelligence," said the CIA officer. The other officer said, "Bush didn't give a fuck about the intelligence. He had his mind made up."

But the CIA officers working on the Sabri case kept collecting information. "We checked on everything he told us." French intelligence eavesdropped on his telephone conversations and shared them with the CIA. These taps "validated" Sabri's claims, according to one of the CIA officers. The officers brought this material to the attention of the newly formed Iraqi Operations Group within the CIA. But those in charge of the IOG were on a mission to prove that Saddam did have WMD and would not give credit to anything that came from the French. "They kept saying the French were trying to undermine the war," said one of the CIA officers.

The officers continued to insist on the significance of Sabri's information, but one of Tenet's deputies told them, "You haven't figured this out yet. This isn't about intelligence. It's about regime change."

The CIA officers on the case awaited the report they had submitted on Sabri to be circulated back to them, but they never received it. They learned later that a new report had been written. "It was written by someone in the agency, but unclear who or where, it was so tightly controlled. They knew what would please the White House. They knew what the king wanted," one of the officers told me.

That report contained a false preamble stating that Saddam was "aggressively and covertly developing" nuclear weapons and that he already possessed chemical and biological weapons. "Totally out of whack," said one of the CIA officers. "The first [para]graph of an intelligence report is the most important and most read and colors the rest of the report." He pointed out that the case officer who wrote the initial report had not written the preamble and the new memo. "That's not what the original memo said."

The report with the misleading introduction was given to Dearlove of MI6, who briefed the prime minister. "They were given a scaled-down version of the report," said one of the CIA officers. "It was a summary given for liaison, with the sourcing taken out. They showed the British the statement Saddam was pursuing an aggressive program, and rewrote the report to attempt to support that statement. It was insidious. Blair bought it." "Blair was duped," said the other CIA officer. "He was shown the altered report."

The information provided by Sabri was considered so sensitive that it was never shown to those who assembled the NIE on Iraqi WMD. Later revealed to be utterly wrong, the NIE read: "We judge that Iraq has continued its weapons of mass destruction (WMD) programs in defiance of UN resolutions and restrictions. Baghdad has chemical and biological weapons as well as missiles with ranges in excess of UN restrictions; if left unchecked, it probably will have a nuclear weapon during this decade."

In the congressional debate over the Authorization for the Use of Military Force, even those voting against it gave credence to the notion that Saddam possessed WMD. Even a leading opponent such as Sen. Bob Graham, then the Democratic chairman of the Senate Intelligence Committee, who had instigated the production of the NIE, declared in his floor speech on Oct. 12, 2002, "Saddam Hussein's regime has chemical and biological weapons and is trying to get nuclear capacity." Not a single senator contested otherwise. None of them had an inkling of the Sabri intelligence.

The CIA officers assigned to Sabri still argued within the agency that his information must be taken seriously, but instead the administration preferred to rely on Curveball. Drumheller learned from the German intelligence service that held Curveball that it considered him and his claims about WMD to be highly unreliable. But the CIA's Weapons Intelligence, Nonproliferation, and Arms Control Center (WINPAC) insisted that Curveball was credible because what he said was supposedly congruent with available public information.

For two months, Drumheller fought against the use of Curveball, raising the red flag that he was likely a fraud, as he turned out to be. "Oh, my! I hope that's not true," said Deputy Director McLaughlin, according to Drumheller's book "On the Brink," published in 2006. When Curveball's information was put into Bush's Jan. 28, 2003, State of the Union address, McLaughlin and Tenet allowed it to pass into the speech. "From three Iraqi defectors," Bush declared, "we know that Iraq, in the late 1990s, had several mobile biological weapons labs ... Saddam Hussein has not disclosed these facilities. He's given no evidence that he has destroyed them." In fact, there was only one Iraqi source -- Curveball -- and there were no labs.

When the mobile weapons labs were inserted into the draft of Powell's United Nations speech, Drumheller strongly objected again and believed that the error had been removed. He was shocked watching Powell's speech. "We have firsthand descriptions of biological weapons factories on wheels and on rails," Powell announced. Without the reference to the mobile weapons labs, there was no image of a threat.

Col. Lawrence Wilkerson, Powell's chief of staff, and Powell himself later lamented that they had not been warned about Curveball. And McLaughlin told the Washington Post in 2006, "If someone had made these doubts clear to me, I would not have permitted the reporting to be used in Secretary Powell's speech." But, in fact, Drumheller's caution was ignored.

As war appeared imminent, the CIA officers on the Sabri case tried to arrange his defection in order to demonstrate that he stood by his information. But he would not leave without bringing out his entire family. "He dithered," said one former CIA officer. And the war came before his escape could be handled.

Tellingly, Sabri's picture was never put on the deck of playing cards of former Saddam officials to be hunted down, a tacit acknowledgment of his covert relationship with the CIA. Today, Sabri lives in Qatar.

In 2005, the Silberman-Robb commission investigating intelligence in the Iraq war failed to interview the case officer directly involved with Sabri; instead its report blamed the entire WMD fiasco on "groupthink" at the CIA. "They didn't want to trace this back to the White House," said the officer.

On Feb. 5, 2004, Tenet delivered a speech at Georgetown University that alluded to Sabri and defended his position on the existence of WMD, which, even then, he contended would still be found. "Several sensitive reports crossed my desk from two sources characterized by our foreign partners as established and reliable," he said. "The first from a source who had direct access to Saddam and his inner circle" -- Naji Sabri -- "said Iraq was not in the possession of a nuclear weapon. However, Iraq was aggressively and covertly developing such a weapon."

Then Tenet claimed with assurance, "The same source said that Iraq was stockpiling chemical weapons." He explained that this intelligence had been central to his belief in the reason for war. "As this information and other sensitive information came across my desk, it solidified and reinforced the judgments that we had reached in my own view of the danger posed by Saddam Hussein and I conveyed this view to our nation's leaders." (Tenet doesn't mention Sabri in his recently published memoir, "At the Center of the Storm.")

But where were the WMD? "Now, I'm sure you're all asking, 'Why haven't we found the weapons?' I've told you the search must continue and it will be difficult."

On Sept. 8, 2006, three Republican senators on the Senate Select Committee on Intelligence -- Orrin Hatch, Saxby Chambliss and Pat Roberts -- signed a letter attempting to counter Drumheller's revelation about Sabri on "60 Minutes": "All of the information about this case so far indicates that the information from this source was that Iraq did have WMD programs." The Republicans also quoted Tenet, who had testified before the committee in July 2006 that Drumheller had "mischaracterized" the intelligence. Still, Drumheller stuck to his guns, telling Reuters, "We have differing interpretations, and I think mine's right."

One of the former senior CIA officers told me that despite the certitude of the three Republican senators, the Senate committee never had the original memo on Sabri. "The committee never got that report," he said. "The material was hidden or lost, and because it was a restricted case, a lot of it was done in hard copy. The whole thing was fogged up, like Curveball."

While one Iraqi source told the CIA that there were no WMD, information that was true but distorted to prove the opposite, another Iraqi source was a fabricator whose lies were eagerly embraced. "The real tragedy is that they had a good source that they misused," said one of the former CIA officers. "The fact is there was nothing there, no threat. But Bush wanted to hear what he wanted to hear."

http://www.salon.com/opinion/blumenthal/20..._wmd/print.html


_______________________________________________

Christopher Furlong / Getty Wheat waits to be harvested in a field in the Cheshire countryside, England.

http://www.time.com/time/world/article/0,8...wsletter-weekly

1. Global Warming's Next Victim: Wheat By Bryan Walsh Floods and droughts have pushed world wheat prices to record levels, and the problem threatens to get a lot worse

2. The Darker Side of Owen Wilson By Rebecca Winters Keegan The alleged suicide attempt by the actor, known for his happy-go-lucky characters, shocks the movie industry

3. John Edwards Bets the Farm By ERIC POOLEY John Edwards is pinning his presidential hopes on Iowa, a place where he and the voters really do see eye to eye

4. A Last Honor for Pavarotti? By Jeff Israely Being awarded the first ever Excellence in Italian Culture prize may be a sign that the great tenor is fighting for his life

<