The Iraq Cash Cow
As Republican war hawks call for yet more blood and treasure to be spilled on the sands of Mesopotamia, oil prices spike and military-industrial overlords prepare to milk the US Treasury for yet more contracts.
by Dean Henderson
Iraqi Prime Minister Nouri al-Maliki has refused to accept a salvation government as his army continues to conduct mop-up operations against ISIL Takfiri militants. Press TV reports that ISIL forces were trained at secret CIA camps inside Jordan. ISIL uses US and Saudi-supplied weapons.
As Republican war hawks call for yet more blood and treasure to be spilled on the sands of Mesopotamia, oil prices spike and military-industrial overlords prepare to milk the US Treasury for yet more contracts.
War is business and business is good. For the banksters, permanent war has been the antidote to a deflationary death spire and the jail time that would surely follow.
As Ralph Lewis – senior consultant for Chevron Texaco – once stated, “The trick in the Middle East is to keep it stirred up.”
Lewis’ comments mirror statements made in a Council on Foreign Relations (CFR) publication titled, The Middle East in the New World Economic Order. The article appeared in the CFR’s Foreign Affairs, which is read religiously at the State Department. The most telling sentence reads, “The US wants maximum tension between Middle East OPEC countries.”
The Iran/Iraq War decimated both OPEC price hawk countries, but the “maximum tension” wasn’t over yet. US war ships crowded into the Persian Gulf. A massive US militarization of Saudi Arabia and the GCC countries was under way. The stench of war was in the air again. Saudi Arabia and Kuwait had loaned Saddam Hussein $120 billion to prosecute his war in Iran. Now the creditors came calling.
With oil prices in the gutter due to GCC overproduction, Iraq was forced to embark on a massive privatization campaign, selling off state assets to obtain the hard currency needed to pay off its debts. This hit at the heart of the Iraqi people who took pride in the nationalization of the Iraqi Petroleum Company, previously owned by the Four Horsemen. For decades Iraq had guarded its resources from multinational corporations, becoming the most modern and prosperous nation in the Middle East. Now the international bankers were swarming like vultures. Iraq’s agricultural sector was sold to the highest bidder, leaving many farmers impoverished. Labor unions were banned. Foreign investment, disallowed since 1964, flowed into the country. Local elites bought up state-owned factories.
In 1989 the US/Iraq Business Forum was established. Facilitating its formation was Kissinger Associates – a private consulting firm founded by Henry Kissinger. President Bush Sr. had just taken office. He included two former directors of Kissinger Associates in his cabinet – Undersecretary of State Lawrence Eagleburger and National Security Adviser Brent Scowcroft.
The US/Iraq Business Forum was the vehicle through which US corporations gained access to the newly liberalized Iraq economy. Its members included Bechtel, Fluor, GM, Texaco, Occidental Petroleum, Westinghouse and AT&T. That same year Atlanta-based Banca Nacionale de Lavaro (BNL) approved $3 billion in loans to arm Saddam. More than $360 million in US taxpayer money ended up in Gulf International Bank, a Saudi/Iraqi venture in Bahrain.
BNL’s International Advisory Board included David Rockefeller who, according to economist Paul Adler, met on at least three occasions with Saddam Hussein. Chase Manhattan led a consortium that financed the US/Iraq Business Forum.
Iraq’s attempts at privatization proved a dismal failure. State assets were auctioned off for pennies on the dollar, oil prices remained low and Iraq spent the little money it made through the sales rebuilding an Iraqi economy devastated by the war with Iran, which left 750,000 Iraqis dead.
Saddam Hussein took a left turn, a la Noriega, and railed against US imperialism. As City of London mercenaries now known as ISIL – their previous name ISIS apparently being too obviously creepy – soften up Iraq for partition, the geopolitical energy derby continues apace.
The plan was always to seize the Kirkuk oilfields in the north by declaring a new nation of Kurdistan. The partition of Basra in the south will also be required, for here lies the giant Rumaila oilfield – the biggest prize of all. Baghdad and the middle of the country will be left to the Iraqis – impoverished and war torn – with the phony Sunni/Shia split fully exploited. There is no oil here.
While Saddam was preoccupied with the Iranians, the Kuwaiti government busied itself slowly moving its long-disputed border with Iraq northward into the area containing the massive Rumaila oilfield, which the Four Horsemen now knew to be one of the richest in the world. There the Kuwaitis established military installations, farms and oil facilities. The expansion added 900 square miles to Kuwait and gave them control over the southern portion of Rumaila, which contains the largest portion of its estimated 30 billion barrels of oil. Iraq’s oil terminal at Fao was destroyed during the Iran/Iraq War, crippling INOC production at North Rumaila. Iraq wanted to lease the islands of Warbah and Bubiyan from Kuwait to serve as deep sea ports that could replace Fao. The Kuwaitis refused.
In 1981 the Kuwait Oil Company (KOC) bought Sante Fe Drilling Corporation and its high-tech engineering subsidiary Braun. Sante Fe was a known CIA front. Braun had devised a new slant drilling technique. Throughout the 1980’s KOC used this technology to drill horizontally into the Rumaila oilfield, 90% of which fell within Iraqi territory. [494] The Iraqis said Kuwait stole $10 billion worth of crude oil.
After the Gulf War, Sante Fe continued to steal Iraqi oil. In April 1993 Kenneth Beaty, head of exploration for Sante Fe, was arrested by the Iraqi government when he was found inside Iraq checking an oil well at Rumaila. He was sentenced to eight years at Abu Ghraib prison on trespassing charges. [495] Estimates of Iraqi crude reserves continue to climb. The current estimate is 112 billion barrels, second only to Saudi Arabia and up from 97 billion barrels just a decade ago. And much of Iraq remains unexplored. David Mangan Jr., editor of The Oil Daily, later said of the Gulf War, “It is most likely that the US plan from the beginning was to capture Southern Iraq because that land holds the richest oil fields on earth.”
Rumaila lies at the heart of what was Mesopotamia, between the Tigres and Euphrates Rivers that drain into the Persian Gulf. The world’s most ancient writings are etched on Sumerian clay tablets buried beneath the muck at the estuaries of these great rivers. During biblical times the area was known as Chaldea. It was here, Anunnaki researchers say, where the Nubirian intruders chose to land, due to its plentiful supply of fossil fuels.
According to foremost Anunnaki researcher Zecharia Sitchin, the Anunnaki constructed the Great Pyramids in Egypt as space beacons. NASA scientist Maurice Chatelain agrees, stating, “The Great Pyramid at Cheops was also a space beacon. From high above, the pyramid is visible at a very great distance…the polished stone surface is a radar reflector.” The Anunnaki landing facilities may have been in the Sinai Peninsula. Sinai means “shining” and, derived from name of the Babylonian god “Sin”. Sin was also the Semetic name for Nannar, the firstborn son of Anunnaki leader Enlil, who was the sovereign of Ur, the home city of Ancient Mystery purveyor and possible Anunnaki hybrid Abraham. Sin was also the Chaldean name for the moon where, according to Sumerian tablets, the Anunnaki obtained the needed DNA for their human hybrid experiments. This adds a whole new meaning to the Old Testament mantra that man was born in sin. [496]
Researchers claim the Egyptian King Ra was actually Marduk, son of Anunnaki commander Enki. Ra fathered Shu and Tefnut, who married each other and gave birth to Geg and Nut. They too married and spawned the Egyptian god-kings Isis and Osirus, along with the biblical Seth and Nephtys. The Anunnaki flight control center was at Mount Moriah, which translates “mount of directing”. [497] It was on this exact sight that King Solomon built his Temple, under which the Knights Templar excavated during the Crusades, making off with boatloads of gold, the Ark of the Covenant (possibly an Anunnaki radio transmitting device) and other sacred relics now guarded by the Priory of Sion.
This southern portion of Iraq may contain valuable clues as to the origins of mankind, knowledge closely guarded by the Illuminati banker-led secret societies. The perpetual state of war with Iraq has put the area off limits to researchers, just as the number of people interested in the Anunnaki theories gains critical mass.
In June 1990 Iraq’s Ambassador to the US Mohammed al-Moshat appeared on CNN revealing US/Kuwaiti collaboration in destabilizing Iraq’s economy. Al-Moshat stated, “I have documents written by the CIA, detailing an economic destabilization program against Iraq involving Kuwaiti State Security. On November 14, 1989 CIA Director William Webster invited KSS officials to Washington to plan this destabilization effort.”[498]
Al-Moshat read verbatim from the CIA document, which stated, “It is important to take advantage of the deteriorating economic situation in Iraq in order to put pressure on Iraq to delineate border situation. Broad cooperation should be initiated between us. The CIA will also train 128 elite Kuwaiti forces to protect the al-Sabah family. And we will help automate functions of the State Security Department and facilitate the exchange of information with Syria and Iran.”[499] Al-Moshat went on to say that Kuwait’s oil wealth was being deployed to bankroll mujahadeen rebel heroin trafficking in the Golden Crescent region. Just months before Moshat made this claim, a nephew of Kuwaiti emir Sheik Jaber Ahmed al-Sabah was arrested in France for possession of heroin.
Part of the CIA/al-Sabah destabilization effort against Iraq involved driving world oil prices lower. At a May 1990 Arab Summit in Baghdad, Saddam Hussein said that for every $1 drop in the price of a barrel of oil Iraq was losing $1 billion/year. He called Kuwaiti overproduction of crude an “act of war”. Two months later he lodged a formal complaint with the Arab League calling Kuwait and UAE “imperialist agents” in the Gulf. King Hussein of Jordan concurred. In July 1990 OPEC held a meeting of oil ministers in Vienna where it was agreed that each member nation would lower production to avert further declines in an already weak oil market.
A day after the meeting Kuwait announced that it had changed its mind and would increase production. KOC flooded an already oversupplied market with $13.25/barrel Kuwaiti Export crude. The UAE followed suit. Within three months Iraqi crude went from $28/barrel to $11, resulting in a loss of $14 billion in oil revenues. Iraq’s economy is oil-dependent. In 1988 oil provided 99.1% of Iraq’s hard currency[500] Reeling under mountains of Iranian War debt, Iraq was now starved of the desperately needed foreign exchange required to service this debt and rebuild its shattered economy.
Iraqi Foreign Minister Tariq Aziz penned a letter to the Secretary General of the League of Arab States complaining that Kuwait had, “implemented a plot to escalate the pace of the gradual, systematic advance toward Iraqi territory. The Kuwaiti government set up military installations, police posts, oil installations and farms on Iraqi territory”. But Aziz knew that a more powerful force stood squarely behind Kuwait’s audacious moves, stating, “We are sure that some Arab states are involved in a conspiracy against us. And we want you to know that our country will not kneel and our women will not become prostitutes and our children will not be barred from food. It is inconceivable that a regime such as that in Kuwait could risk engaging in a conspiracy of such a magnitude against a large, strong country such as Iraq if it were not being supported by a great power, and that power is the United States of America”.
While Iraq’s greatest oilfield was being partitioned by the Four Horsemen and their Kuwaiti surrogates, the al-Sabah fiefdom was driving the price of oil into the ground, while demanding full repayment of the Iraq “grants”. In July 1990, as American warships conducted exercises in the Persian Gulf, Iraqi President Hussein met in Baghdad with US Ambassador to Iraq April Glaspie. Saddam registered his anger towards Kuwait’s economic warfare against Iraq. He told Glaspie he was considering taking military action against Kuwait to drive them out of the Rumaila oilfield.
Glaspie said nothing to discourage Saddam, instead telling him, “We have no position regarding Arab/Arab conflicts”. On July 31 Assistant Secretary of State John Kelly gave his implicit blessing to Saddam’s plans saying, “We have no defense treaty relationship with any Gulf country. That is clear…we have historically avoided taking a position on border disputes”.
Glaspie and Kelly were both lying and giving Saddam the green light to attack Kuwait. A few days later Iraqi Revolutionary Guards routed the Kuwaiti’s from Rumaila. Both a letter penned by President Bush to Saddam on July 28 and State Department instructions to Glaspie were withheld from a Senate committee investigating Glaspie’s and Kelly’s odd responses to Iraqi threats. State Department spokesman Richard Boucher said the documents were withheld to “permit Presidents and foreign leaders to talk freely”.
Shortly after Iraq attacked Kuwait Jordan’s King Hussein joined with Algerian President Chadli Benjladid to organize an Arab League Summit in Algiers to try and head off a full-scale war. Saddam agreed to pull his troops from Kuwait while the summit proceeded. But Egypt, with backing from the US and Britain, convinced 14 of the 21 foreign ministers in attendance to denounce Iraq. The peace effort fell apart. The Bilderbergers would have their bloodbath.
On October 5, 1990 Iraq’s Ambassador to the UN Sabah Talat Kadrat stated to the General Assembly, “America and its Western allies are seeking, through this military, political and informational campaign; to gain control over the oil wells and to impose imperialist political, economic and military hegemony over the world, and over the Third World countries in particular.”
Al-Sabah Yellow Ribbons
Turkey followed US orders to shut down a key Iraqi oil pipeline. King Fahd agreed to allow US troops to base out of Saudi Arabia. UAE and Qatar followed suit. President Bush announced a $7.8 billion sale of F-15 fighters, M-60 tanks and Stinger missiles to Saudi Arabia; along with a letter of intent locking the Saudis into another purchase of 315 M-1 tanks worth $3 billion. He announced a $1.2 billion increase in military aid to Israel. Military sales to Egypt were expedited. A month later Bush announced another $20 billion in arms sales to the Saudis.
UN Security Council Resolution 678, authorizing use of force against Iraq, passed on November 29, 1990 in a 15-1 vote. Despite additional peace attempts by France and Russia, bombs began raining down on Iraq in January 1991. On January 29th French Defense Minister Chevenment resigned in protest. Russia and Egypt accused the US of exceeding its UN mandate. Protests erupted worldwide. In Morocco 300,000 people marched in Marrakech. In San Francisco, nearly a million Americans did the same.
The al-Sabah family hired PR firm Hill & Knowlton (HK) to polish up the image of the monarchy and to promote the Gulf War. The $10.5 million HK effort, the biggest PR contract ever, included the yellow ribbon campaign, aimed at dividing the US anti-war movement. HK sponsored Kuwaiti Ministers who appeared at the National Press Club and put out a book titled The Rape of Kuwait. HK papered the walls of the UN Security Council chamber with oversized photos of tortured Kuwaitis. They created Citizens for a Free Kuwait, which sponsored witnesses who lied to Congress about alleged Iraqi atrocities in Kuwait. The star witness was the 15-year-old daughter of Kuwait’s US Ambassador, who gave heart rendering testimony of Iraqi soldiers grabbing Kuwaiti babies from hospital incubators. A 60 Minutes investigation later proved these stories to be total lies. [504]
President Bush’s Chief of Staff Craig Fuller had been CEO of HK. The head of HK’s US division was Robert Gray, an October Surprise insider who ran the Reagan inaugural. HK’s clients included the Chinese government and Indonesia’s Suharto regime. Kuwait also hired PR firms Rendon ($100,000/month), Neill & Company ($50,000/month) and Pintak/Brown International ($20,000/month). PR firm Keene, Shirley sponsored talk show appearances by former US Ambassador to Bahrain Sam Zakhom, who co-chaired the Coalition for America at Risk, which had touted the Nicaraguan contras. Zakhom’s group advertised an emergency action kit which targeted anti-war protesters. Kuwaiti Sheik Fahd al-Sabah, chair of the Kuwait Investment Office, said Kuwait and Saudi Arabia sent $4 billion to the US as secret payoffs to protect their Kingdoms. The money was diverted into a London slush fund that financed the HK-led propaganda effort.
On February 23rd, 1991 the US launched its ground assault. Bush had drawn his “line in the sand” between advancing Iraqi troops and the oil interests owned by son George W.’s Harken Energy. In 1990 the US signed a secret agreement with Bahrain, in whose territorial waters the Harken concessions were located, allowing for permanent US military bases in the country. One battalion of troops prosecuting the ground assault went straight to secure the Rumaila oilfield. Within two days the Iraqis surrendered.
Despite US propaganda that it would arm the Shi’ites in the south and the Kurds in the north to overthrow Saddam Hussein, US military forces were ordered to stand down only one mile from where Hussein unleashed his Republican Guard on the Shi’ites. The Bush Administration refused to meet with the Joint Action Committee formed by Iraqi opposition groups. [505] Instead, Bush formed the Free Iraq Council with the Saudis, which consisted of members of Hussein’s own Ba’ath Party. The US wanted Saddam left in place to serve as justification for yet another US military buildup in the Persian Gulf designed to protect Four Horsemen oilfields. On March 3rd, a week after the Iraqis surrendered, the US announced an agreement with Saudi Arabia allowing a permanent US military presence in the Kingdom.
Contracts for Vampires
As oil historian Daniel Yergin put it, “What we had before the war was a special relationship with Saudi Arabia. Now we have a more special relationship”. In 1988 ARAMCO announced its intention to pair up with its Four Horsemen parents in building downstream oil ventures. On March 21, 1990 there was a low-profile meeting between ARAMCO executives and leaders of the world’s six largest engineering firms – Bechtel, Fluor, Foster Wheeler, MW Kellogg, Asea Brown Boveri and Lummus Crest. At the gathering ARAMCO unveiled plans for a major expansion of the Saudi oil industry, yielding $10-$15 billion in construction contracts for the firms. The expansion increased refining capacity at the Bechtel-built Ras Tanura refinery by 25%, amplifying ARAMCO hegemony over world oil prices. [506]
Four months later, as US Ambassador April Glaspie was giving Saddam the green light to attack Kuwait, Fluor received the biggest ARAMCO contract, positioning the company to undertake any oilfield reconstruction in the Kingdom should the Iraq/Kuwait tensions spill over into Saudi Arabia. [507] Fluor is an ARAMCO old hand. They operate Fluor Arabia with the Saudi Juffali family and built two Big Oil petrochemical complexes at Jubail Industrial City. Kuwaiti officials had talked with Fluor before the Gulf War even began, but later chose Bechtel as lead contractor in rebuilding Kuwaiti oil infrastructure after Operation Desert Storm. [508] Most of the damage to Kuwait’s oil facilities was not from Iraqi troops, but from US bombing raids which supposedly missed their mark. Considering Bechtel’s political connections to the State Department and the billions it made rebuilding Kuwait, one has to wonder if the bombing was not intentional.
The ARAMCO expansion was underway. In August 1990 the Saudis produced 5.3 million barrels of oil a day. Throughout the Gulf War Saudi crude production increased, peaking at 8.5 million barrels a day. The ARAMCO increase represented 50% of the world increase in oil production that occurred during the Gulf War. The Four Horsemen accounted for the rest, eager to turn cheap crude into expensive finished product. RD/Shell greatly expanded its refinery at Tabangao in the Philippines in December 1990. [509]
The ARAMCO expansion paralleled a massive US military buildup which began in 1986 when Iran gained advantage in its war with Iraq. Defense contractors led by Raytheon, manufacturer of the Patriot missile, received hours of free advertising as the world watched a CNN light show that allegedly showed Patriots knocking down Iraqi Scud missiles. Later the Pentagon admitted that hardly any of the Scuds were hit. Nevertheless, the stocks of defense giants Raytheon, Northrup Grumman and Lockheed Martin soared during the Gulf War. The Bush Administration didn’t even count Gulf War expenses in its 1991 military budget, while the Pentagon set aside $16 billion in “off-budget post-war” expenses as well. When the war began, the Pentagon played on the patriotic fervor gripping the nation to announce several new weapons systems.
The Pentagon awarded a $688 million dollar contract to Lockheed Martin for a mobile ground-based missile defense system known as THAAD. Two battalions of THAAD ended up slightly over-budget costing $6 billion. Rockwell International began testing its new X-31 fighter, while McDonnell Douglas offered up its X-32 at a price tag of $120 million each. Lockheed Martin joined forces with Boeing and General Dynamics in procuring a $95 billion contract to develop its YF-22 Advanced Tactical Fighter. The only flyable prototype crashed at Edwards Air Force Base in April 1992. [510] General Dynamics was given $2.9 billion for its Seawolf submarine program. Boeing-Sikorsky got $34 billion to develop its LH helicopter. McDonnell Douglas received $82 billion for its Tomahawk missile system.
Every day before noon the Pentagon was spending $550 million. One B-2 bomber cost the US taxpayer $2 billion, enough money to build 400 new schools. The price of one F-18 would hire 1,000 new teachers. The Saudis purchased over $13 billion in weapons before the Gulf War. Now the US pressured the House of Saud and other GCC monarchs to buy more weaponry. [511] The first post-Gulf War GCC contracts went to GE and Hughes Aircraft, a GM subsidiary.
The Four Horsemen have always made exorbitant profits in times of crisis. The myth of scarcity is their friend, so by the 3rd quarter of 1990, with the threat of war looming, profits for Big Oil began to surge. Spot crude prices shot up in August, but settled back by October. Pump prices stayed high throughout the war. By 4th quarter 1990, 19 of the top 20 oil companies showed a combined average profit increase over 4th quarter 1989 of 281%.
The top five US oil companies reported collective profits of $4.8 billion for the quarter. Chevron Texaco, which supplied much of the fuel needed by US and allied forces during Operation Desert Storm, showed a profit increase of 651% for the quarter. [512] Board member George Pratt Schultz must have been pleased. In the first quarter of 1991, with the war in full swing, Exxon Mobil netted $2.4 billion, its biggest single quarterly profit since John D. Rockefeller founded Standard Oil of NJ in 1882. The world’s eleven largest oil companies saw their profits increase 157% from 1989-1991. Ten of the top twenty-three oil companies established new peak asset levels.
The war helped the Four Horsemen further diminish the power of independent challengers. Sun Oil, American Petrofina, ARCO, Coastal, Unocal, Marathon and Pennzoil saw profits decline during the war. [513]
The Gulf War pulled the US out of a deep recession. There had been much talk of waning US economic might. Japan was seen emerging as world economic superpower, with the Asian Tiger economies playing a supporting role. The US held competitive advantage in only three industries: oil, defense and engineering. Each US economic engine was revved to mach speed by the Gulf War and the reconstruction of Kuwait that followed.
Balancing the Books
The record profits accrued by US corporations as a result of the Gulf War also served to offset the imbalance in US/GCC trade created by GCC oil revenue.
The oil monarchs were suddenly buying billions in US weaponry and paying US engineering firms to expand oil and gas facilities, allowing for higher oil production and lower oil prices that served as jet fuel for a sluggish US economy. The rebuilding of Kuwait was another shot in the US economic arm. The Bush Administration solicited financial contributions for the war effort which ended up exceeding the cost of the war. The US Treasury made money off the war. This profiteering didn’t go unnoticed. Germany and Japan both requested refunds for their contributions. [514]
Saudi Arabia and Kuwait bore the brunt of the financial burden of the Gulf War, just as they were taking it on the chin for Saddam’s bills unpaid from the Iran/Iraq War. Did the US seek to diminish the wealth of these two most powerful GCC nations as a means to keep them dependent on US security schemes? Big Oil never liked the moves into downstream oil investments which both the Saudis and Kuwaitis had started making. Kuwait had been so successful there was industry talk of it becoming “the 8th Sister”.
Even before the US bombed Iraq, the tab the GCC was running for US intervention outstripped oil revenues. In Riyadh war expenses exceeded oil revenues by a whopping $10 billion dollars. Despite ARAMCO’s expansion, the Saudis had to import jet fuel for allied planes, underscoring the lack of refining facilities in the country even after the Ras Tanura upgrade. [515]
The House of Saud spent $13.5 billion for basic upkeep of US troops based there to execute the Gulf War, $3-4 billion to provide for 200,000 Kuwaiti refugees and provided the brunt of the $9.5 billion in GCC aid which the US pushed for to reward countries like Syria, Egypt and Senegal for their support in the war effort. But this was chicken scratch compared to the billions that ended up in the pockets of US defense and engineering firms. Prince Abdullah Faisal bin Turki, chair of the Saudi Industrial Development Authority, estimated the total war cost to the Saudis at over $80 billion. [516]
There were economic losses to GCC less easily calculated. The day Iraq invaded Kuwait, confidence in Persian Gulf investments was shattered. Bahrain, offshore banking center to the region, lost $13.7 billion in bank deposits. The UAE saw bank withdrawals rise to 25% of liabilities. The Saudi Arabian stock market crashed and 11% of all bank deposits left the Kingdom. Major industrial projects were canceled, including a Saudi plan to build another $6 billion petrochemical complex at Jubail Industrial City.
Saudi International Bank, whose executive director was Morgan Guaranty’s Peter de Roos, bought millions of dollars in discounted South American debt to bail out the international bankers under Bush Treasury Secretary and Dillon Read alumnus Nicholas Brady’s “Brady Plan”. [517]
The Saudi Arabian Monetary Agency (SAMA), the Kingdom’s Morgan-led central bank, showed a $9 billion account deficit in 1989 due to falling oil prices caused by ARAMCO and Four Horsemen expansions. Now even the Saudi swing producer extraordinaire was suffering the consequences of low oil prices. In a moment of remarkable irony SAMA was forced to borrow $3.5 billion to cover a reserve shortfall from an international banking syndicate led by JP Morgan Chase. [518]
Kuwait was faring no better. It went from being an international creditor to a debtor nation because of the Gulf War. Downstream oil investments were shelved. The al-Sabah family slush fund was forced to sell $10-15 billion in overseas assets and borrow an additional $20 billion from the international bankers over the next five years to pay for reconstruction of the decimated emirate. Some Kuwaiti assets were mysteriously “lost” and never recovered. The rebuilding of Kuwait cost over $100 billion.
The Kuwait-Maryland Partnership was formed before the war to plan the rebuilding of Kuwait. The US Army Corps landed an initial 90-day contract to clean up the war mess for $45 million. [519] Time magazine reported that Waste Management went into Kuwait without even asking permission and began cleaning up, then presented the Kuwaitis with a $500,000 bill. It then got a $12 million contract to continue picking up war trash. The World Bank advised Kuwait in its recovery effort. Bechtel led the contractor frenzy, with a cadre of subcontractors led by Brown & Root and Dresser Industries, two subsidiaries of Houston-based Halliburton.
Tough-talking Bush Sr. Secretary of Defense Dick Cheney was now Halliburton Chairman and CEO. Cheney now struck a more business-like tone, cutting oil deals with Saddam Hussein. According to the Financial Times, from 1998-2000 Halliburton did nearly $24 million in business selling oil drilling equipment and services to Iraq. Cheney & Company circumvented the US embargo by dealing through two European subsidiaries, Dresser Rand and Ingersoll-Dresser Pump. [520]
Raytheon installed a new air traffic control system in Kuwait, while AT&T and Motorola received mobile phone contracts. When the Kuwaitis announced they would purchase fifteen new Airbus jetliners from Europe for $200 million, Bush Commerce Secretary and Texas Commerce Bank insider Robert Mosbacher fired off an angry letter to the al-Sabah clan. Kuwait decided to purchase three Boeing 747’s for $500 million instead. According to World Bank officials 80% of Kuwaiti rebuilding contracts went to US companies. US exports to Kuwait in 1991 more than doubled to $2 billion.
Neil Bush, the President’s Silverado S&L looting son, lobbied the al-Sabah clan on behalf of two Houston-based oil equipment companies. Marvin Bush, another Bush progeny, lobbied for contracts for Murphy & Associates, a firm owned by former US Ambassador to Saudi Arabia Richard Murphy. Former Reagan Press Secretary John Sununu helped Westinghouse procure a contract to build a $1 billion perimeter defense system for Kuwait, while Bush Secretary of State James Baker was hired straight out of office as a lobbyist for now-defunct Enron, which received a $600 million contract from Kuwait to build an electrical power plant. [521]
The Big Three US automakers fared well, since 300,000 cars were destroyed in the war. It took nearly a decade to restore Kuwait’s oil industry. Bechtel led this massive project receiving an initial $1 billion contract to put out the raging fires at 650 oil wells. In 1996 Kuwait announced that it would spend another $25 billion on its seemingly endless rebuilding effort. Other GCC nations rewarded Bechtel too. In 1994 it got a $450 million contract to upgrade the refinery it built at Ras Tanura, Saudi Arabia. A month later it was given the contract to upgrade another Saudi refinery. That same year it contracted with UAE-based Abu Dhabi Company to build oil infrastructure.
In 1993 Bechtel built a fertilizer plant in Syria, an oil pipeline in Algeria, oilfield infrastructure for Chevron Texaco in Kazakhstan and the Miami International Airport. In 1995 Bechtel led a USAID funded consortium to restructure the energy sectors in eleven Central and Eastern European nations and joined forces with Daewoo in a major Israeli industrial development.
Saudi billionaire Sulaiman Olayan, who rode the Bechtel escalator to riches, told a meeting of international bankers in New York in 1993 that total losses to the GCC states due to the Gulf War were over $620 billion.
Dean Henderson is the author of five books: Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network, The Grateful Unrich: Revolution in 50 Countries,Das Kartell der Federal Reserve, Stickin’ it to the Matrix & The Federal Reserve Cartel. You can subscribe free to his weekly Left Hook column @www.hendersonlefthook.wordpress.com
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