For Hans Christof von Sponeck, the former assistant secretary-general of the UN, the United Nations, far from garding the respect for international law and the consolidation of peace, have themselves become a factor of injustice. Thus, the sanctions imposed on Saddam Hussein's Iraq caused a human disaster, whereas treaties such as the nuclear non-proliferation treaty are used to ensure the domination of certain powers and to threaten others. It is time to change the system completely.

23 March 2007

Hans-Christof von Sponeck Count Hans-Christof von Sponeck, born in Bremen in 1939, has been working for the United Nations Development Programme (UNDP) for 32 years. Appointed by Kofi Annan in 1998 as United Nations Humanitarian Coordinator for Iraq, with the status of UN Assistant to the Secretary General, Mr. von Sponeck resigned in March 2000 in protest against the sanctions, which had led the Iraqi people to misery and starvation. It is with sorrow and bitterness that he speaks about the sufferings endured by the Iraqis, a people he knew well and learned to love, and he appeals to the political leaders responsible for the catastrophe in a moving interview he gave to Silvia Cattori.

Silvia Cattori: In your book "A Different War: The UN Sanctions Regime in Iraq", [1] you denounced openly the fact that the Security Council betrayed the principles of the UN Charter. Could you give us specific examples where the UN Secretariat behaved in an especially condemnable way?

Hans von Sponeck: The Security Council must follow the UN Charter and it must not forget the Convention on the rights of the child and the general implications of these conventions. Moreover, if the Security Council knows that conditions in Iraq are inhuman - people of all ages have been in deep trouble, not because of a dictator, but because of the policies around the 'oil for food programme' - and it decides not to act, or not to do enough to protect the people against the impact of its policy, then one can argue very easily that the Security Council is to be blamed, for the very strong increase in the mortality rates in Iraq. A definite example is that during the 1980s, under the government of Saddam Hussein, UNICEF identified 25 children per thousand under the age five years of age that were dying in Iraq for various reasons. During the years of sanctions, from 1990 to 2003, there was a sharp increase from 56 per thousand children under five years of age in the early 1990s to 131 per thousand under five years of age at the beginning of the new century. Now everyone can easily understand that this was due to the economic sanctions, so it is out of the question that the Security Council preferred to ignore the consequences of its policies in Iraq under the pressure excercised by the major intervening parties including, and in particular, the United States and Great Britain.

Silvia Cattori: How could the Security Council neglect to consider the fact that these sanctions allowed the superpowers to misuse their position and uniquely pursue their war objectives, when it voted for other resolutions, like for example resolution 1559 which was particularly intended to provide the United States and Israel with a cover for future military strikes? Does that mean that the Security Council and the UN Secretariat, supposed to defend the people, have become mainly responsible for humanitarian catastrophes?

Hans von Sponeck: I would say, only those who either are ignorant, or those who cannot accept the defeat, will continue to argue that the humanitarian drama in Iraq was largely not due – not exclusively but to a large extent –to an erroneous policy, a policy of punishment. The Iraqi people were punished for having accepted the government in Baghdad, even though they were completely innocent.

Silvia Cattori: Our political leaders, who are present in all international bodies, knew perfectly well that these sanctions would have disastrous consequences. Does that mean that, by remaining silent, they have accepted innocent civilians to be killed, tortured, and starved?

Hans von Sponeck: I would say, unless the international community has a very bad memory, we cannot forget that, either there was silence or there was connivance, support, or there was a deliberate effort to promote conditions of the kind that prevailed in Iraq during thirteen years of sanctions. Therefore, you get different levels of accountability, of political accountability. Not only the Prime Minister of Great Britain and the President of the United States and their governments are responsible, but others as well; Spain and Italy played a supportive role that means the former governments are responsible as well. Mr Aznar in Madrid and Mr Berlusconi in Italy are very much responsible for having contributed to the humanitarian disaster that evolved in Iraq. They will not accept this responsibility but the evidence is there.

Silvia Cattori: If the manipulation of the Security Council by the United States is the main problem and if the US continues to commit crimes pretending that they have a UN mandate, what can be done to correct that unacceptable situation?

Hans von Sponeck: I think that this is a very important question. It is relevant for the debate about what kind of United Nations we need to protect the international community or to protect the 192 member governments from the danger that certain other governments misuse their authority, their information, their finances and their power to serve their own interest, but against the interests of peace, the interests of justice and the interests of mankind.

Silvia Cattori: How did you react to the execution of Saddam Hussein and his co-defendants, sentenced to death by a tribunal established by the USA?

Hans von Sponeck: I would say, first of all, that I was not surprised. This was the ultimate objective of those in power in Baghdad and of those who occupy Iraq. It is impossible to defend Saddam Hussein, but we can respond to the fact that there was no due process, but a masquerade. It was a tribunal that hid a prearranged death sentence under the cover of respectability. Saddam Hussein, like any other person, deserved the right to a fair trial, but he was not given a fair trial. And therefore I was upset by this obvious act, although we have international law, despite the fact that the European nations, the US and Canada as well as other western nations repeatedly express their intention to maintain justice, that they in fact did not protect justice.

Silvia Cattori: You wrote to President Bush and asked him to free Tarek Aziz. Did you get an answer?

Hans von Sponeck: I did not get an answer. I wrote this letter because I know Mr Tarek Aziz. My predecessor and I both think he is a person with whom we had a correct relationship, a person who – despite what we read in the mainstream media – tried to look to the Iraqi people. He was ready and willing to consider proposals for the improvement of the humanitarian aid programme. From our perspective, from my perspective, he was a correct person. I cannot judge what Mr Tarek Aziz did in Iraq outside my fields of responsibility, but all I want to ask for is that a person, who is ill, if for no other than humanitarian reasons, should be treated with dignity, should be allowed to obtain medical care while having a fair trial. Just like Saddam Hussein, Tarek Aziz deserved, and deserves, to be treated in accordance with international law, in accordance with The Hague and the Geneva Conventions. I object to the fact that over three years after he voluntarily turned himself in to the occupation forces, he has not even been charged, and still remains in custody while he is badly in need of medical care.

Silvia Cattori: While the situation created by the occupation of Iraq is frightening, it is to be feared that the Resolution against Iran will be used by the United States to strike that country. The German Navy – formally under UN mandate – is in place in the Eastern Mediterranean. Is it because you know to what extent your country is involved in the projects of war of the United States that you recently wrote an open letter to Mrs Angela Merkel asking her to refuse all use of violence against Iran?

Hans von Sponeck: That is correct. I feel very strongly that, gradually, Germany and other European countries are getting involved into power policy defined in Washington by power-hungry people. This is becoming more serious because these power-hungry people begin to realize that they cannot, on their own, implement a policy of domination. So they need the help of other governments now, and these others seem to be Central-European and Eastern European governments from Lithuania to Great Britain. They also try to politicise NATO and make it an instrument, which to a large extent has in fact already become a US instrument. Therefore, just like any normal individual in this world, I cannot accept the attempts – supported by Chancellor Merkel during the recent NATO summit – to provide this military alliance with a political mission. NATO is an instrument of the Cold War; for many years NATO was looking for a new mission, for a new role. The only thing the allies knew was that they have a military responsibility but, with the end of the Cold War in Europe, that responsibility no longer existed and was no longer necessary. So there was this desperate search for a new role.

I personally think that it is extremely dangerous that NATO now presents itself as a democratic instrument for western democracies while, in fact, it is a tool in the hands of the United States to implement the Project for the 'New American Century'. Neoconservatives in the United States made this famous proposal in the 1990s – while the Bush administration converted it into its national security strategy of 2002 and subsequent years - and NATO is supposed to assist its implementation. The responsible politicians that recently met in Munich should have rejected this concept. Mr Vladimir Putin, the Russian President for once did not mince his words and expressed plainly what many of us feel. Of course, those who follow a different agenda rejected his suggestions. However, there is a reality in what Mr Putin said.

I am convinced that, due to this militarised politicisation of NATO, we will have taken a big step backwards to what is not only a Cold War atmosphere between major powers, but also, and this is the tragedy, to an increase in defence spending in many countries including China, Russia, and Western Europe. This spending has already been greatly increased in numerous countries, and it can serve no other purpose than escalating the polarisation between different groups around the world. The world beyond Central Europe and North America is no longer willing to accept a western one-sided policy. The public no longer accepts the requirements of last century's military and economic powers. Their days are over and, if we do not take this into account, we will only make things worse. To me, the key words at the moment are dialogue and diplomacy. We have to accomplish this in a clearly multilateral spirit, not in the spirit of a superpower, which is anything but a superpower be it economically, politically or morally, let alone ethically. Even if there is a little bit of superpower spirit left in the United States because of its military power, it is not going to be enough to save the 'Pax Americana'. 'Pax Americana' is a thing of the past and the sooner we recognise this in Europe and prepare ourselves for multilateral cooperation – which is something different from the bilateral or NATO type cooperation – the better it will be.

Silvia Cattori: NATO is taking part in wars of occupation – in contradiction to its own Charter – and, in collaboration with the CIA, it is involved in secret criminal operations: What I think of in this context are the abductions of suspects to secret prisons. If Europe continues to submit itself to and accepts the installation of American anti-missile systems in NATO member states, might this not lead to confrontation, or even to the return to the worst days of Cold War?

Hans von Sponeck: It is insane. There is no excuse, and Condoleezza Rice's argument according to which Russia had no reason to worry about ten anti-missile systems to be stationed in Poland and in the Czech Republic is so dishonest. If ten can be placed today, twenty might be placed tomorrow. The very fact that these antimissile systems are positioned at the border of the former USSR, or Russia, is already enough to augment the reasons for confrontation between Russia and the West, let alone China.

We are creating and we are shaping tomorrow's enemy. I, and with me many others around the globe, cannot accept this development. We do not count, however, we are weak, we are considered naïve, we are considered 'blue-eyed people', as the Americans have often called us, who do not understand the 'global vision'.

Well, if we are living in a democracy, then I have the right to understand this 'global vision', but I am not informed about it. I am just asked to rely on the good will and on the good intentions of a government like the one in Washington. But I cannot do so, we cannot do so, because we have been disappointed over and over again by misinformation, by brutal dishonesty, by power politics that only served one party. I am far from accepting this and, therefore I regard the whole policy of convincing the Czech and Polish governments to have these antimissile systems as extremely dangerous and misplaced. That is nothing but blatant and brutal power politics, which we do not need and which we will fight against. Peace, future internationalism and the consolidation of nations and progress – in the spirit of the UN Charter and other international laws – don't have any need of that.

Silvia Cattori: You were in Kuala Lumpur in February, to attend a conference on war crimes. There was, in the West, very limited media coverage on this important event. If such meetings, which denounce the drifts of NATO and the violations of the UN Charter, are ignored, how can a debate be opened for reforming these organisations? Don't you feel like speaking in a desert while the media, the UN, the States, go on lying and ignore your struggle?

Hans von Sponeck: Well, you know, one should not be discouraged by the fact that the media ignore us. Most of the time, when citizens tried to convince their leaders to change direction, they have been ignored. Well, should that be the end of the effort? I do not think so. The very fact that people, not just fools, not just misguided dreamers, but very realistic people who have an overall view on the world, who understand the political processes, come together to debate in a serious way the conditions and misuse of power, gives important evidence that the international conscience is alive, that an international conscience exists. Kuala Lumpur did not make it to the headlines; Hollywood makes it to the headlines, cheap emotionalism, and cheap quality media events like the Big Brother programme in London make headlines.

The fact that 5000 people got together in Kuala Lumpur to discuss war as a crime, against the background of all the global sufferings that these illegal wars have caused, did not make it to the headlines is regrettable, but it should not make people less willing to speak out. Those attacted by these crimes should notice it. Every one of us, as an individual, has a responsibility to observe, has to make his or her views known. In addition, I am sure that the Kuala Lumpur meeting has created more awareness in many circles around the world, which will ultimately be transferred into a greater resistance against these feint and selfish and one-sided policies that the West tries to enforce.

I am not anti-West, I am a 'Westerner' but that does not mean that I cannot critically look at the one-way street which has developed, the one-way traffic on which international power, international trade, international culture are travelling. That, as I have said before, cannot continue because it is no longer acceptable, and Kuala Lumpur brought together people from all over the world, who are of the same opinion. So this has, I am sure, added to an awareness, and a willingness to invest time in order to make views known. And if that does not hit the headlines today and bring about a change immediately, it may do so tomorrow, and if it is not tomorrow, then the next day.

Silvia Cattori: Voices who, like Mr Jimmy Carter's and Mr John Dugard's denounce the crimes of Israel in Palestine, voices who, like Mr Dennis Halliday's [2] and your own voice put the finger on UN's drifting off course in Iraq, all these voices are demanding for an immense respect. However, these are rare voices, which can be easily marginalised by the political powers. Aren't you disappointed that hardly anybody or only a few people at your level follow your example and take position against these state crimes and abuses?

Hans von Sponeck: Of course, I am disappointed. You know, these days, every day, I am waiting anxiously for a senior American general, a senior American political personality to come out and say: enough is enough, I will not continue to support insanity, I will not go on supporting illegality, I will no longer support policies that have led us into deep difficulties and deep violations of anything that a civilised person should stand for. Of course, one is disappointed, but in view of what has happened during the last few decades, particularly during the years when Mr Bush has been in power, we cannot allow ourselves to be idle. This is an appeal for the international peace movement which should be oriented towards a better coordination, i.e. much better networking, much more combined effort, much more joint declarations. People from all over the world should join hands and demonstrate to themselves and to the larger public that they have the firm intention not to accept what has led us into a world in which the gulf is wide open between those who have nothing – and that is a very, very large majority, over one billion people out of the six and a half billion people on our planet living with less than one dollar a day – and the top ten percent who are living in unimaginable luxury and well being.

This cannot continue. And if some people who listen to our conversation may say 'here is really a very naïve person', and others say 'look this is a communist, terrible, he is asking for equality for everybody', I will tell them 'no, I am not'. First of all I do not think I am naïve, secondly, I do not think I am a communist in the traditional sense. I am a person who, in 32 years of work for the United Nations and beyond, has learned to accept the fact that all of us are not equal, but that all of us should have equal opportunities to develop our own contribution to peace. It is not a question of lack of money, there is plenty of money for everybody but, what is missing is the will to share the resources and to do more than pay lip service to this wonderful body of instruments that has been established by good people after the Second World War. Over the last sixty years, this body has tried to lay the basis for greater justice and for socioeconomic progress for everybody.

Silvia Cattori: All the hope that you feed must make you suffer, as you are well aware that for the Muslim peoples that the West is humiliating, the worst is still to come?

Hans von Sponeck: Of course. If you read and if you see, what is happening in the Middle East, there is no single day on which you do not feel ashamed, you do not feel the humilitation that strikes us when we see these poor people suffering hard, people from Palestine to Iraq and in other parts of the Middle East as well. The human language is not, at least for me, capable of expressing the feelings that I really have. It is horrifying. I come from a country, which experienced and caused this horrible Second World War. It lasted for five years, and we still talk about it. What about the many years in Iraq, thirty years of dictatorship, and thirteen years of sanctions, and now three and a half years of occupation: how much can an individual, how much can a nation endure? And if you see – I think of the universities I visited was in Baghdad, Mustanseriya University, Baghdad College, Baghdad University – that these institutions where young innocent people are supposed to prepare for life, were destroyed by bombs. When I was in Iraq, I saw people living peacefully in integrated neighbourhoods! I never heard a conversation like "I am a Shiite, you are a Sunnite, and you are a Turcoman" at that time.

Baghdad is the largest Kurdish city of the world with over one million Kurds, and there were many problems, for sure, there was a dictator, there were political murderers but, compared with what we see today, that was nothing. The sectarian confrontation that exists now was created by this illegal war. And the threat towards the Al-Maliki government is the limit of dishonesty: "If you do not bring security to Iraq, then we, the Americans, will reconsider to what extend we will continue our support". What is this? Who established these kinds of conditions? Who is responsible for this chaos and the sectarian confrontation?

Silvia Cattori: Western countries condemn Iran that has signed the Nuclear Non-Proliferation Treaty, for a bomb that it does not have. They do not condemn Israel that did not sign this treaty, and that has nuclear bombs. Choosing between Israel that does not conceal preparing for waging a pre-emptive nuclear war, and Iran who wants to have a civil nuclear industry, is not Israel the one that is really threatening world peace, and is not Iran the target? How do you react to this denial of justice?

Hans von Sponeck: I have only one immediate response: it is a classical example of a double standard. We have a demand for a nuclear free zone: It is the Security Council's resolution 687 of April 1991 which in paragraph 14, calls for a nuclear free zone for the complete Middle East. Israel has not even signed the Non-Proliferation Treaty. Iran may have intentions that are against the long-term international interests, but Iran has not yet passed the red line. Mister El-Baradei, the director of the International Atomic Agency did not say that Iran had passed that line. All he did was to say that Iran has not fully disclosed, not transparently enough, its intentions and that Iran has put more centrifuges into operation.

But what an extraordinary demonstration of double standards, not to point the finger at Israel and others! What about Pakistan, what about India? And about the US itself which is openly working on a new generation of nuclear weapons, totally in violation of the Non-Proliferation Treaty of which the US is an initiator. So this is a disastrous double standard. If I were an Iranian, I would say: 'Sorry, take yourself measures to put into practice of what you say is the norm and then we can talk, let's sit down at the table, at the same eye level, with no preconditions.'

I accept the Iranian demand for dialogue. I think it is absolutely the right thing to do. Iran says: 'You have a disagreement, so let's meet, but do not come and tell me before I can meet you, that I must have fulfilled certain conditions that you want me to fulfil; I am sorry, we come, we meet, we talk, and we lay the cards on the table. And what we discover when we look at reality is a frightening attempt to keep up a double standard.

Silvia Cattori: What message would you like to give to those political leaders who do not care about human rights who wage wars and violating international and human rights? What message would you like to give to the populations who are, at present, exposed to the terror of occupying states? And what message would you like to give to those who oppose these wars but do not know how to stop them and are grieving over the inaction of the political parties?

Hans von Sponeck: To those who are violating human rights, I would say: You must live with your own guilty conscience, and how can you, in the light of all the evident damage, live with your guilty conscience? Don't you think that there are better ways to protect your interests by at the same time allowing others to benefit from existing opportunities?

To those who are victims and those who are concerned, I would say: Never give up, just try your best, we all live in freedom, as healthy individuals, to make our contribution small as they may be. If we gather for that aim, if we cooperate, if we network, if we try to make our views known to those in power, we can make a contribution. We can use our votes –those of us who live in countries with free elections – let us make use of our votes but not in a mechanical way. For it is a great act of responsibility to cast a vote. Know your political candidates, put pressure on them, hold them accountable, check their records and, when there is a re-election, if you are not satisfied, encourage those who deserve your confidence to run for office. What else can we do?

Even as the world's billionaires grew in number from 793 in 2006 to 946 this year, major mass uprisings became commonplace in China and India. In India, which has the highest number of billionaires (36) in Asia with total wealth of $191 billion, Prime Minister Singh declared that the greatest single threat to 'India's security' were the Maoist-led guerrilla armies and mass movements in the poorest parts of the country. In China, with 20 billionaires with $29.4 billion net worth, the new rulers, confronting nearly a hundred thousand reported riots and protests, have increased the number of armed special anti-riot militia a hundred fold, and increased spending for the rural poor by $10 billion in the hopes of lessening the monstrous class inequalities and heading off a mass upheaval.

The total wealth of this global ruling class grew 35 per cent year to year topping $3.5 trillion, while income levels for the lower 55 per cent of the world's 6-billion-strong population declined or stagnated. Put another way, one hundred millionth of the world's population (1/100,000,000) owns more than over 3 billion people. Over half of the current billionaires (523) came from just 3 countries: the US (415), Germany (55) and Russia (53). The 35 per cent increase in wealth mostly came from speculation on equity markets, real estate and commodity trading, rather than from technical innovations, investments in job-creating industries or social services.

Among the newest, youngest and fastest-growing group of billionaires, the Russian oligarchy stands out for its most rapacious beginnings. Over two-thirds (67 per cent) of the current Russian billionaire oligarchs began their concentration of wealth in their mid to early twenties. During the infamous decade of the 1990's under the quasi-dictatorial rule of Boris Yeltsin and his US-directed economic advisers, Anatoly Chubais and Yegor Gaidar the entire Russian economy was put up for sale for a 'political price', which was far below its real value. Without exception, the transfers of property were achieved through gangster tactics ­ assassinations, massive theft, and seizure of state resources, illicit stock manipulation and buyouts. The future billionaires stripped the Russian state of over a trillion dollars worth of factories, transport, oil, gas, iron, coal and other formerly state-owned resources.

Contrary to European and US publicists on the right and left, very few of the top former Communist leaders are found among the current Russian billionaire oligarchy. Secondly, contrary to the spin-masters' claims of 'communist inefficiencies', the former Soviet Union developed mines, factories, energy enterprises were profitable and competitive, before they were taken over by the new oligarchs. This is evident in the massive private wealth that was accumulated in less than a decade by these gangster-businessmen.

Virtually all the billionaires' initial sources of wealth had nothing to do with building, innovating or developing new efficient enterprises. Wealth was not transferred to high Communist Party Commissars (lateral transfers) but was seized by armed private mafias run by recent university graduates who quickly capitalized on corrupting, intimidating or assassinating senior officials in the state and benefiting from Boris Yeltsin's mindless contracting of 'free market' Western consultants.

Forbes magazine puts out a yearly list of the richest individuals and families in the world. What is most amusing about the famous Forbes magazine's background biographical notes on the Russian oligarchs is the constant reference to their source of wealth as 'self-made' as if stealing state property created by and defended for over 70 years by the sweat and blood of the Russian people was the result of the entrepreneurial skills of thugs in their twenties. Of the top eight Russian billionaire oligarchs, all got their start from strong-arming their rivals, setting up 'paper banks' and taking over aluminum, oil, gas, nickel and steel production and the export of bauxite, iron and other minerals. Every sector of the former Communist economy was pillaged by the new billionaires: Construction, telecommunications, chemicals, real estate, agriculture, vodka, foods, land, media, automobiles, airlines etc..

With rare exceptions, following the Yeltsin privatizations all of the oligarchs quickly rose to the top or near the top, literally murdering or intimidating any opponents within the former Soviet apparatus and competitors from rival predator gangs.

The key 'policy' measures, which facilitated the initial pillage and takeovers by the future billionaires, were the vast and immediate privatizations of almost all public enterprises by the Gaidar/Chubais team. This 'Shock Treatment' was encouraged by a Harvard team of economic advisers and especially by US President Clinton in order to make the capitalist transformation irreversible. Privatization led to the capitalist gang wars and the disarticulation of the Russian economy. As a result there was an 80 per cent decline in living standards, a devaluation of the Ruble and the sell-off of invaluable oil, gas and other strategic resources at bargain prices to the rising class of predator billionaires and US-European oil and gas multinational corporations. Over a hundred billion dollars a year was laundered by the mafia oligarchs in the principle banks of New York, London, Switzerland, Israel and elsewhere ­ funds which would later be recycled in the purchase of expensive real estate in the US, England, Spain, France as well as investments in British football teams, Israeli banks and joint ventures in minerals.

The winners of the gang wars during the Yeltsin reign followed up by expanding operations to a variety of new economic sectors, investments in the expansion of existing facilities (especially in real estate, extractive and consumer industries) and overseas. Under President Putin, the gangster-oligarchs consolidated and expanded ­ from multi-millionaires to billionaires, to multi-billionaires and growing. From young swaggering thugs and local swindlers, they became the 'respectable' partners of American and European multinational corporations, according to their Western PR agents. The new Russian oligarchs had 'arrived' on the world financial scene, according to the financial press.

Yet as President Putin recently pointed out, the new billionaires have failed to invest, innovate and create competitive enterprises, despite optimal conditions. Outside of raw material exports, benefiting from high international prices, few of the oligarch-owned manufacturers are earning foreign exchange, because few can compete in international markets. The reason is that the oligarchs have 'diversified' into stock speculation (Suleiman Kerimov $14.4 billion ), (Mikhail Prokhorov $13.5 billion ), banking (Fridman $12.6 billion ) and buyouts of mines and mineral processing plants.

The Western media have focused on the falling out between a handful of Yeltsin-era oligarchs and President Vladimir Putin and the increase in wealth of a number of Putin-era billionaires. However, the biographical evidence demonstrates that there is no rupture between the rise of the billionaires under Yeltsin and their consolidation and expansion under Putin. The decline in mutual murder and the shift to state-regulated competition is as much a product of the consolidation of the great fortunes as it is the 'new rules of the game' imposed by President Putin. In the mid 19th century, Honoré Balzac, surveying the rise of the respectable bourgeois in France, pointed out their dubious origins: "Behind every great fortune is a great crime." The swindles begetting the decades-long ascent of the 19th century French bourgeoisie pale in comparison to the massive pillage and bloodletting that created Russia's 21st century billionaires.

Latin America

If blood and guns were the instruments for the rise of the Russian billionaire oligarchs, in other regions the Market, or better still, the US-IMF-World Bank orchestrated Washington Consensus was the driving force behind the rise of the Latin American billionaires. The two countries with the greatest concentration of wealth and the greatest number of billionaires in Latin America are Mexico and Brazil (77 per cent), which are the two countries, which privatized the most lucrative, efficient and largest public monopolies. Of the total $157.2 billion owned by the 38 Latin American billionaires, 30 are Brazilians or Mexicans with $120.3 billion . The wealth of 38 families and individuals exceeds that of 250 million Latin Americans; 0.000001 per cent of the population exceeds that of the lowest 50 per cent. In Mexico, the income of 0.000001 per cent of the population exceeds the combined income of 40 million Mexicans. The rise of Latin American billionaires coincides with the real fall in minimum wages, public expenditures in social services, labor legislation and a rise in state repression, weakening labor and peasant organization and collective bargaining. The implementation of regressive taxes burdening the workers and peasants and tax exemptions and subsidies for the agro-mineral exporters contributed to the making of the billionaires. The result has been downward mobility for public employees and workers, the displacement of urban labor into the informal sector, the massive bankruptcy of small farmers, peasants and rural labor and the out-migration from the countryside to the urban slums and emigration abroad.

The principal cause of poverty in Latin American is the very conditions that facilitate the growth of billionaires. In the case of Mexico, the privatization of the telecommunication sector at rock bottom prices, resulted in the quadrupling of wealth for Carlos Slim Helu, the third richest man in the world (just behind Bill Gates and Warren Buffet) with a net worth of $49 billion . Two fellow Mexican billionaires, Alfredo Harp Helu and Roberto Hernandez Ramirez benefited from the privatization of banks and their subsequent de-nationalization, selling Banamex to Citicorp.

Privatization, financial de-regulation and de-nationalization were the key operating principles of US foreign economic policies implemented in Latin America by the IMF and the World Bank. These principles dictated the fundamental conditions shaping any loans or debt re-negotiations in Latin America.

The billionaires-in-the-making, came from old and new money. Some began to raise their fortunes by securing government contracts during the earlier state-led development model (1930's to 1970's) and others through inherited wealth. Half of Mexican billionaires inherited their original multi-million dollar fortunes on their way up to the top. The other half benefited from political ties and the subsequent big payola from buying public enterprises cheap and then selling them off to US multi-nationals at great profit. The great bulk of the 12 million Mexican immigrants who crossed the border into the US have fled from the onerous conditions, which allowed Mexico's traditional and nouveaux riche millionaires to join the global billionaires' club.

Brazil has the largest number of billionaires (20) of any country in Latin America with a net worth of $46.2 billion , which is greater than the new worth of 80 million urban and rural impoverished Brazilians. Approximately 40 per cent of Brazilian billionaires started with great fortunes ­ and simply added on ­ through acquisitions and mergers. The so-called 'self-made' billionaires benefited from the privatization of the lucrative financial sector (the Safra family with $8.9 billion ) and the iron and steel complexes.

How to Become a Billionaire

While some knowledge, technical and 'entrepreneurial skills' and market savvy played a small role in the making of the billionaires in Russia and Latin America, far more important was the interface of politics and economics at every stage of wealth accumulation.

In most cases there were three stages:

1. During the early 'statist' model of development, the current billionaires successfully 'lobbied' and bribed officials for government contracts, tax exemptions, subsidies and protection from foreign competitors. State handouts were the beachhead or take-off point to billionaire status during the subsequent neo-liberal phase.

2. The neo-liberal period provided the greatest opportunity for seizing lucrative public assets far below their market value and earning capacity. The privatization, although described as 'market transactions', were in reality political sales in four senses: in price, in selection of buyers, in kickbacks to the sellers and in furthering an ideological agenda. Wealth accumulation resulted from the sell-off of banks, minerals, energy resources, telecommunications, power plants and transport and the assumption by the state of private debt. This was the take-off phase from millionaire toward billionaire status. This was consummated in Latin America via corruption and in Russia via assassination and gang warfare.

3. During the third phase (the present) the billionaires have consolidated and expanded their empires through mergers, acquisitions, further privatizations and overseas expansion. Private monopolies of mobile phones, telecoms and other 'public' utilities, plus high commodity prices have added billions to the initial concentrations. Some millionaires became billionaires by selling their recently acquired, lucrative privatized enterprises to foreign capital.

In both Latin America and Russia, the billionaires grabbed lucrative state assets under the aegis of orthodox neo-liberal regimes (Salinas-Zedillo regimes in Mexico, Collor-Cardoso in Brazil, Yeltsin in Russia) and consolidated and expanded under the rule of supposedly 'reformist' regimes (Putin in Russia, Lula in Brazil and Fox in Mexico). In the rest of Latin America (Chile, Colombia and Argentina) the making of the billionaires resulted from the bloody military coups and regimes, which destroyed the socio-political movements and started the privatization process. This process was then even more energetically promoted by the subsequent electoral regimes of the right and 'center-left'.

What is repeatedly demonstrated in both Russia and Latin America is that the key factor leading to the quantum leap in wealth ­ from millionaires to billionaires ­ was the vast privatization and subsequent de-nationalization of lucrative public enterprises.

If we add to the concentration of $157 billion in the hands of an infinitesimal fraction of the elite, the $990 billion taken out by the foreign banks in debt payments and the $1 trillion (one thousand billion) taken out by way of profits, royalties, rents and laundered money over the past decade and a half, we have an adequate framework for understanding why Latin America continues to have over two-thirds of its population with inadequate living standards and stagnant economies.

The responsibility of the US for the growth of Latin American billionaires and mass poverty is several-fold and involves a wide gamut of political institutions, business elites, and academic and media moguls. First and foremost the US backed the military dictators and neo-liberal politicians who set up the billionaire-oriented economic models. It was ex-President Clinton, the CIA and his economic advisers, in alliance with the Russian oligarchs, who provided the political intelligence and material support to put Yeltsin in power and back his destruction of the Russian Parliament (Duma) in 1993 and the rigged elections of 1996. And it was Washington, which allowed hundreds of billions of dollars to be laundered in US banks throughout the 1990's as the US Congressional Sub-Committee on Banking (1998) revealed.

It was Nixon, Kissinger and later Carter and Brzezinski, Reagan and Bush, Clinton and Albright who backed the privatizations pushed by Latin American military dictators and civilian reactionaries in the 1970's, 1980's and 1990's . Their instructions to the US representatives in the IMF and the World Bank were writ large: Privatize, de-regulate and de-nationalize (PDD) before any loans should be negotiated.

It was US academics and ideologues working hand in glove with the so-called multi-lateral agencies, as contracted economic consultants, who trained, designed and pushed the PDD agenda among their former Ivy League students-turned-economic and finance ministers and Central Bankers in Latin America and Russia.

It was US and EU multi-national corporations and banks which bought out or went into joint ventures with the emerging Latin American billionaires and who reaped the trillion dollar payouts on the debts incurred by the corrupt military and civilian regimes. The billionaires are as much a product and/or by-product of US anti-nationalist, anti-communist policies as they are a product of their own grandiose theft of public enterprises.

Conclusion

Given the enormous class and income disparities in Russia, Latin America and China (20 Chinese billionaires have a net worth of $29.4 billion in less than ten years), it is more accurate to describe these countries as 'surging billionaires' rather than 'emerging markets' because it is not the 'free market' but the political power of the billionaires that dictates policy.

Countries of 'surging billionaires' produce burgeoning poverty, submerging living standards. The making of billionaires means the unmaking of civil society ­ the weakening of social solidarity, protective social legislation, pensions, vacations, public health programs and education. While politics is central, past political labels mean nothing. Ex-Marxist Brazilian ex-President Cardoso and ex-trade union leader President Lula Da Silva privatized public enterprises and promoted policies that spawn billionaires. Ex-Communist Putin cultivates certain billionaire oligarchs and offers incentives to others to shape up and invest.

The period of greatest decline in living standards in Latin America and Russia coincide with the dismantling of the nationalist populist and communist economies. Between 1980-2004, Latin America ­ more precisely Brazil, Argentina and Mexico ­ stagnated at 0 per cent to 1 per cent per capita growth. Russia saw a 50 per cent decline in GNP between 1990-1996 and living standards dropped 80 per cent for everyone except the predators and their gangster entourages.

Recent growth (2003-2007), where it occurs, has more to do with the extraordinary rise in international prices (of energy resources, metals and agro-exports) than any positive developments from the billionaire-dominated economies. The growth of billionaires is hardly a sign of 'general prosperity' resulting from the 'free market' as the editors of Forbes Magazine claim. In fact it is the product of the illicit seizure of lucrative public resources, built up by the work and struggle of millions of workers, in Russia and China under Communism and in Latin America during populist-nationalist and democratic-socialist governments. Many billionaires have inherited wealth and used their political ties to expand and extend their empires ­ it has little to do with entrepreneurial skills.

The billionaires' and the White House's anger and hostility toward President Hugo Chavez of Venezuela is precisely because he is reversing the policies which create billionaires and mass poverty: He is re-nationalizing energy resources, public utilities and expropriating some large landed estates. Chavez is not only challenging US hegemony in Latin America but also the entire PDD edifice that built the economic empires of the billionaires in Latin America, Russia, China and elsewhere.

The primary data for this essay is drawn from Forbes Magazine 's "List of the World's Billionaires" published March 8, 2007.

James Petras most recent book is The Power of Israel in the United States.(clarity 2006 third printing) His essays in English can be found at www.petras.lahaine.org  and in Spanish at www.rebellion.org

A mysterious Congo vanishing uranium bars incident has emerged, coinciding with a decisive International Atomic Energy Agency (IAEA) Board of governors meeting in Vienna on March 5-8, regarding Iran's nuclear program. 

According to Kinshasa's Le Phare newspaper (March 7), "more than 100 bars of uranium as well as an unknown quantity of uranium contained in helmet-shaped cases, had disappeared from the nuclear centre in Kinshasa as part of a vast trafficking [operation]" Le Phare, 8 March 2007, Le Phare, 7 March 2007) 

The Democratic Republic of the Congo's Commissioner for atomic energy Professor Fortunat Lumu and his associate were arrested over allegations of uranium smuggling.  The Congo's state prosecutor, Tshimanga Mukeba said that Lumu is being "questioned regarding  the alleged disappearance of unspecified quantities of uranium in recent years."  He is accused of  "orchestrating illicit contracts to produce and sell uranium". (BBC, 8 March 2007) 

The IAEA is also said to be "investigating the situation". While the names of the alleged buyers were not revealed, the presumption within the Western media, based to an "authoritative" August 2006 Sunday Times report, which is quoted profusely in syndicated press reports, IS that Tehran might be behind the uranium smuggling operation. 

Iraq, Iran, Niger, The Congo, yellow cake, missing uranium 238 bars. 

A feeling of déjà vu. 

Remember the Niger uranium yellow cake, which was used as a pretext to wage war on Iraq. 

Ironically, on the day Professor Lumu was arrested for alleged smuggling of uranium 238 (natural uranium) in Kinshasa, back in the US, former Cheney chief of staff  I. Lewis "Scooter" Libby was being convicted by a federal grand jury on multiple counts of perjury and obstruction of justice in relation to the Niger "yellow cake" operation. 

According to US media reports, Bush's adviser Karl Rove and former Deputy Secretary of State Richard Armitage were also involved. In fact, the missing uranium bars scandal in the Congo coincided chronologically with the final days of the Scooter Libby trial.  

As confirmed in the trial proceedings, the yellow cake story was a fabrication triggered by forged documents which described Saddam Hussein as buying "yellow cake" from Niger allegedly for the production of a nuclear bomb.  Libby was acting on the orders of Vice President Dick Cheney, who is widely believed to have instigated the "yellow cake" psyop.  

Déjà Vu?

Are we dealing with a similar fabricated Psyop in the case of the alleged missing Congo uranium bars, which could at some later date be used as a pretext directed against Iran? 

Last August, at the height of Israel's criminal bombing of Lebanon during which radioactive bunker buster bombs were dropped on civilians, Britain's Sunday Times, citing an authoritative UN source dated July 18, 2005, reported that uranium 238 had been smuggled out the Lubumbashi mines in the Congo. According to Tanzanian customs officials quoted by the Sunday Times,  it was "destined for the Iranian port of Bandar Abbas".  The radioactive shipment had apparently been intercepted in Dar Es Salaam in October of 2005 "during a routine check." 

According to the Sunday Times report entitled "Iran's plot to mine uranium in Africa", "there is no doubt"  that huge quantities of uranium 238 were smuggled out of the Congo. In the same article, the Sunday Times asserts, without evidence, that Iran supported terror cells in the UK which "may be prepared to mount attacks against nuclear power plants in Britain. Intelligence circulating in Whitehall suggests that sleeper cells linked to Tehran have been conducting reconnaissance at some nuclear sites in preparation for a possible attack."

The [Tanzanian] customs officer, who spoke to The Sunday Times on condition he was not named, added: "The container [of smuggled uranium bars] was put in a secure part of the port and it was later taken away, by the Americans, I think, or at least with their help. We have all been told not to talk to anyone about this." 

The report by the UN investigation team was submitted to the chairman of the UN sanctions committee, Oswaldo de Rivero, at the end of July and will be considered soon by the security council.
...

The mine has officially been closed since 1961, before the country's independence from Belgium, but the UN investigators have told the security council that they found evidence of illegal mining still going on at the site.

In 1999 there were reports that the Congolese authorities had tried to re-open the mine with the help of North Korea. In recent years miners are said to have broken open the lids and extracted ore from the shafts, while police and local authorities turned a blind eye.

In June a parliamentary committee warned that Britain could be attacked by Iranian terrorists if tensions increased.

A source with access to current MI5 assessments said: "There is great concern about Iranian sleeper cells inside this country. [DRC] The intelligence services are taking this threat very seriously." (Sunday Times, 6 August 2006)

According to the Sunday Times: "The disclosure will heighten western fears about the extent of Iran's presumed nuclear weapons program and the strategic implications of Iran's continuing support for Hezbollah during the war with Israel."  Within the same article entitled "Iran's plot to mine uranium in Africa", all the essential "connect the dots" ingredients of Iran's rogue plot were laid out: the script included smuggled 238 uranium destined to Iran, the involvement of Iran and North Korea in the Congo's uranium economy, Iranian terrorist sleeper cells in the Congo, Iranian terrorists inside Britain, the UN sanctions committee takes note of the smuggled uranium, a British parliamentary committee warns the government of Tony Blair that an Iranian sponsored terrorist attack could take place...  

The Sunday Times alleged " Iran connection" relied on a July 18, 2005 UN Letter from the Chairman of the Security Council Committee, which it selectively misquoted and distorted. The quoted UN document and report of the Group of Experts on the DRC, while analysing the smuggling of uranium, does not even mention Iran. (United Nations Security Council, See section C of the Report of the Group of Experts, 18 July 2006, pdf) 

With regard to the report quoting Tanzanian customs officials, the shipment pertained to a relatively small amount of uranium ore (100 kg which contains about 70 grams of fissile U-235) bound for land-locked Kazakhstan via the Iranian port of Bandar Abbas:  "The shipment was destined for smelting in the former Soviet republic of Kazakhstan, delivered via Bandar Abbas, Iran's biggest port." (Sunday Times, op cit)

The UN Letter dated 18 July 2006 from the Chairman of the Security Council Committee, acknowledges incidents of smuggling over a six year period in and around Kinshasa as well as in relation to seized consignments by the Tanzanian authorities. But the UN document states that no information was provided by the Tanzanian authorities regarding the quantities involved. (United Nations Security Council, 18 July 2006, op cit. See also armscontrolwonk.com )

With regard to alleged North Korean connection, there was a delegation of engineers in 1999. But there was no follow-up due to pressure exerted on Kinshasa by Washington as confirmed in an earlier London Times report. (27 March 2004).

Brinkley Mining 

Uranium mining and exploration in the DRC (which contains significant untapped resources) is, in practice, under the control of  Western corporate capital. The underlying relationship is not with Iran but with a UK registered Anglo-South African mining company: Brinkley Mining PLC  with a subsidiary in the Seychelles. (Uranium Reserves in Africa)  The Anglo-South African conglomerate Lonrho Africa owns ten percent of Brinkley. While the principal shareholder of Brinkley is Australia's Atomaer, Brinkley is headed by Gerard Holden who is  Joint Executive Chairman of Lonrho Africa PLC. 

In 2006, the nuclear energy center headed by Professor Fortunat Lumu entered into a far-reaching agreement with Brinkley Mining. Under this agreement, Brinkley is "to develop and advise on all uranium assets in the DRC." (brinkley-mining.com)

The agreement established with the country's atomic energy authority, Le Commissariat General a l'Energie Atomique (CGEA). involved the creation of Brinkley Africa Ltd, which oversees the "domestic management of nuclear resources" in the Democratic Republic of the Congo. The exclusive rights of future uranium exploration and production were handed over to Brinkley Africa, which is a 70% owned subsidiary of Brinkley Mining, which in turn is an affiliate of Lonrho Africa. 

Brinkley Mining PLC acknowledged in a report released on the 7th of March that it "it made a loss for the year to Dec 31, 2006 of 2.747 mln stg," Brinkley stocks initially dipped momentarily on March 7th by approximately 20 percent. However, despite the financial report coupled with the announcement of the arrest of Fortunat Lumu, the price of Brinkley shares on the London Stock Exchange skyrocketed (March 8th, 50% increase in relation to its low value on 7 March, 2007). (see graph below).

Source : LSE

Meanwhile, another prominent member of the Neocon inner team, World Bank president Paul Wolfowitz arrived in Kinshasa on the 8th of March. Following a meeting with DRC President Joseph Kabila, Wolfowitz announced a 1.4 billion dollar financial support to the DRC's post-war reconstruction. While formally tagged to poverty alleviation programs, part of this World Bank money will be used to support Anglo-American and South African mining interests in the Congo. 

World Bank President Paul Wolfowitz and DRC President Joseph Kabila

Undercover Network

On Friday the 9th of March, coinciding with Paul Wolfowitz' official visit, the DRC government, without explicitly referring to the Brinkley Mines PLC,  announced that it had "dismantled an undercover network that was trying to illegally sell uranium to companies registered in Britain, South Africa and the Seychelles." (Associated Press, 9 March, emphasis added). 

Congo's Minister of Scientific Research, Sylvanus Mushi Bonane, accused Professor Fortunat Lumu and his associate of creating "fictitious companies to sell uranium" and that they had been arrested yellow-handed: 

"Bonane said, adding they were in the process of selling off the radioactive materials when they were detained...Officials declined to say if there was any connection between the arrest and the alleged 2005 shipment" which according to the Sunday Times was destined to Iran.
 
(http://www.chron.com/disp/story.mpl/ap/fn/4616249.html)   

There was no mention of Iran in the official communiqué. In fact quite the opposite: the government was pointing its finger at an Anglo-South African conglomerate. According to Le Phare,  the arrest of Fortunat Lumu bears a relationship to the dealings of Brinkley Mining, which had been granted exclusive rights over DRC uranium exploration and extraction.

Moreover, the alleged uranium smuggling took place prior to the employment of two officials with the the country's atomic energy authority. How could these arrested officals have been involved when they wern't even working for the Commissariat Général à l'Energie Atomique.(Le Phare, 8 March 2007)

While the Western media have underscored an alleged " Iranian connection", the undercover network described by the DRC authorities refers to illegal sales to "companies registered in Britain, South Africa and the Seychelles"(emphasis added). Brinkley Mining is registered in the UK with subsidiaries in South Africa and the Seychelles: 

"We're happy with our contract," Gerard Holden, chairman of Brinkley, told Bloomberg News. "We're confident due process will prevail in the Congo," he said.

Bloomberg News said Fortunat Lumu, head of the DRC's Atomic Energy Commission, could not leave the DRC's capital Kinshasa until he had answered questions regarding the award to Brinkley Mining."

( http://www.miningmx.com/wts/672268.htm emphasis added)   

Gerard Holden, chairman of Brinkley

Media Disinformation

The Daily Telegraph's coverage of the evolving DRC uranium scandal, takes on a familiar line: while it has "not been proven" that Iran is behind it, there have  been "a series of allegations" implicating both Iran and the Sicilian Mafia:

It has long been feared that radioactive materials stored there could prove useful to countries seeking to develop fuel for a covert nuclear programme. But none of a series of allegations, including claims that uranium has been sold to Iran and to the Mafia, have ever been proved and the Congolese government has denied that any illegal shipments have been made.

But it is now understood that a long-running government investigation into two missing rods of the highly radioactive uranium produced sufficient evidence to detain the two suspects."{Daily Telegraph, 8 August 2007, emphasis added)

While the July 2006 UN report refers to the Italian mafia, Iran is not mentioned. (See United Nations Security Council op cit)

USA Today in an article entitled "U.N. cuts Iran nuke aid amid uranium-smuggling claims" goes one step further. It states emphatically that uranium was smuggled to Iran, and that the suspension of IAEA technical aid to Iran by the Board of governors meeting  in Vienna (5-8 March 2007) was the direct result of Iran's alleged involvement in the Congo uranium scandal:

U.N. cuts Iran nuke aid amid uranium-smuggling claim The U.N. nuclear watchdog has voted to cut aid to Iran [Board of governors meeting in Vienna], suspending nearly two dozen programs as part of U.N. sanctions. None, however, applied directly to Tehran's uranium-enrichment activities.

The action by the International Atomic Energy Agency comes amid reports that uranium was smuggled to Iran from the Democratic Republic of Congo and that the country's top nuclear scientist and an aide have been arrested. The IAEA said today it is investigating the claims, reported by a Kinshasa newspaper, the BBC says.(USA Today, 9 March 2007)

The BBC in a report entitled "DR Congo 'uranium ring smashed' quotes the Minister of Scientific Research Mr Mushi Bonane,

"a vast network aimed at the fraudulent exploitation of DR Congo's uranium has been dismantled".

"It was a criminal network," he said, without giving any more details. (emphasis added)

Referring to earlier reports that the two officials had been arrested on suspicion of uranium smuggling, Mr Mushi said that the prospection and exploitation of DR Congo's uranium had not yet started.( BBC, March 2007)

In a bitter irony, this report by the BBC is refuted by the BBC's African correspondent Arnaud Zajtman, (BBC Afrique in French), which provides the "missing details". Reporting from Kinshasa, Zajtman  quotes the same statement of the Minister of Scientific Research Mr Mushi Bonane.

[ The two officials] "were arrested for having negotiated an agreement with a foreign company  pertaining to exploration and production."  (BBC Afrique, 9 March 2007, emphasis added)

They are also accused of corruption: 

"The DRC authorities accuse the officials of the nuclear centre for having reached a partnership agreement with a British company, without obtaining the approval of the government." ("Les autorités congolaises accusent les responsables du centre nucléaire d'avoir passé un partenariat avec une entreprise britannique sans obtenir l'aval du gouvernement." (BBC Afrique, 9 March 2007, emphasis added).

Where is the Iran connection? Or is a UK Connection?

What is at stake in the Congo uranium scandal is the granting to a British Mining company (without DRC government approval) of the "first right of refusal for the exploration and development of any uranium projects in the DRC ".(AP, 9 March 2007).

Michel Chossudovsky

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