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Oil for Sale: Why the Iraq Study Group Is Calling for the Privatization of Iraq’s Oil Industry

StoryDecember 07, 2006
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Among its recommendations, the Iraq Study Group advised that Iraq privatize its oil industry and to open it up to international companies. Author and activist Antonia Juhasz writes, “Put simply, the oil companies are trying to get what they were denied before the war or at any time in modern Iraqi history: access to Iraq’s oil under the ground.” [includes rush transcript]

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This is a rush transcript. Copy may not be in its final form.

AMY GOODMAN: The Iraq Study Group also recommended for Iraq to privatize its oil industry and to open it up to international companies. The author and activist, Antonia Juhasz, has been closely watching this aspect of the Iraq reconstruction process. She’s author of The Bush Agenda: Invading the World, One Economy at a Time. Antonia Juhasz, thanks for joining us in studio in San Francisco. Your response to the report, not talked about almost at all, the issue of privatization?

ANTONIA JUHASZ: Yeah, absolutely. And good morning, Amy. It’s a completely radical proposal made straightforward in the Iraq Study Group report that the Iraqi national oil industry should be reorganized as a commercial enterprise. The proposal also says that, as you say, Iraq’s oil should be opened up to private foreign energy and companies. Also, another radical proposal: that all of Iraq’s oil revenues should be centralized in the central government. And the report calls for a U.S. adviser to ensure that a new national oil law is passed in Iraq to make all of this possible and that the constitution of Iraq is amended to ensure that the central government gains control of Iraq’s oil revenues.

All told, the report calls for privatization of Iraq’s oil, turning it over to private foreign corporate hands, putting all of the oil in the hands of the central government, and essentially, I would argue, extending the war in Iraq to ensure that U.S. oil companies get what the Bush administration went in there for: control and greater access to Iraq’s oil.

AMY GOODMAN: Antonia Juhasz, let’s talk about the members of this Iraq Study Group. That might explain what their approach has been, particularly James Baker, the former secretary of state, and also Lawrence Eagleburger. Talk about the two of them.

ANTONIA JUHASZ: Both Baker and Eagleburger have spent their careers doing one of two things: working for the federal government or working in private enterprise taking advantage of the work that they did for the federal government. So, in particular, in this case, both Baker and Eagleburger were key participants throughout the '80s and early 1990s of radically expanding U.S. economic engagement with Saddam Hussein, with a very clear objective of gaining greater access for U.S. corporations, particularly oil corporations, to Iraq's oil, and doing everything that they could to expand that access.

Baker has his own private interest. His family is heavily invested in the oil industry, and also Baker Botts, his law firm, is one of the key law firms representing oil companies across the United States and their activities in the Middle East. And Lawrence Eagleburger was president of Kissinger Associates, which was one of the leading multinational advising firms for advising U.S. companies who were trying to get contracts with Saddam Hussein and get work in Iraq.

Now, these two members of the Iraq Study Group are joined by two additional members who are representatives of the Heritage Foundation, and the Heritage Foundation is one of the few U.S. organizations that point blank called for full privatization of Iraq’s oil sector prior to the invasion of Iraq, as a stated goal of the invasion. And to call point blank for full privatization, as I said, is truly radical. It’s actually a shift for the Bush administration, which has for the past about two years been working on a more sort of privatization-lite agenda, putting forward what are called production-sharing agreements in Iraq that would have the same outcome of privatization without calling it privatization.

For the Iraq Study Group, which is supposed to be, you know, the meeting of the pragmatists, the sort of middle-ground group that’s going to help solve the war in Iraq, to put forward this incredibly radical proposal and to have nobody talk about it, to me, is fairly shocking and makes clear that still the Democrats, the Republicans, the media are afraid to talk about oil, but that oil, in my mind, still remains the linchpin for the administration and for all those in the oil sector in the United States, Baker and Eagleburger counted among them, for why U.S. troops are being committed and committed to stay. And the report says troops will stay until at least 2008—I think that is at a minimum—to guarantee this oil access to U.S. oil companies.

AMY GOODMAN: Former Secretary of State James Baker in 2003 went to Rome, Moscow, London, first official trip since he joined the Bush administration as a point person on issues around Iraq in 2003, but remained a senior partner in the law firm, Baker Botts, which, among others, represents Halliburton, as well as the Saudi government, in the suit filed by family members who lost relatives in 9/11. Now, that’s the family members who lost their loved ones versus the Saudi government, and he was representing the Saudi government.

ANTONIA JUHASZ: Yeah, he’s definitely had his allegiance spread, and it almost always, in the bottom line, has to do with oil. And as the public has been very clear in saying in its reports on Baker—or rather, excuse me, the media—that Baker is a pragmatist. He is a pragmatist. The Iraq Study Group report, page one, chapter one, says that the reason why Iraq is a critical country in the Middle East, in the world and for the United States, is because it has the second-largest reserves of oil in the world. The report is very clear.

The report is also very clear, however, that this isn’t a report where the recommendations can be picked and choosed. It says that all of the recommendations should be applied together as one proposal, that they shouldn’t be separated out. That means that the authors of the report are saying that oil, privatization of oil, and foreign corporate access to oil is as key as any other recommendation that they have made.

And the report also says that the U.S. government will withhold military, economic and political support of the Iraqi government, unless the recommendations are met. That’s a pretty straightforward statement. The U.S. government will not provide any support to the al-Maliki government, unless it advances the changes to the Iraqi constitution and changes to Iraqi national law that essentially privatize Iraq’s oil.

That is something for us in the antiwar movement to be very, very clear about, that this is their objective and that we have to, as I repeatedly say, not just call for the end of troops in Iraq, but make clear that the U.S. corporate invasion cannot be progressed or continue, as well.

AMY GOODMAN: Antonia Juhasz, I want to thank you very much for being with us, author of The Bush Agenda: Invading the World, One Economy at a Time, speaking to us from San Francisco.

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