Capital Games | The Nation


Capital Games

 Washington: a city of denials, spin, and political calculations. The Nation's former DC editor David Corn spent 2002-2007 blogging on the policies, personalities and lies that spew out of the nation's capital. The complete archive appears below. Corn is now the DC editor at Mother Jones.

W's Biggest Enron Liability: The Case Against Thomas White Grows

Army Secretary Thomas White, a former high-ranking Enron, told reporters a few days ago that "if I ever get to the point....where the Enron business represents a major and material distraction...then I wouldn't stay" at the Pentagon. In Washington, such a statement is often seen as the first step in a graceful exit strategy. Few people, after all, leave office admitting involvement in wrongdoing. They skedaddle because they have become "a distraction." Perhaps White, who was a key man at one of Enron's most shenanigan-ridden divisions, is preparing to jump before being pushed--which would assist the Bush gang's ongoing effort to maintain its distance from the Enron scandal.

Speculation about White's fate aside, what was most interesting about his hourlong session with reporters at the Pentagon--his first extensive comments on the Enron scandal--was that the most damning information about White and Enron went unaddressed. White's remarks focused on his failure to disclose he had held on to Enron stock options after he was required to sell them off and on his trip to Aspen, a stop taken while traveling on military business so he could sign papers related to the sale of his $6.5 million house there. White has drawn the wrath of Democratic Senator Carl Levin and Republican Senator John Warner for not revealing the full extent of his Enron holdings. He has also been criticized for not forthrightly acknowledging all the contacts he and his wife had with his former Enron colleagues after he took office in May, which included discussions at the time Enron was collapsing and White was selling off Enron stock.

These matters are fair game. But they don't hit White where he is most vulnerable: his past at Enron, which White refused to discuss at the press conference. From 1998 to 2001, White was vice-chairman of Enron Energy Services, which sold energy to large enterprises and also traded energy. (In 2001, he made $31 million from Enron.) This division has been accused of overstating its profits by hundreds of millions of dollars through the use of funny-numbers accounting that sometimes involved Enron's now-infamous secret partnerships. EES was Enron at its most Enronish.

But White's line has been that he saw nobody fooling around at the orgy. For instance, regarding the secret partnerships, White said, "When I read about it in the newspaper, I was appalled as anyone else."

His denials are undone by a Dow Jones Newswires story written by Jason Leopold, Mark Golden and Bryan Lee two weeks ago. The trio located and interviewed several former Enron employees who all said that White personally helped mislead analysts and investors about Enron Energy Services. Steve Barth, former vice president for special projects for EES, maintained that White "signed off" on the unusual contracts EES used to boost its paper profits. Another executive said that White "knew we were losing money, and we all agreed, Tom included, that we needed to do whatever we could to make EES look like it was making a profit." Lance Dohman, who was a salesman at EES, claimed White encouraged the unit's sale force to tell people the company was more successful than it was. And several former EES employees said White was part of a 1998 scheme to fool financial analysts into believing EES was a hot property. When analysts visited Enron's HQ in Houston, Dohman and two other sources said, White was present (with Enron chairman Kenneth Lay and Enron chief executive Jeffrey Skilling), as the company asked dozens of secretaries and employees to pretend to be traders buying and selling energy on a trading floor still under construction. The point was to impress the analysts, and at least one prominent analyst says the trick caused him to recommend Enron stock too strongly. (White denied he was present during the analysts' tour.)

Enron Energy Services was a mess. Right before White left, the company restated its 2000 revenues to $1.8 billion from $4.6 billion. Whoops--only off by nearly $3 billion. In essence, White's unit was a fraud. As the Dow Jones story noted, "The unit's former employees have said that its declared profits surprised them in early 2000 because the report contradicted what they were seeing daily: little volume and mostly losses on contracts that had been signed."

So one of the guys in command while this chicanery occurs gets to be in charge of the United States Army? Welcome to George W. Bush's America. White's failure to divest quickly enough, his trip to Aspen, his calls to former Enron pals--that's small change compared to what he oversaw at Enron. And it seems there is no shortage of witnesses who can finger White a chief culprit. His I-didn't-do-the-numbers defense does not hold up. (On March 13, The Washington Post reported that "White has not been implicated in any wrongdoing." The Dow Jones article suggests otherwise.)

The Justice Department has been investigating accounting malfeasance at Enron, but White has not yet been tainted by that inquiry. And there is no sign that White's conduct at Enron is in the crosshairs of any congressional committee. He is not on the list of past and present Enron officials being subpoenaed by Senator Joe Lieberman's government affairs committee; those subpoenas are only hitting members of the company's board. But in addition to worrying about White's stock sales and his post-employment contacts with Enron, legislators should wonder if the secretary of the army not too long ago knowingly managed a fraudulent enterprise. (Be all that you can fake?) Imagine what Republican legislators would have done if a senior Clinton appointee had been connected to this sort of activity.

It is not yet clear whether White is in jeopardy of losing--or abandoning--his position. But he is becoming the administration's most prominent Enron liability. Officials in the Bush White House may believe they have dodged the bullet on Enron, since the matter--especially the political dimensions of the affair--has receded from public and media attention. But, as the Dow Jones article indicates, White is a soft target. The question is, will anyone take aim?

Finally, A Not-So-Bad Bush Doctrine: Poverty Breeds Terrorism

President George W. Bush has joined the root-causes-of-terrorism crowd.

It seems this stunning development has escaped the attention of the conservatives and non-cons who have decried the commentators and analysts who dare assert terrorists are assisted by unwise U.S. foreign and economic policies. If one raises the possibility terrorists find support in other lands partly due to antipathy toward American actions (and not only so-called American values), conservatives are lightning-fast to label such talk the muddled-headed thinking of a self-hating, blame-America-firster. If one speaks of the dire economic and political conditions in which many people overseas are forced to live, such sentiment is blasted as evidence one is soft on terrorism and a coddler of evildoers. Yet when Bush spoke at a recent U.N. conference on international development, he explicitly recognized a direct link between poverty and terrorism and he implicitly suggested that the U.S. policies have not sufficiently addressed this matter.

At the confab in Monterrey, Mexico, Bush said the United States would gradually increase its assistance to poor nations by 50 percent--which would mean in several years a $5 billion boost over current levels. "We fight against poverty because hope is an answer to terror," he declared.

With that sentence, Bush seemingly recognized that terrorism is not irrational behavior unattached from the surroundings in which it arises. And he was acknowledging that "draining the swamp" for terrorists--as Secretary Donald Rumsfeld calls the military action in Afghanistan--requires more than armed force. Bush was saying the United States and the other wealthy nations must counter conditions that can cause people to turn to terrorism or to cheer on terrorists.

Such a statement carries serious implications. It does not excuse or justify terrorism. But it does expand the obligations of those who bear the responsibility for protecting the United States from acts of terrorism. If "hope" is indeed one "answer to terror," then the leaders of the United States must work to expand hope in faraway lands--not an easy or cheap mission. Bush has just assumed a greater burden, one that extends beyond trouncing al Qaeda.

Bush's Monterrey speech received less media attention than his troublesome encounter with a pretzel. But it deserves notice as a marker, an IOU (or we-owe-you). There are, no surprise, signs that he may not make good on this. The United States will place conditions on the money, meaning that recipient nations must pass certain tests to qualify for help. The new standards might be legitimate. For example, the United States could require assurances that the money will not be skimmed by corrupt bureaucrats. But these standards could also follow in the tradition of coercive Western demands that impoverished nations privatize and engage in structural adjustments that cause economic dislocation. Secretary Paul O'Neill has been ordered by Bush to help draw up the rules, and he has long been skeptical of international aid.

The manner in which Bush announced the increase in international assistance also offers reason to question the administration's commitment. A week before heading to Monterrey, following a meeting with rock-star/advocate-for-the-global-poor Bono (of U2), Bush announced he was adding a total of $5 billion to the U.S. international assistance budget over three years, starting in 2004. This news came as other nations were preparing to whack the United States at the U.N. conference for being stingy. After all, the United States has been devoting about .11 percent of its gross domestic product to international aid, while the average of most donor nations is .31 percent.

Bush's announcement undercut the criticism heading his way and earned him a cool photo-op with Bono. (The musician had to think long and hard about sharing his glow with Bush at this delicate time. Apparently, he decided that $5 billion in potential funds was enough help to the poor to warrant awarding Bush the Bono-seal-of-approval.) Then, days before Bush was to leave for Monterrey, the White House said there had been a slight mistake in the original announcement. Bush had not upped international aid by $5 billion. Actually, he had ordered a $10 billion hike. That no one in the Bush White House had previously caught this error seemed to indicate the program was not much of a concern within the senior ranks of the White House or a true priority for top officials there. Yet $10 billion in promises is better than $5 billion in promises. After the new numbers came out, the global development community had even less reason to lambaste the United States at the U.N. gathering.

Ten billion dollars--which Congress must approve--is hardly chump change. And it is hard to begrudge Bono for posing with Bush in return for that--assuming the attached strings don't end up strangling prospective recipients. But as the Center for Global Development and the Center on Budget and Policy Priorities note in a report, while "President Bush's proposed increase for foreign economic aid would result in the sharpest increase in aid spending in decades,...the resulting level of spending on foreign economic aid would rise to only 0.13 percent of the economy or Gross Domestic Product in 2006, still below -- and compared with most years, well below -- the share of GDP the United States contributed in any year from 1946 to 1995. The United States would continue to contribute a far smaller portion of its economy to aid than nearly every other donor country." As the study reports, "Even though European countries already contribute a much larger share of their economies to aid than the United States does, the European Union also recently pledged to increase aid levels significantly in its countries over the next few years."

In the early 1960s, the United States donated over .5 percent of its GDP to poor nations. Since then, the figure has been on a steady decline. Bush has reversed this ugly trend. Yet it would take tens of billions more for the United States to match the current European level. And U.N. Secretary General Kofi Annan has said that in order for the U.N. to realize its goal of halving the number of people living in extreme poverty--1.1 billion individuals now--by 2015, the wealthy nations of the world will have to donate the equivalent of about .7 percent of their economies to international assistance. Bush's foreign aid budget--better than President Clinton's--will be less than one-fourth that level.

The new money will help, if the U.S. program is not suffocated by the to-be-drafted conditions. But the fellow who pushed through a tax cut that showers the wealthiest taxpayers with hundreds of billions of dollars in benefits should reach deeper into America's pocket. (By the way, Bush is asking Congress to spend $27.1 billion next year on military and domestic security needs, in addition to the $40 billion in emergency spending approved late last year in response to 9/11.) Bush has endorsed the view that global poverty is a source of instability and a breeding ground for terrorism. He has indicated he believes the West has a responsibility to redress the deprivations of poorer nations. If attacking global poverty is an essential piece of the war on terrorism--as Bush now says--then in the months and years ahead he ought to be held accountable for how he commands on this crucial front.

Is The Enron Scandal Over?--It's Up to Joe Lieberman UPDATED


Is the Enron scandal over?

It doesn't dominate the Sunday talk shows. It doesn't overwhelm White House press briefings. There is news about indictments of the accountants and continuing coverage of which Enron exec knew what when. But the political dimension of the scandal has slipped from view--though that could be changing.

Capitol Hill investigations so far have focused on the business shenanigans of Enron, not the firm's wide-ranging attempts to obtain political influence in the Bush II and Clinton administrations. Republicans who have repeatedly proclaimed Enron is not a "political scandal" have been winning the battle of late. But a new skirmish on this front is about to break out. As The Hill newspaper has reported, Senator Joseph Lieberman, who chairs the Senate governmental affairs committee, has been preparing to subpoena Enron officials for information regarding their dealings with Bush and Clinton administrations. The subpoenas would cover communications between the firm and government officials dating back to 1992.

Republicans are resisting, and Senator Fred Thompson, the ranking GOPer on the committee, reportedly wants to keep current Bush officials out of the scope of the subpoenas. Thompson, according to The Hill, also is reluctant to back subpoenaing Wendy Gramm, the wife of Republican Senator Phil Gramm. In 1993, Wendy Gramm was chief of the Commodity Futures Trading Commission and she helped set a policy that exempted financial instruments traded by Enron from federal regulation; six weeks afterward, she quit the CFTC and became an Enron director.

The fight over the subpoenas to date has been a quiet affair, but it could spill over to talk-show and finger-pointing circles--and could juice up the Enron scandal. Imagine Bush being asked if he has any objection to Congress issuing subpoenas to examine the contacts between Enron and his administration. A tussle over subpoenas would certainly be welcomed by Democratic activists desperately yearning for ways to make Enron stick to Bush.

It's no secret many Democrats are worried they have little ammunition to hurl at the high-in-the-polls president--especially as the 2002 congressional elections approach and the commander-in-chief takes to the road to help out GOP candidates. When the Enron scandal broke, some Dems regarded it as a magic-bullet that could be aimed at W (metaphorically, of course). In January, Clinton-bud James Carville and consultants Bob Shrum and Stanley Greenberg disseminated a memo that proclaimed, "Enron has the potential to shape the entire political environment for 2002, impact other issues and reduce confidence in the Bush administration and the Republicans." The "entire political environment"? What were they thinking? Did they forget about the war? Moreover, considering that many Democrats, including Lieberman, have sopped up their own share of Enron money (less so than GOPers, but still in significant amounts) and that Democrats have too often happily allied themselves with screw-the-consumer-or-investor-or-worker corporations on various issues (telecom reform, accounting rules, securities law, bankruptcy reform), the party does not have the moral standing to take a clean shot at the Enron-GOP connection, whatever it may be.

One Democrat who does possess the chutzpah and history to decry Enron's intercourse with the Republicans (and the Democrats) is Representative Henry Waxman, a reform-minded and feisty lawmaker from Los Angeles. But his efforts were shot down recently by his longtime nemesis. On March 14, Representative Dan Burton, chairman of the House government reform committee, officially rejected a request from Waxman, the committee's ranking Democrat, for an inquiry into "Enron's political activities and influence." Burton's decision came as no surprise. Burton has enthusiastically delved into such subjects as the death of Vince Foster (he reportedly recreated the Foster shooting in his own backyard by shooting a .38 caliber gun into a pumpkin) and the horrendous last-minute pardon Bill Clinton issued to fugitive financier Marc Rich, yet the wheeling-dealing of Enron did not light his fire.

"While there certainly are issues related to Enron that merit Congressional scrutiny," Burton wrote, "it is not my intention at this time to involve the Government Reform Committee in these matters. His excuse: "there are already 10 Congressional Committees investigating Enron."

In his letter to Burton, Waxman noted that Enron "succeeded--in both the Bush and Clinton Administrations--in having policies [it] sought endorsed." The question is, were any of these successes underwritten by the millions of dollars Enron contributed to both Republicans and Democrats? For Burton's edification, Waxman listed the episodes that warrant scrutiny.

* Bush's energy plan contained policies, including deregulation initiatives, that benefited Enron.

* Vice President Dick Cheney called The Los Angeles Times last April to express opposition to electricity price caps-- a day after he met with Enron chief Ken Lay and discussed Enron's opposition to price caps.

* The Bush White House helped Enron settle a dispute with the government of India over the sale of power plant in Dabhol, India.

* Enron lobbied for a repeal of the corporate alternative minimum tax, and the Bush administration endorsed legislation that contained such a provision.

* Lay met with a White House official to discuss appointments to the Federal Energy Regulatory Commission, which oversees some Enron business activity.

* Bush administration opposition to an effort to increase the disclosure of offshore financial transactions aided Enron, which shielded deals and avoided tax liability by using more than 800 offshore subsidiaries.

* In April 1996, FERC issued orders that helped Enron compete in the electricity market.

* In 1997, Lay and other energy officials met with Clinton and lobbied for an international agreement that would establish a trading system for greenhouse gas emissions. The Clinton administration subsequently supported this concept.

* In December 2000, Congress passed legislation that exempted energy derivative contracts from the oversight of the Commodity Futures Trading Commission. As The Wall Street Journal reported, congressional staff referred to the provision as the "Enron point."

Waxman's letter to Burton did leave out another subject worthy of scrutiny: Enron's success during the Clinton years in winning highly coveted spots on U.S. trade missions and favorable decisions from the U.S. Overseas Private Investment Corporation and the Export-Import Bank. Waxman also did not refer to Enron's possible use of Republican lobbyists to curry favor with the Bush crowd. One Enron hire--its retention of former Christian Coalition chief Ralph Reed--has raised the question of whether the firm improperly assisted the Bush presidential campaign by placing Reed (whose support the campaign wanted) on the Enron payroll.

There is, of yet, little firm evidence Enron did anything illegal as it worked the political system. (Proof, remember, comes from probes.) Congressional investigations, though, need not be confined to criminal matters. How a sleazy company endeavored legally to obtain preferential treatment from the government is a topic worth inquiry. As Waxman noted, "Given the extraordinary success Enron had in influencing policy, it seems appropriate to learn as much as we can how the company operated and whether any wrongdoing occurred."

That's not going to happen in the Republican-controlled House. Which leaves Lieberman as the last hope of Enron-wishful Democrats. How hard will Lieberman press for these subpoenas? How far will his committee go in investigating the political ties of Enron? Without a push now from the Senate Dems, a Hill Democratic aide says, "Enron fades here, unless there are new dramatic revelations regarding the [secret Enron] partnerships."

Is Enron a live political scandal? It is up to Lieberman to decide that question.


On March 21, Lieberman announced that he and Thompson had reached an agreement on issuing a number of subpoenas that will seek information about "Enron's communications with the White House or other federal agencies." The subpoenas will request information from January 1992 through the end of last year. In a statement, Lieberman noted, "We are trying to be as thorough as we can, to turn over every stone we can turn over to understand what government agencies knew about Enron's practices and whether there was anything they could have, or should have done to prevent the company's collapse, and to make sure something like this never happens again."

Lieberman's remark made it seem he is focusing on the question of whether the federal government could have acted to stop the collapse of Enron. His statement did not note these subpoenas could also produce information showing if and how Enron tried to use its political influence to win favorable policies and decisions from the Bush and Clinton administrations. Is Lieberman sidestepping this delicate matter--or being rhetorically restrained for strategic purposes?

A spokesperson for the committee maintains that Lieberman and Thompson did not clash over the subpoenas and that the subpoenas were negotiated without much trouble. The list of past and present Enron officials receiving subpoenas does include Wendy Gramm.

Lieberman said he expects the committee to issue the subpoenas within the next few days.

W's Corporate-Improvement Plan: Breaking with an Enron-ish Past

It may well be easier to preach corporate responsibility than to practice it. At least for George W. Bush. Earlier this month, Bush released a "plan to improve corporate responsibility." When he unveiled his proposal, during a speech at the Washington Hilton Hotel, he did not refer to Enron. But, clearly, this was part of his ongoing Enron-inoculation campaign. (Remember when he griped that his mother-in-law had lost $8000 in Enron stock?) The ten planks of his plan are each related to the Enron scandal. For instance, Bush noted that every investor in a publicly owned company "should have quarterly access to the information needed to judge a firm's financial performance, condition and risks" and that "corporate leaders should be required to tell the public promptly whenever they buy or sell company stock for personal gain." When he proposed the latter point, his hotel audience applauded.

Too bad Bush only has his words, and not his own experience, to offer as inspiration while crusading for corporate responsibility. When he was in the private sector, he and his corporate colleagues violated several of the principles he now champions, including both mentioned above.

In June of 1990, when Bush was a director of Harken Energy, a Texas-based firm that had bailed out his own failing oil company, Bush sold 212,140 shares of Harken for $848,560. This sale came at a time when Harken insiders--perhaps including Bush--had cause to believe the company's future was not so sunny. Weeks after Bush unloaded this stock, Harken announced it had lost $23 million in the second quarter. (See the previous "Capital Games" dispatch on Bush's stock dump). Bush has said this transaction was not prompted by inside information he possessed. But he filed notice of this sell-off with the Securities and Exchange Commission 34 weeks late.

This act of corporate tardiness (tawdriness?) has been widely reported. The Wall Street Journal, for instance, revisited it recently. Less known is an SEC report from 1991 that stated Bush had four times been late in filing notice of stock trades with the SEC. That total included the 1990 sale of Harken stock, and it covered Bush's acquisition of 212,152 shares of Harken in 1986 (17 weeks late), a 1986 exercise of Harken stock options worth $96,000 (15 weeks late), and a 1989 exercise of Harken stock options valued at $84,375 (15 weeks late). This SEC memo, prepared by the agency's enforcement division, was obtained by the Center on Public Integrity in 2000, as part of a joint project with Talk magazine.

Were these late filings merely the result of sloppiness or something more suspicious? In his 1994 race for Texas governor, Bush's late notice on the June 1990 stock dump became an issue. Bush said he had filed the required form and maintained the SEC lost it. An SEC spokesman denied that. And the credibility of Bush's the-dog-ate-my-homework excuse from 1994 is undermined by the fact--not publicly known then--that he was a serial late-filer.

Missing SEC deadlines is not the only part of Bush's private-sector experience out of sync with his proposal for enhancing corporate governance. As the Center for Public Integrity also noted during the 2000 campaign, in 1989, when Bush was a Harken director and a consultant to the company, the firm engaged in a shady, Enron-ish transaction, apparently to conceal its losses. As Knut Royce, a senior fellow at the Center described it,

"Harken masked its 1989 losses when in midyear it sold 80 percent of a subsidiary, Aloha Petroleum, to a partnership of Harken insiders called International Marketing & Resources for $12 million, $11 million of which was through a note held by Harken."

In its 1989 annual report, Harken claimed an $8 million profit on the Aloha deal. This permitted the company to state losses of $3.3 million for the year. But in the fall of 1990, the SEC started giving Harken a hard time about the Aloha sale, questioning how the company could claim a capital gain on the transaction while it had financed the deal through a loan. The following February, Harken filed an amended annual report that wiped away the gain from the Aloha sale and declared 1989 losses of $12.5 million. But by then, Bush had already unloaded most of his Harken shares. And he used the money from that stock sale to pay off a bank loan he had taken in 1989 to buy an interest in the Texas Rangers baseball team--an interest he sold for nearly $16 million several years later.

According to the Center for Public Integrity, there is no evidence Bush was aware of Harken's slippery accounting related to the Aloha transaction. But it's safe to assume that Bush benefited from these Enron-like practices. Had Harken not reported the Aloha deal in a manner that shielded roughly three-quarters of its 1989 losses, Bush's Harken stock would likely have been worth much less in June 1990 when he dumped most of it to raise much-needed funds to cover his Rangers investment. There is no public record of Bush having challenged or chastised Harken for its actions on this front. Not until the Enron scandal did the timely filing of corporate executives appear to be a concern for Bush.

The day Bush released his corporate accountability plan--which left out Treasury Secretary Paul O'Neill's proposal to make it easier to sue errant CEOs--he declared, "The interests of the average investor are sometimes overlooked, especially the need for thorough and timely information about firm performance. And some corporations have used artful and intricate financial arrangements to hide the true risks of the investment." Bush gave no indication he possesses firsthand experience in this regard. But the President knows well of what he speaks. How lucky for him that there was no President raising a fuss about corporate responsibility when he was in the private sector.

Bush's New Nuclear Weapon Plan: A Shot at Nonproliferation

After George W. Bush's tough talk about the "axis of evil" unnerved allies--and forced the Administration to dispense assurances it was not about to go halfcocked after Iran, Iraq and North Korea--the White House has once again supplied the international community reason for the jitters, thanks to its new Nuclear Posture Review. The classified report, first revealed by The Los Angeles Times and then front-paged by The New York Times, is the Pentagon's master plan for developing and deploying nuclear weapons. The document, which lists contingencies in which nuclear arms might be used, notes that the United States might have to resort to nuclear weapons during "an Iraqi attack on Israel, or its neighbors, or a North Korean attack on South Korea or a military confrontation over the status of Taiwan." (The latter, of course, would be a confrontation with China.) The report also states, "Iran, Syria and Libya are among the countries that could be involved in immediate, potential or unexpected contingencies" that would require "nuclear strike capabilities," and it states that the United States could launch a nuclear assault to destroy stocks of weapons of mass destruction, such as biological and chemical arms.

The report certainly will not bolster Bush's image abroad, for it will cause people to wonder if--shades of Ronald Reagan!--this administration is planning for winnable nuclear wars against nations that do not possess nuclear weapons. This leak will also probably cause headaches for Vice President Dick Cheney when he travels to the Middle East this week. He'll want to talk war on terrorism, and the heads of state might be more interested in his ideas about targeting nuclear weapons in their neighborhood. The report is also the latest step in what seems to be a Bush administration campaign to undermine a key foundation of the international nuclear nonproliferation order.

The prospect of using--or preparing to use--nuclear weapons against nations that do not possess them has long been a delicate matter. Nobody expects the Pentagon not to plan for the horrific possibility of nuclear war with another nuclear-armed state. But since 1978 the United States has tried to reassure the world that (more or less) it would not launch nuclear weapons against a non-nuclear-weapon nation. The point of this declaration was to encourage non-nuclear states to sign and abide by the Nuclear Nonproliferation Treaty (NPT). Washington would have a difficult time pressing other nations to forego nuclear weapons, if it reserved the right to blast these countries with its own nuclear arsenal.

This US position--known as "negative security assurances" in arms-control parlance--came with loopholes. Here's how Secretary of State Warren Christopher described it in 1995: the United States "will not use nuclear weapons against non-nuclear weapon states parties to the Treaty on the Non-Proliferation of Nuclear Weapons except in case of an invasion or any other attack on the United States, its territories, its armed forces or other troops, its allies, or on a state towards which it has a security commitment, carried out or sustained by such a non-nuclear-weapon state in association or alliance with a nuclear-weapon state." That is, if a non-nuclear state that has signed the NPT finds itself in an armed conflict with the United States on its own (without being in league with a nuclear-weapon state), then the United States could not hurl nuclear bombs at it.

Now for the rub: Iraq, Iran, Syria, Libya, and North Korea have each signed the NPT. Which means that in a mano-a-mano war against, say, Iraq, U.S. war-managers could not go nuclear.

This policy restriction has been a sore point for conservatives for years. Several weeks before the Nuclear Posture Review earned headlines, John Bolton, the undersecretary of state for arms control and international security, took a significant, but little-noticed, swipe at negative security assurances. In an interview with Arms Control Today magazine, Bolton, for years a right-wing opponent of many arms treaties, was asked if Warren Christopher's 1995 statement remained the policy of the Bush administration. Bolton replied, "I don't think we're of the view that this kind of approach is necessarily the most productive." He noted that the administration's emphasis was not "on the rhetorical" but on "the actual change in our military posture," which would be "embodied in the outcome of the Nuclear Posture Review."

The interviewers from Arms Control Today pressed him, asking, "So, right now, the Bush administration would not make a commitment to non-nuclear-weapon states...that it would not use nuclear weapons?" Bolton answered: "I don't think we have any intention of using nuclear weapons in circumstances that I can foresee in the days ahead of us. The point is that the kind of rhetorical approach that you are describing doesn't seem to me to be terribly helpful in analyzing what our security needs may be in the real world, and what we are doing, instead of chit-chatting is making changes in our force structures." (Making changes? You bet.)

In his responses, Bolton did not acknowledge the role of negative security assurances in the NPT process. It was as if he believed such statements were nothing more than conversational niceties. Which might be true from the perspective of other nations. But if these nations are going to be encouraged by such statements from Washington, then these declarations have great value.

Bolton is the Bush administration's key person--its soul--on arms control issues, and his remarks seemed to mark an abrupt turn-about in a long-standing policy on a highly sensitive topic. But the administration tried to dance its way out of the corner. Shortly after the interview, during the daily briefing of State Department spokesman Richard Boucher, a reporter asked Boucher to explain Bolton's comments and wondered, "Are you now prepared to nuke un-nuked countries?" Boucher claimed "Bolton was reiterating...a policy that the United States government has had since the 1970s." This was exactly wrong. Bolton had dismissed that policy. Then Boucher repeated the statement that Christopher had issued in 1995. So policy reversed was unreversed.

But maybe not. Boucher added a caveat, noting that the U.S. "will do whatever is necessary to deter the use of weapons of mass destruction against the United States, its allies, and its interests." He asserted that "those kind of statements have been made repeatedly since the 1970s," and he quoted a 1996 remark from then-Defense Secretary William Perry, who said that if the United States was attacked by chemical weapons, "we could have a devastating response without the use of nuclear weapons, but we would not forswear that possibility."

In covering for Bolton and claiming nothing had changed, Boucher appeared to have stretched the weapons-of-mass-destruction loophole. He was not only saying, as Perry did, that nuclear weapons could be used in retaliation after a chemical weapons attack against the United States; he was warning that nuclear arms might be used preemptively to prevent such an attack. And that is indeed the policy contained in the new Nuclear Posture Review. If the United States has (or says it has) reason to believe a non-nuclear-weapon state is amassing biological weapons for use against the United States, then that country qualifies for the nuclear hit list.

Bolton, despite Boucher's spin, was indeed speaking for an administration that does not see merit in declaring we-won't-nuke-the-un-nuked in order to enhance nonproliferation efforts. As Bush's disregard of the Anti-Ballistic Missile Treaty demonstrated, this crowd is drawn more to unilateral force decisions than to multilateral nonproliferation endeavors. The more worrisome portions of the Nuclear Posture review may only be what-ifs. But in nuclear diplomacy, what-ifs and words do count. The Bush administration's new weapon plan is a shot against the nations he has rhetorically targeted but also a strike against governments and diplomats that take nuclear nonproliferation seriously.

W.'s First Enron Connection: Update on the Bush-Enron Oil Deal

Editor's note: Below is David Corn's article, posted on March 4, 2002, that first broke news of the Bush-Enron oil deal. An update follows.

Did George W. Bush once have a financial relationship with Enron? In 1986, according to a publicly available record, the two drilled for oil together--at a time when Bush was a not-too-successful oil man in Texas and his oil venture was in dire need of help. Bush's business association with Enron, it seems, has not previously been reported.

In 1986, Spectrum 7, a privately owned oil company chaired by Bush faced serious trouble. Two years earlier, Bush had merged his failing Bush Exploration Company (previously known as Arbusto--the Spanish word for shrub) with the profitable Spectrum 7, and he was named chief executive and director of the company. Bush was paid $75,000 a year and handed 1.1 million shares, according to "First Son," Bill Minutaglio's biography of Bush. Under this deal, Bush ended up owning about 15 percent of Spectrum 7. By the end of 1985, Spectrum's fortunes had reversed. With oil prices falling, the company was losing money and on the verge of collapse. To save the firm, Bush began negotiations to sell Spectrum 7 to Harken Energy, a large Dallas-based energy firm owned mostly by billionaire George Soros, Saudi businessman Abdullah Taha Baksh and the Harvard Management Corporation.

The deal took months to work out. In September of 1986, Spectrum 7 and Harken announced they had reached an agreement. Spectrum 7 shareholders, under the plan, would receive Harken stock. Bush publicly said that Spectrum 7 would continue to operate in Midland, Texas, as a wholly-owned subsidiary of Harken and that he would become an active member of Harken's board of directors. As Minutaglio noted, the deal would give Bush about $600,000 in Harken shares and $50,000 to $120,000 a year in consultant's fees. It also would provide $2.25 million in Harken stock for a company with a net value close to $1.8 million.

As the details of the Spectrum-Harken acquisition--which Bush badly needed--were being finalized, Enron Oil and Gas Company, a subsidiary of Enron Corporation, announced on October 16, 1986, that it had completed a well producing both oil and natural gas in Martin County, Texas. An Enron Oil and Gas press release reported the well was producing 24,000 cubic feet of natural gas and 411 barrels of oil per day in the Belspec Fusselman Field, 15 miles northeast of Midland. Enron held 52 percent interest in the well. According to the company's announcement, 10 percent belonged to Spectrum 7. At that point, Spectrum 7 was still Bush's company. Harken's completion of the Spectrum 7 acquisition was announced in early November.

To spell it out: George W. Bush and Enron Oil and Gas were in business together in 1986--when Ken Lay was head of Enron. (Lay was named Enron chairman in February of that year.) How did this deal come about? Was this the only project in which Bush and Enron were partners? A call placed to the White House produced no response. Karen Denne, an Enron spokeswoman, says "I can't tell you anything about" that project, explaining Enron "sold all its domestic exploration and production assets about two years ago to EOG Reources" and probably did not retain records regarding that well. As for the possibility Spectrum 7 invested in other Enron ventures, she notes, "You're referencing something that happened in 1986. I can check, but we're pretty short-staffed now." Elizabeth Ivers, a spokeswoman for EOG Resources (formerly Enron Oil and Gas), says, "If we did have any records on that well, it would be nothing that we would share with the public. We do not disclose the details or specifics of who we have well interests with."

After the Enron affair began generating front-page headlines, Bush attempted to distance himself from Enron and Lay. In early January, the President claimed he and Lay had not always been close pals. "He was a supporter of [Texas Governor] Ann Richards in my run [against her] in 1994," Bush asserted, noting he did not get "to know Ken" and work with him until after he won that election. But campaign records show Lay donated three times as much money to Bush in that race as he did to Richards. Moreover, contacts between Lay and the Bush family pre-dated that campaign. In 1992, Lay chaired the host committee for the 1992 Republican convention in Houston, where Bush's father won his second presidential nomination. And Lay was a sleepover guest at the White House of President George H.W. Bush.

The Enron-George W. Bush connection goes back further than the President has suggested. But does that mean the relationship between the younger Bush and Lay stretches to the mid-1980s? The deal could have happened without contact between Lay and Bush. But most company heads would be interested to know that the son of the sitting vice-president had invested in one of their enterprises. If Lay had been aware of the partnership, that would not prove the two were pals or that Bush and Spectrum 7 had received undue consideration from Enron. But given Enron's penchant to use political ties to win and protect business opportunities, it is tough not to wonder if this Bush-Enron venture involved special arrangements. This is certainly one more Enron partnership that deserves scrutiny--especially since George W. Bush has yet to acknowledge it. The Spectrum-Enron deal is either an odd historical coincidence or an indication there's more to learn about the Bush-Enron association.


On March 6, two days after this story was first posted, "The New York Times" ran on the front page of its business section a story headlined, "Bush Joined Unit of Enron In '86 Venture To Seek Oil." The article, written by Jim Yardley, essentially reported the facts noted above. Halfway into the piece, it noted, "A columnist in The Nation, the liberal political journal,...wrote about the deal this week in its online edition."

While the Bush White House did not respond to a request from "The Nation" for information, White House spokesman Dan Bartlett told the "Times" the President "has no recollection of this specific deal." Bartlett maintained that in 1986 Spectrum 7 was involved in more than 175 wells. Ted Collins Jr., who was president of Enron Oil and Gas at the time, told the newspaper that Bush did not have "a special relationship" with the company. Collins also asserted that Lay back then "wouldn't have known who Spectrum 7 was and that George W. Bush had anything to do with a company called Spectrum 7."

Since the story was originally posted, I have found records suggesting that Bush's Spectrum 7 had a second partnership with Enron. In May of 1985, a subsidiary of InterNorth, an Omaha-based energy company, announced the completion of a well in Martin County, Texas. According to "PR Newswire," the company said that Spectrum 7 owned an 18.75 percent interest in the well. (The rest was held by the InterNorth subsidiary.) The well, like the one mentioned above, was located at the Belspec Fusselman Field. That same month, InterNorth merged with Houston Natural Gas (HNG)--which gave birth to Enron. HNG/InterNorth changed its name to Enron in 1986, and the InterNorth subsidiary that had invested in the well with Spectrum 7 became part of Enron Oil and Gas. If Spectrum 7 and Enron Oil and Gas had retained their interests in the well, that would mean that Bush's oil company was in partnership with Enron before the deal reported above. Since Bush, according to his spokesperson, does not have a memory for such details and EOG Resources says it will not release any information about wells it has owned, it will be tough to confirm that the InterNorth-Spectrum 7 venture became an Enron-Spectrum 7 enterprise.

On another, more important, Enron-Bush point: Way back in 1994, I reported that Rodolfo Terragno, a former Argentine cabinet minister, had claimed that when he headed the Public Works and Services Department in 1988, George W. Bush, whom Terragno did not know, called him and pressured Terragno to award a pipeline contract worth hundreds of millions of dollars to Enron. (See http://www.thenation.com/doc.mhtml?i=20020204&s=corn.) Terragno, who said he resisted this and subsequent importuning, could not provide proof that the call had occurred. (How can you prove you were phoned by the son of the Vice-President?) Bush's aides denied Terragno's account. But it's worth taking a second look at those denials.

At the time I was pursuing the Terragno story, Bush was running for Texas governor, and I asked the campaign whether Bush had spoken to Terragno about the pipeline project and whether he had any business relationship with Enron. Bush aide Karen Hughes faxed me a terse statement: "The answer to your questions are no and none. Your questions are apparently addressed to the wrong person." An Enron spokesperson said, "Enron has not had any business dealings with George W. Bush, and we don't have any knowledge that he was involved in a pipeline project in Argentina."

The recent news about the 1986 Enron-Bush venture in the Belspec Fusselman Field undermines (to be polite about it) those 1994 statements from Bush and Enron denying any business relationship between the scion and the company. The existence of this oil partnership in 1986 (or one in 1985) has no bearing on the veracity of Terragno's tale. But it shows the credibility of the Bush gang and that of Enron deserve questioning when either one is talking about the other.

Bush Tells Welfare Moms to Work More--How Pro-family Is That?

It's amazing some politicians don't get whiplash when they speak. Take the President. On Tuesday, while unveiling his new welfare plan at a church in Washington D.C., George W. Bush hailed single mothers: "Across America, no doubt about it, single mothers do heroic work. They have the toughest job in our country; raising children by themselves is an incredibly hard job." Yes, indeed, but seconds earlier Bush called for changes in the welfare law that would make life more difficult for single mothers in need of assistance.

The welfare bill passed by the Republican-controlled Congress in 1996 and signed by President Bill Clinton is up for reauthorization--which provides Bush the opportunity to suggest changes and depict himself as a welfare-reformer (which is never a politically unpopular position). His key proposal requires states to have 70 percent of their welfare recipients working--in order to collect their full share of federal welfare funds. Current law calls for states to maintain half of their welfare recipients in work activity, but that requirement can be lowered drastically if a state has reduced its caseload. Bush would repeal this "caseload reduction credit," making the 70-percent figure firm.

That would be a real jolt to the system. The Administration estimates that, due to the caseload reduction credit, states, on average, demand work of only 5 percents of the recipients. (Others say the figure is closer to 30 percent.) Moreover, under the Bush plan, a recipient can only be counted as working if she or he--we're mostly talking about the shes--is participating in 40 hours of work or work-related activities. The rules in place now demand 30 hours. Long story short: all those heroic single mothers struggling to raise kids while working in order to receive federal assistance will have to work longer hours. The "toughest job" just got tougher, or it will, if Bush gets his way.

Call me a fuzzy-headed poverty pimp (or whatever the welfare-reform advocates say about welfare-reform doubters), but I've never understood all the talk about the connection between work and family values. Sure, it is a reasonable policy goal to help low-income parents obtain the skills and support they need to provide for their children. But work and family responsibilities often are in conflict, as many parents know too well. Many social conservatives argue in favor of stay-at-home parenting--just not when the parent is a poor woman with young children who may have been abandoned by a spouse. Such women, according to Bush, must spend more time out of the home and away from their children.

The Bush proposal would also more narrowly define what counts as work activities for welfare recipients. Under the Administration proposal, the first 24 hours (of the 40 hours of work) would have to be in a job, an on-the-job training program, or a community work program. At the moment, if a welfare recipient spends time in a job-search program or vocational education activities, that is considered "work." So if the Bush "reforms" are approved, states will have to push welfare recipients out of job-search training and vocational education in order to meet federal requirements. (Remember, if they don't meet those standards, Washington holds back the cash.) Participation in a drug treatment program or physical rehab program could count for work--but only for up to three months. If your habit isn't cracked by then, if you still need more physical therapy before being able to hold down a job, too bad.

The wonks of the liberal Center on Budget and Policy Priorities provide this example: "Suppose...that a state determined that a recipient had serious barriers to employment--such as a disability, the need to care for an ill or disabled child, a substance abuse program, illiteracy, or a serious domestic violence situation--and that the parent needed more than three months of specialized activities before she could be successful in a 24 hour-per-week work experience or subsidized job program. If, under the Administration's proposal, the state tailored activities to the parent's needs, and capabilities, the state would be unable to 'count' the parent toward the work participation requirements unless the tailored activities matched the narrow set of federally mandated activities." And if the state cannot count that recipient toward the 70-percent requirement, it will have less incentive to provide the assistance that person most needs. Republicans usually assail federal mandates and pine for back-to-the-states devolution. For Bush, states-know-best federalism does not extend to welfare.

In his speech, Bush noted that he wanted to spend $17 billion a year on welfare in the next four years. That sounds generous. But he did not mention this is a freeze in the welfare budget. And since he would push states to place more recipients in more expensive work programs, this amount of welfare spending would end up buying less services. Also, the number of recipients requiring child care (and the number of hours of child care needed) would increase. Yet the Bush plan does not include more funds for child care.

Bush did add money to one program: marriage support. He announced he would propose spending $300 million a year "to help couples who want to get married and stay married." He maintained that "premarital education programs can increase happiness in marriage and reduce divorce by teaching couples how to resolve conflict, how to improve communications, most importantly, how to treat each other with respect." It's hard to object to voluntary measures of that sort. And it is tempting to say, too bad Newt Gingrich (now on wife number three) is not around to shepherd such an initiative through Congress. Or to quip, did you know that 50 percent of the four most recent Republican presidential nominees divorced their first wives? But perhaps if a stressed-out low-income couples had affordable child care and less pressure from the state to enter workfare (instead of, say, a vocational education program), the pair might find it easier to stay together.

The Bush plan has one not-so-dark spot. The 1996 law banned welfare benefits, including food stamps, for many legal immigrants. Bush wants to allow legal immigrants to receive food stamps after residing in the United States for five years. "A legal immigrant who's been working here for five years and raising a family and all of sudden gets laid off and needs a helping hand ought to get food stamps," Bush declared. "The nation must show compassion." But the National Governors' Association and the National Conference of State Legislators have urged that states be allowed to use federal welfare funds to help recent immigrants. To that, Bush says no. What about a legal immigrant who has been working hard for four years? Sorry, compassion has its limits.

"The new system honors work by requiring work," Bush asserted. He also declared, "The welfare system can honor the family." That all may well be true. But a system that honors the family would take individual family needs into consideration. It would not pressure states to place a family head in workfare rather than job training or education programs. It would seek to ease family stress by increasing access to child care. Welfare can work, if policymakers realize honoring work and honoring family are not the same thing.

Bush's War in Afghanistan: A Case of Big Mission Creep?

Did the United States recently engage in an illegal act of war?

On February 19, "The New York Times" placed on its front page a story headlined, "In a Shift, U.S. Uses Airstrikes To Help Kabul." As reporter John Burns wrote, "American forces appear to have opened a new phase in the war in Afghanistan with two bombing raids over the weekend that Afghan commanders in the area said were aimed at clashing militia forces rather than the Taliban or Al Qaeda." The article noted that the U.S. Central Command had issued a statement declaring that U.S. aircraft had dropped precision-guided bombs when "enemy troops" struck forces loyal to the government of Hamid Karzai near Khost. The Pentagon said the pro-government forces had requested the U.S. airstrikes after being attacked by rival troops. Local Afghan commanders reported that the clash involved two tribal militias--but details were murky. Burns noted, "the bombing raids seemed to have placed the United States for the first time in a position of using American air power in defense of the [Karzai] government."

In other words, the U.S. is taking sides in a civil war within Afghanistan. Perhaps that is not bad policy. Perhaps it is in the interest of the United States and good for Afghans for the U.S. military to come to the rescue of the secular, coalition government of Hamid Karzai, which has recently been shaken by the assassination of a Cabinet member and non-stop factionalism. Still, there's a problem. Who gave George W. Bush and the Pentagon permission to wage this sort of war in Afghanistan? Not Congress.

On September 14, Congress passed a joint resolution authorizing Bush to go to war in response to the horrific events of September 11. The resolution did not identify a specific target for Bush. Instead, Congress agreed to a broad but specific definition:

"The President is authorized to use all necessary and appropriate force against those nations, organizations, or persons he determines planned, authorized, committed, or aided the terrorist attacks that occurred on September 11, 2001, or harbored such organizations or persons, in order to prevent any future acts of international terrorism against the United States by such nations, organizations or persons."

Nothing in the resolution allows the United States to use force to protect one militia (be it pro-Karzai or not) from another militia. This appears to be unconstitutional mission creep.

It's unclear whether these bombing raids were a one-time exception or the start of a new pattern of warfare. Karzai has said he will not hesitate to ask for security assistance in order to preserve his government. It certainly looks as if he is going to need such help, and he may well deserve protection and military support. But Bush should not guide the United States into fractious fighting in Afghanistan without first consulting Congress. He is authorized to go after terrorists and their collaborators, not to blast warlords.

Though it did send in the bombers to aid forces allied with Karzai, the Bush Administration has been loath to participate in the peacekeeping force being established in Afghanistan, essentially saying, "That's not our job." But if the White House and the Pentagon want to use force to preserve Karzai's administration, it has two choices. Sign up with the U.N. peacekeeping mission or ask Congress to okay the unilateral use of American troops and bombers on behalf of the current Afghan government. Yes, abiding by the Constitution during wartime can be a pesky task. (And asking questions about the conduct of the war in Afghanistan can be a lonely endeavor. See the two posts below. More information keeps coming out about civilian deaths caused by U.S. airstrikes in Afghanistan. For example, look at the front-page story in today's "Washington Post," which reports that villagers outside of Kandahar say more than 100 civilians were killed during U.S. bombing raids in their area. But what political or opinion leaders have publicly raised concerns regarding the bombing campaign in Afghanistan?)

The joint resolution also poses a problem for the get-Iraq crowd in the Bush White House. So far there is no evidence Saddam Hussein was a party to the crimes of September 11. There is no indication Iraq harbored or aided the perps. Consequently, there is no authorization for a strike against Iraq. (The same would apply to the rest of the "axis of evil"--Iran and North Korea). If Bush does want to attack Iraq--with all the conflicting hints coming out of the administration, it is hard to assess how serious he is in this regard--he will have to do what his father did before the Gulf War in 1991: seek approval from Congress.

But recent events in Afghanistan should give Bush some pause when he ponders assaulting Iraq. It seems that booting a government may be much easier than putting together a government. The Karzai government, after only weeks in office, is endangered by in-fighting and out-fighting. In Iraq, the United States might be able to de-Saddamize the regime. But what kind of government would follow?

While we're on the subject of Iraq, here's a reminder: When Dick Cheney was head of Halliburton, two of the company's subsidiaries did business with Iraq. As "The Washington Post" reported last June, those two ventures "signed contracts to sell more than $73 million in oil production equipment and spare parts to Iraq while Cheney was chairman and chief executive officer." When that story came out, Cheney's spinners tried to distance him from the transactions, which were legal. But executives involved in these deals said Cheney was in a position to be aware of them. By the way, Cheney has long been critical of U.S. sanctions against such countries as Iraq, Iran and Libya, maintaining they punish American companies. In fact, a few months prior to September 11, the Bush Administration was asking the U.N. to end an 11-year embargo on the sale of certain goods--including oil-related equipment to Iraq.

Before September 11, Iraq was a fine place for U.S. firms, like Cheney's Halliburton, to do business. Afterward, Iraq was first among equals in an "axis of evil." Shifting aims in Afghanistan, shifting aims in Iraq. War is slippery business.

US Mis-strikes in Afghanistan: Accidents or Possible War Crimes?

Have US forces in Afghanistan engaged in war crimes?

That's a provocative question, the sort of query that few, if any, reporters at the Pentagon briefing room are going to toss at Rummy. Nevertheless, it's a question that may bear consideration as new details emerge about the latest US mis-strikes.

Over the past week, two US military operations originally touted as successes have turned into PR nightmares for the Defense Department and the CIA First, the Pentagon had to acknowledge (sort of) that a January 24 commando raid that attacked two small compounds in Hazar Qadam--resulting in the deaths of 21 or so Afghans and the capture of 27 others--had been a mistake. Those people killed or grabbed were not, as the Pentagon first announced, Taliban or Al Qaeda fighters, but troops and local officials loyal to the current government. (See the post below.) Then "The Washington Post" reported on Monday that the three men killed on February 4 in the remote village of Zhawar by a Hellfire missile fired from a Predator drone were not Al Qaeda leaders, as the Pentagon had suggested. They were Afghan peasants foraging for scrap metal, and the group did not include Osama bin Laden. Media reports following the attack raised the possibility the Al Qaeda chief had been one of the dead.

The Pentagon was slow to accept the idea that the Central Command and the CIA--which controls the Predator missiles--had goofed. Rear Admiral John Stufflebeem told journalists that US troops at the scene of the attack had found weapons, credit card applications, and airline schedules and asserted that this "would seem to say that these are not peasant people up there farming." But as a subsequent "Post" story noted, the area, once used by al Qaeda as a training camp, had been virtually destroyed during the earlier US bombing campaign. In recent weeks, some local families had returned to the village. Consequently, finding signs of a past Al Qaeda presence at the site would have little bearing on the political loyalties of the three men killed. Several local villagers told Doug Struck of the "Post" that the three men were poor scavengers looking to recover remains of missiles they could sell in Pakistan. (The going rate: four bucks and change for 132 pounds of scrap metal.)

As the success of this Hellfire attack was being questioned, the Pentagon also had to contend with media accounts reporting that several of the men captured at Hazar Qadam and held for two weeks were saying they had been severely beaten and kicked by their American captors. According to the Afghans, US troops hit their prisoners with fists and gunstocks; they bound them and then walked on their backs. As one detainee noted, "They said, 'You are terrorist! You are Al Qaeda! You are Taliban!" And villagers claimed that after the commando attack at Hazar Qadam they found the bodies of men who had been handcuffed. One local says the white plastic handcuffs bore the words "Made in USA."

The US criminal code defines a "war crime" as conduct prohibited by Articles 23, 25, 27 and 28 of the Hague Convention of 1907. There are several aspects of these operations--and perhaps other US actions in Afghanistan--that are not in keeping with these provisions. Article 23 forbids a warring party "to kill or wound an enemy who, having laid down his arms, or having no longer means of defence, has surrendered." The discovery of handcuffed bodies in Hazar Qadam raises the question of whether US troops executed people who were bound. If US troops shot individuals after handcuffing them that would seem to violate this provision. And some Afghan witnesses have told American reporters that the Afghan men attacked by the US Special Forces at Hazar Qadam did try to surrender.

The Hague Convention's Article 25 prohibits "the attack or bombardment, by whatever mean, of towns, villages, dwellings, or buildings which are undefended." Might the Hellfire attack fall into this category, since there apparently were no active defenses at Zhawar? (Certainly, this category is rather wide and would place several US airstrikes and bombardments of the past decade--for instance, President Clinton's missile strike against a pharmaceutical factory in the Sudan--on the wrong side of the law.) Or is an attack aimed at individuals--rather than buildings--okay? But consider Article 25 in regard to a US missile attack that happened on October 21. As described recently by "Washington Post" reporter Molly Moore, on that night in the hamlet of Thoral, first a US missile cut through a trailer containing 27 frightened villagers--mostly children--who were fleeing a bombing raid on a nearby town. Many of the children were ripped apart by the bomb. Then, half-an-hour later, after the injured and dead had been taken to a house, two missiles struck that home. Local witnesses told Moore that 21 members of two farming families--all but four were infants or children--were killed in the attacks. (The Pentagon, of course, insists that its target was a Taliban command center and that all its bombs struck the intended target.) As the Pentagon has tried to hit on-the-run Taliban and Al Qaeda forces, it has obviously bombed undefended targets. Is that merely a technical violation of a rule no one truly heeds?

Federal law also defines war crime as a "grave breach" of the international Geneva conventions, which were signed in 1949. Those treaties--which cover the wartime treatment of prisoners of war and civilians--note that POWs and civilians must "at all times be humanely treated." The agreement covering POWs says that "causing death or seriously endangering the health of a prisoner of war...is prohibited and will be regarded as a serious breach." According to this treaty, prisoners "must at all times be protected, particularly against acts of violence or intimidation," and "measures of reprisal...are prohibited."

If US forces physically abused the Afghans captured during the Hazar Qadam raid, is that a violation of these provisions? What if US troops did shoot prisoners who had been handcuffed? That would make the January 24 action more than an accident--a massacre.

This is not to say that lawyers in the Hague or the US Justice Department should quickly prepare a prosecution. The criminal code provision concerning war crimes is clearly written, but that does not mean there is not wiggle room. For instance, what constitutes a "grave" breach as opposed to a non-grave breach?

The Pentagon has said it is investigating the Hazar Qadam raid to find out what went wrong. But there may be an institutional bias that prevents a no-holds-bar inquiry. On Tuesday, Gen. Richard Myers, chairman of the Joint Chiefs of Staff, said, "The fact that [some of these men] were detained and not killed, I think, is an indication of just how professional and disciplined and dedicated our folks are." Despite Myer's assurances, this probe should go beyond determining why the United States struck the wrong target and killed almost two dozen innocent people. (One guess now is that US forces were duped by local warlords.) The inquiry ought to examine whether US troops also engaged in unnecessarily brutal--and perhaps illegal--conduct during the attack and afterward.

Some Americans, no doubt, would scream in protest at the suggestion that the actions of US soldiers, who are fighting in a faraway land for their country against an unconventional and ruthless enemy that has already killed thousands of American civilians, should receive such scrutiny. Why nitpick about the treatment of prisoners or the deaths of a relatively small number civilians, when everyone realizes that unfortunate acts like these happen during war? But it was George W. Bush who said, in his recent State of the Union address, that "America will always stand firm for the non-negotiable demands of human dignity," including "the rule of law, limits on the power of the state," and "equal justice." He did not announce that America will fight terror with terror to protect itself. Rather, he declared that America is fighting, not just for its own security, but for the values of freedom, liberty and human rights throughout the world.

That should compel US forces to prosecute the war in accordance with international and US laws and in a manner that fully reflects these values. (Yet in the Philippines, as "New York Times" columnist Nicholas Kristof has reported, the American military is making common cause with Philippine security forces operating death squads that summarily execute suspects in their pursuit of the Abu Sayyaf terrorist group.) Blasting civilians, mistreating captives, executing prisoners who are bound--whether these actions (if proven) qualify as war crimes or not, they are out of sync with the President's lofty rhetoric and they undermine the United States' claim to moral leadership in the war on terror.

As the United States presses ahead in its global campaign against terrorism, it is important that it demonstrate it can police itself and hold itself to a high standard of accountability. If Afghans were wrongly killed, mistreated or massacred, punishment should follow for those responsible. When civilians are killed or injured in error, the Pentagon should acknowledge the mistake, and the United States should offer financial compensation to relatives and survivors--as the CIA has done concerning the men killed at Hazar Qadam. If the United States is fighting for justice, its military must be called upon to fight in a just manner.

US Commandos Kill Innocents, CIA Pays Off Kin--A Model Program?

Two months ago, I wrote a piece for the "The Los Angeles Times" proposing that Afghan civilians who had lost relatives, limbs, homes and businesses due to errantly-targeted U.S. bombs receive compensation from Washington. The article was reprinted; I talked up the idea on television and radio. And never have I received more hate mail, with my assailants virulently accusing me of being anti-American and pro-terrorists. Bill O'Reilly bashed me for demanding the United States pay "reparations." But my point simply was that when the United States accidentally inflicted damage upon civilians (such as one young boy who lost his right arm, his left hand and his sight when U.S. bombs struck his home near Tora Bora), it should try to help those harmed. Now, I am happy to note, the C.I.A. is on my side, for the Agency in the past few days has been handing out cash to relatives of Afghan soldiers mistakenly slaughtered by the United States.

On January 24, U.S. Special Operations troops attacked two small compounds in Haraz Qadam, a town 100 miles north of Kandahar. At least eighteen people were killed. Twenty-seven were captured, and the Pentagon announced its prisoners were Taliban and al Qaeda fighters. The daring operation was front-page news. But days later, media reports, based on interviews with local residents, undermined the official account. The townspeople said one of the compounds was being used as a weapons depot for a local disarmament drive and that the Afghans killed and snatched by the Americans were not Taliban or al Qaeda but troops loyal to the interim government of Kabul. According to local Afghans, the bodies of two individuals had their hands tied behind their backs. About a week later, C.I.A. officers were in the field working with tribal leaders to pay $1000 to the family of each Afghan wrongfully killed.

What is interesting is how the Pentagon at first tried to deny a tragedy had taken place. When Craig Smith of "The New York Times" wrote a story questioning the raids on January 28--after interviewing dozens of local folks whose testimony was compelling--the Pentagon, in automatic-pilot fashion, defended the operation. "We take great care to ensure we are engaging confirmed Taliban or Al Qaeda facilities," Maj. Bill Harrison, a U.S. Central Command spokesman, told the newspaper. "As a result of this mission, we detained 27 individuals, and believe that our forces engaged the intended target."

Three days later, after Afghan officials kept insisting innocent troops had been killed, the Pentagon announced it was reviewing the episode. But General Tommy Franks, the Central Command chief, said the Pentagon had no information to suggest friendly forces had been killed. (Guess he doesn't have time to read the papers.) Two days after that, "senior military officials" told the Associated Press that some of those killed, but not all, might have been loyal to the new government and that the individuals captured and killed including persons of mixed political loyalties. Slowly, the Pentagon was backtracking.

On February 4, Defense Secretary Donald Rumsfeld finally acknowledged that "friendly" Afghan forces might have been killed during the raid. Forty-eight hours later, the Americans released the 27 Afghans it had grabbed at the compounds, and the Pentagon announced that not one was a Taliban or al Qaeda fighter. By now, U.S. officials were confirming the C.I.A. was arranging compensation payments. Still, Maj. Ralph Mills, a spokesman for Central Command, maintained, "The release of the detainees isn't an admission that we made a mistake." He asserted that during the raid the U.S. forces had been shot at by "people who weren't in uniform."

This was a weak defense. What did the Pentagon expect? Its commandos hit a compound of soldiers in the middle of the night--a target apparently chosen on the basis of lousy intelligence--and the people attacked shouldn't shoot back? Were the targets first supposed to have asked the Americans to identify themselves? The Afghans probably did not have the chance to do so before being wiped out. Craig Smith reported that a farmer who claimed to have witnessed the attack said he heard people in one compound screaming, "For God's sake, do not kill us. We surrender." And an AP report quoted Afghan witnesses who maintained that no one fired back during the raid. Moreover, these witnesses said that during the attack two local government-appointed officials were handcuffed and shot in a schoolyard by U.S. Special Forces.

The Pentagon cannot yet admit this raid was a massive screw-up--even as the C.I.A. doles out compensation money. (A thousand dollars may go far in Afghanistan, but the Pentagon is getting off cheap.) The U.S. military says that its ongoing inquiry will take another two weeks.

It is worth noting that it took a lot of pressure--from media reports and Afghan officials--to force the Pentagon to concede there may have been a problem with this raid. Recall that the Pentagon's first reply was, we hit the intended target--which is always its first reply when a military action is questioned. Even after Afghan leader Hamid Karzai recently stated that a U.S. airstrike in December that killed twelve people had actually hit a convoy carrying tribal elders supporting his government, the Pentagon still maintains that particular strike was legitimate. Karzai said the Americans had been "misled"--presumably by a local warlord--into believing the vehicles were carrying Taliban. There are indications that the Americans were similarly duped regarding the January 24 raid.

Which raises questions about the performance of U.S. intelligence on the ground. When C.I.A. director George Tenet appeared before the Senate intelligence committee for a rare public hearing on Wednesday, Senator Bob Graham, the Democratic chairman of the committee, said, "I think one of the lessons that we've learned since September 11th is just how good our intelligence agencies are." But a senator could have asked, if they are so good, why are C.I.A. people dispensing cash to relatives of Afghans slain on the basis of faulty intelligence reports? At the hearing, though, none of the Senators raised this issue.

Still, the C.I.A.'s better-than-nothing, hard-money response to the Haraz Qadam tragedy can serve as the foundation for a more humane and just approach to wartime accidents. There are hundreds of Afghan civilians--perhaps more--who have been killed or harmed by U.S. bombs. Rumsfeld has said, "we mourn every civilian death." If that is true, then the Bush Administration should build upon the C.I.A.'s latest program in Afghanistan and compensate all civilians who have been the victims of Pentagon errors. If the C.I.A. supports restitution, how unpatriotic can it be?

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