IRAQ: A sordid tale
James Zogby

There’s a sordid story behind Ahmed Chalabi’s falling out with the United States and reports that the Pentagon’s No. 3, US undersecretary of defense Douglas Feith, is losing influence in the Bush administration. It is an intricate tale of deceit, cronyism, and corruption that is only the latest chapter in relations between the two men.

Formerly a part of the Reagan-era defense department’s neoconservative group, Feith left government service to work as a lobbyist representing Israeli and Turkish interests. In 1996, Feith, a supporter of the Likud party in Israel, co-authored a paper for then-Israeli prime minister Binyamin Netanyahu, advising him to end the Oslo peace process. When Netanyahu signed the Wye Agreement, Feith broke with him, accusing the Israeli leader of compromising his values.

Chalabi, for his part, has a long and well-known history of shady business dealings, among them his active courting of pro-Israel and neoconservative groups that led to the passage through Congress of the Iraq Liberation Act (ILA) of 1998.

So much for their separate histories.

Relations between Feith and Chalabi blossomed once Feith was confirmed by the Senate and assumed his post at the Pentagon. Early on, he began to lay out the justification for a war with Iraq. Funds mandated under the ILA had been frozen during the Clinton years. Early in the Bush term, they were freed up to help finance Chalabi’s activities. Chalabi and his group then began to supply Feith’s newly reorganized defense department with ‘intelligence’ on Saddam’s weapons of mass destruction and, later, with ‘information’ linking the Baghdad regime to Al Qaeda.

Both men were willing and eager accomplices of each other’s missions. Both wanted a US war to topple the hated Saddam and would, apparently, go to any lengths to make that happen.

It was Chalabi, among others, who sold Feith both on the ease with which the regime could be removed and the uprising of support for the United States that would immediately follow. It was assessments such as these that provided Feith’s planning office with logic that justified their fatally flawed post-war calculations.

But Chalabi’s fabrications didn’t stop there. Even during the 1990s, it is now known, he was promising the war’s supporters that his post-Saddam Iraq would establish diplomatic and trade relations with Israel and the United States. He and his supporters were, at one point, quoted in the United States to the effect that after Saddam, the Russians and French would be out, replaced by US companies who would be contracted to exploit Iraq’s bountiful oil resources. More quietly, Chalabi was even promising both the Israelis and their US supporters that not only would the new Iraq trade with Israel, but it would resurrect the Iraqi-Israeli pipeline for oil exports. This, of course, was music to their ears.

Shortly after the war began, Chalabi, despite strenuous objection from the US State Department and the CIA, was airlifted with his supporters into Iraq. He immediately began plans to establish a power base in his newly liberated country.

Appointed by the United States to a position on the Iraqi Governing Council, Chalabi assumed the role of director of its economics and finance committee. He was able to place his close relatives and other allies in key ministries and directorships of institutions dealing with Iraq’s banking, finance, and oil resources.

The spoils of war were now within his reach.

One of his nephews, Salem Chalabi, chose not to go into government. Instead, he established the Iraq International Law Group (IILG), which describes itself as “your professional gateway to the new Iraq.” Assisting Salem in setting up the IILG was a partner, Marc Zell (the IILG’s website has been registered in Zell’s name). Zell is an Israeli settler of the Gush Emunim (Bloc of the Faithful) stripe.

Here the plot thickens.

Zell had for many years been Feith’s partner in their Washington-Tel Aviv law firm, Feith and Zell, or FANDZ. This company was set up when Feith left government to pursue work representing Turkish and Israeli interests.

Shortly after IILG opened in Baghdad, Zell opened an office in the United States for Zell, Goldberg & Co., which promises to assist “American companies in their relations with the US government in connection with Iraq’s reconstruction projects.”

It is interesting to note that Zell, Goldberg & Co. still uses the website FANDZ, the site of the old Feith and Zell firm. So when Zell boasts of his connections to government, businesses know exactly what he means.

Since the fall of the Baath Party regime, IILG and Zell, Goldberg & Co. have facilitated contracts in the tens, possibly hundreds of millions of dollars.

Salem Chalabi, incidentally, has also been appointed by the Coalition Provisional Authority to head the Iraqi tribunal that will investigate and prosecute the crimes Saddam and his cohorts committed against the Iraqi people. Meanwhile, his uncle is railing against the former regime’s corruption and is demanding the right to investigate profiteering and kickbacks he alleges occurred in the UN’s oil-for-food program.

Of course, Saddam should be tried for his crimes and lost revenues returned to Iraqis. But for this process to be credible, the Iraqi people should be represented by judges and investigators who are themselves credible.

Beyond this, and for reasons unrelated to this sordid web of corruption and cronyism, it appears that Feith and his friend and co-conspirator Ahmed Chalabi have fallen on hard times.

Feith has been implicated in the Abu Ghraib prison debacle. It was his office that had general oversight of post-war planning (and pre-war propaganda). And it was apparently his office that said the Geneva Conventions did not apply to the Abu Ghraib prisoners. Growing displeasure with his work in this regard (Gen. Tommy Franks has been quoted as calling Feith, the “stupidest guy on the face of the earth”) has caused him to be sidelined. There are also hints he may soon step down from his post.

For his part, Chalabi recently caused some irritation by boasting that it didn’t matter that the intelligence he provided the Pentagon was faulty, because it got the job done. And he has angered his neocon and pro-Israeli supporters by apparently turning his back on commitments he made to them. And he has been accused of providing vital US secrets to Iranian intelligence. His home was recently raided by US and Iraqi forces.

What is intriguing is that in all the recent US media coverage of the changing fortunes of both Feith and Chalabi, there is very little mention made of the questionable business dealings by those closely connected to them.

Both Feith and Chalabi may be facing some difficulties, but don’t count them out quite yet. Feith may leave government, but the last time he left the Pentagon he turned his departure into a business venture and made a handsome profit. And Chalabi, the wily manipulator, has rebound from the setbacks that have marked his past. In short, the final chapter in this sordid tale has yet to be written.

James Zogby is president of the Arab American Institute