I’ve always thought that the Oil-For-Food scandal and the parallel scandal (promoted mainly on the left of the blogosphere) about corruption in Iraq’s postwar reconstruction were overblown. Under the circumstances, corruption was inevitable in both cases.If you supported feeding Iraqi children or attempting to repair the damage caused by the war, you had to expect, as part of the overhead, that those with power in Iraq would seek to skim money off the top, and that they would find willing accomplices in this task. Having said all that, corruption shouldn’t be passively accepted. It’s a crime and, wherever they can be caught, those guilty of it should be punished.
By far the biggest fish to be caught in the net so far is Australia’s monopoly wheat exporter, AWB, which was, until 1999, the government-owned Australian Wheat Board. It has become evident that AWB paid hundreds of millions of dollars to Saddam’s regime, and it has now been stated in evidence that the deals in question were discussed with Australia’s foreign minister, Alexander Downer.
Based on past experience, particularly the Children Overboard case, we can be pretty confident of the following
* Both Downer and Howard knew that the AWB was paying kickbacks to the Iraqi regime
* This information was transmitted in a way that preserves deniability, so no conclusive proof will emerge
* No government minister will resign
* Endless hair-splitting defences of the government’s actions in this matter will emerge from those who have previously made a loud noise about Oil for Food.
On the point of resignation, I’d note that the information that had come out before today, showing the AWB up to its neck in corruption, would have been enough, under any previous government to require ministerial resignations, on the basis of the doctrine of ministerial responsibility. But that doctrine is now obsolete in Australia. If anything short of a criminal conviction is considered sufficient to justify an enforced resignation under present conditions, I’m not aware of it.
“Gandhi” has a bit more
John Quiggin 
“so the arguments about what one WA business can or can’t do is redundant and a bit silly”
It’s comments like these that show why we voted to secede from the commonwealth. Still not a bad idea really.
Because the alternative is unthinkable……
Interesting common issue with those large agricultural bodies to do with niche markets.
They end up having a huge influence on the national research effort, and direct it towards broadbrush mass sales solutions to the economic problem. The Wool Board has been a fairly open scandal in this respect, attempting to kill promising lines of research. I think the whole “Cool Wool” thing has been fairly well articulated in public – CSIRO scientists had to hide the research, and pay for it with bits and pieces of money from other projects.
The West Australians, in particular, have been building their Asian wheat market. Huge quantities of udon noodles, for instance, come from WA. It is done by precisely tuning the protein content for specific products, and beating the Americans into markets which are fine for us, but too small for them.
The CBH- AWB tension makes a horrible kind of sense. It is not just efficiencies and proximities to mills; the kind of product and market is different too.
I don’t like the argument that “this is how you do business in corrupt countries so stop fretting and make some money”. It is true in some areas – weapons, for instance. But here both the US and the Canadians stayed out of the market because it was corrupt and illegal. If we had said no too, then perhaps the whole thing could have been prevented.
Instead, we undermined their moral stance, and made the corruption possible. For that, we will get what we deserve, I am afraid to say. We made money out of crime; the fact that the Baathists did not pocket the money privately but used it to sustain their regime makes it even worse.
Yobbo: take WA … please! Secede, begone, ariverderci, a million fewer hillbillies and yahoos for us to feel embarrassed about. Actually, could you take Queensland with you?
Yebbut you’d think that some of the Liberal backbenchers with integrity would have the bottle to be tapping a few shoulders by now.
Oh wait… there aren’t any.
I’m glad we’re all focused on the evil wheat trade and not the entirely benign arms business, where backhanders are, um, de rigeur and profits are orders of magnitude bigger. Still, with Peter Reith calling the shots for Australia’s Tenix we can be certain of honesty and transparency in our nation’s dealings with the machinery of death. But to return to OFF, wasn’t the biggest deal the official US/UK blind eye being turned to smuggling the black sticky stuff – just “one operation involved 14 tankers engaged by a Jordanian entity to load at least 7m barrels of oil for a total of no less than $150m (€113m) of illegal profits” source http://www.globalpolicy.org/security/sanction/iraq1/oilforfood/2005/0113hypocrisy.htm
Paul Kelly: Hehe, we will gleefully secede. The repulic of Westqueenslandia will rule supreme. (Of course, we won’t be taking brisbane with us, or the gold coast).
(Benefit to the freshly truncated australia: Ozzi rules will finally be an international game)
Oh, and one other thought. The US signed Iraq up to wheat contracts with the US when the US openly ran the place (prop. Paul Bremer) in 2003 (see today’s Crikey.com.au). Bribery it seems is to be held as worse than coercion at gunpoint – provided the bribery doesn’t involve any major US business interests. Good to see trade and foreign policy being kept so separate as a matter of pinciple (see John Howard/Alexander Downer passim) And good to see Australia getting full value for its cooperation with the Coalition of the Willing from our great and powerful friends. The one cheery outcome from the AWB OFF imbroglio will be watching young Alexander auditioning for the role of contortionist as he attempts to redefine black as white and do a Stalin on the historical record.
Dogz wrote :
If it were actually true that the opposition could possibly be even half as duplicitous and deceitful as this Governent, then what does that tell you about the health of our democracy?
Does this concern you?
In any case, what has the Labor Party ever done which is remotely comparable to effectively helping to arm the same regime that the Government was to since maintain is a threat to world peace, and then using that pretext to participate in an illegal, bloody and destructive invasion?
Steve,
WA voted to secede in 1932 – the vote was ignored by the rest of you. We would be first cab off the rank in any new push and the passing of the Westminster Act made UK involvement impossible.
.
James, I am not demanding this government’s immediate resignation because, as yet, there is no evidence that the government has done anything wrong. There is an increasing case that Downer may have to resign on a ministerial responsibility basis – I think Rudd is correct to push for evidence in this area – but to say the whole government should go now is to (IMHO) misunderstand the nature of a parliamentary system and the requirement for actual evidence.
“If Gough’s Government had ever been implicated in such a scandal, I don’t see how it could have lasted for more than 5 more minutes in office.
“Why aren’t we all demanding this Government’s immediate resignation? ”
But Governor General Sir John Kerr used his reserve powers to dismiss the Whitlam government on the grounds that the Governor General had the consititutional duty to commission a government that could guarantee supply.
On the other hand, Australia’s current GG Major-General Michael Jeffery would not have any grounds to dismiss the Howard Government. As an ex-SAS officer, Jeffery may nevertheless be distressed that the AWB kickbacks have funded the bullets and bombs aimed at the troops of the COW. What he may or may not do is simply a matter for his own conscience.
However, under Section 75 of the Australian Constitution the High Court of Australia has original jurisdiction:
“In all matters: (i) arising under any treaty…”
An action may be taken in the High Court against the appropriate ministers of the Federal Government in relation to alleged breaches of Australia’s treaty obligations.
A question arises as to who the High Court might regard as a competent complainant in any action against the Federal Government in regard to the treaty obligations of Australia,
Nevertheless, Australia is a signatory to the United Nations Charter and several other treaties relating to the jurisdiction of the United Nations….
The Federal Government may well have a case to answer in relation to its conniving in breaking the trade sanctions against the Saddam regime in Iraq applied by the United Nations.
In the end, the Governor General is required to decide whether the Federal Government has acted properly in relation to adverse judicial finding, and then act appropriately in accord with his reserve powers.
In the vein of ProfJQ’s ‘AWB overboard’, I see the cover of The Land today is “AWB over a barrel” 🙂
Hal9000: agreed, the global wheat trade is one of the toughest and more corrupt but that tough arena includes the lobbying activities of the Canadian Wheat Board which, along with the USA, has been lobbying to dissolve this single desk for an eternity. That is why the canadians first notified the UN about certain suspicious AWB acitivites (maybe back in 2002, i think?), not presumably because of any sense of altruism over the iraqi people but market share, market share.
However, it will be interesting to see the collateral damage over the next few days….Do the ALP support a single-desk idea? Are they willing to drag it down for the sake of the head of a minister? Would farmers be better off in th elong run bargaining individually at long distances and at great cost with foreign markets against the mighty US and Canadians? What is arms-length oversight versus government interference when it comes to divulging the squinty print to politicians? Why did DFAT okay in writing the firm in question? Is bringing transparency and sound ethical corporate governance (of which AWB is not an example) to corrupt markets like the middle east just another example of western imperialism? 🙂
No wonder the USA thought UN sanctions in Iraq weren’t working, they bloody well weren’t.
Oops, mis-ordered my comment. It should have read:
“WA voted to secede in 1932 – the vote was ignored by the rest of you and the passing of the Westminster Act made UK involvement impossible. We would be first cab off the rank in any new push.”
As a side note – remember we have the SAS when they not in Iraq or Afghanistan. I am sure CBH would love to be out from under AWB.
Umm Andrew, after the referendum on seceding, didn’t the WA govt apply to the UK to become a colony again (thus leaving Australia)?
” Yobbo: take WA … please! Secede, begone, ariverderci, a million fewer hillbillies and yahoos for us to feel embarrassed about. Actually, could you take Queensland with you? ”
Closer to two million, actually, and the sentiments are mutual. There is nothing at all for WA in the Federation except the joy of cross-subsidising Tasmanians.
Andrew, the fact that the Commonwelath’s most hardened killers are located in your rebellious capital may not be for your secessionist benefit.
[Joke. It’s so that only Sandgroping nudists see them at work.]
On the wider point, if small business remained loyal after the Manildra tax-system-as-protection-racket episode, I don’t know what it’d take. Groping Wayne Pierce’s daughter?
Steve Edwards: Ditto for Queenslanders. As a bonus, when we secede we can expect all the freeloaders to scarper for Vic or NSW. (Whooppee)
Andrew Reynolds, you’re certainly correct that Western Australia’s CBH would love to escape the restrictions of the AWB.
They are in joint ventures with the Indonesian Salim Group, a grain buyer, to operate flour mills, presenting significant conflicts of interest. They are in effect a grain buyer rather than a grain seller and, unlike the AWB, will work to reduce the prices paid to WA farmers as soon as they can get the AWB destroyed.
Yobbo, how is CBH regarded over there?
Mate, I have nothing against WA-persons. I reckon they’re good people, most of them, but the few bad apples spoil it for everyone. I prefer the rural ones, the urbanised ones are caught between a rock and a hard place, trying to live like the rest of us but they can’t really do it because of who they are. It’s not their fault, it’s the government’s for giving them handouts all these years. They can’t handle alcohol, but that’s not really their fault either.
The average IQ of sand-gropers is shown to be about 10 points below the Australian average, but I think they should be able to live in WA, proudly, in their native state, without do-gooders imposing their politically correct mores onto them.
Western Australian secession … How amusing!
Back in 1933 67% of WA voters supported secession. That’s a democratic triumph in anyone’s language.
So how come we Eastern Staters don’t need a visa to go and join the Sandgropers in a quokka massacre on Rotto?
Easy. The great and the good who led the WA Dominion League stuffed up.
“The Secession Delegation which went to London with such high hopes and great fanfare in 1935 returned to Western Australia within two years in complete failure. After months of lobbying British governments in order to have their petition received by the British Parliament, the delegation could only have the matter referred to a joint committee of the Houses of Commons and Lords. After much delay they rejected the petition on the grounds that the British Parliament could not act without the Australian Federal Parliament’s approval.”
You see Sandgropers weren’t interested in independence. What they wanted was an alternative umbilical cord to the one that had nourished them from the Eastern States.
Sensibly, the British Government didn’t want Sandgropers climbing back into the Imperial womb.
So Sandgropers quietly reattached the Australian umbilical cord and clambered back into the Commonwealth womb instead.
We await the day when Sandgropers grow up sufficiently to commit some act of adolescent rebellion.
Any state that produces Peter Walsh, Graeme Campbell and … John Stone has reason to be a little ashamed and chippy. These are what passes for thoughtul people over there. God help the place!
WA secession requires a change to the constitution, which means a national referendum passed by a majority of voters in a majority of states.
This is a big ask.
Tell you what, sandgropers. I’ll vote yes in a referendum if the rest of Australia gets to keep all the mineral resources north and east of Perth.
Deal?
Katz,
Not quite right. The secessionist government at the time campaigned so hard on the referendum they forgot to campaign for government. The end result was that the government responsible for pushing it through was the party that had kept quiet about it, but opposed it. The team sent was not backed up and, in the end, the Statute of Westminster was invoked to kill the proposal, even though Australia had not actually incorporated it into Australian law.
The whole reason for the secession push was the restrictive trade policies pushed by the east, in clear contravention of WA interests. The net wealth transfer involved not only reduced overall wealth in Australia but affected WA more than the other States due to our strong primary industry focus.
A quick read of “Steadfast Knight” by Hal Colebatch should clear it up, if you really want to know more about it.
.
David,
That would not be the first blatant theft from WA by the Eastern States.
What is “CBH”
OK, Andrew, twist my arm. I’ll throw in Tasmania and the non-wine parts of South Australia.
The trouble with sandgropers is that they think the mineral-fueled wealth is actually due to their sweat, tears and creativity. I’d vote yes in the referendum.
Paul Kelly: You don’t explain what is wrong with those 3 citizens.
However WA has much to explain over inflicting an unmitigated disaster such as Carmen Lawrence onto the rest of Australia.
“The secessionist government at the time campaigned so hard on the referendum they forgot to campaign for government.”
Whose fault was that?
“The team sent was not backed up and, in the end, the Statute of Westminster was invoked to kill the proposal, even though Australia had not actually incorporated it into Australian law.”
1. A 67% majority on the question of secession well might have been massaged into a democratic movement in favour of outright independence. But that was clearly too scary for the Sandgropers.
2. The fact that invocation of irrelevant law was sufficient to deflate the WA secessionist movement suggests that its leadership was inadequate to the task that had been thrust on them by history.
“MarkL perhaps you’d like to refer to the points in the Volcker report where these claims are substantiated. I didn’t notice them, and neither did the Washington Post.�
Sigh. Such an authoritative and unbiased single source. John, you play the wide-eyed ingénue very poorly, and I know you know better, so throw it in.
The Volcker Report was delayed by Annan until the appropriate document destruction in his own office was complete. Were this an action by Howard’s staff, you would not accept it. Why do you accept this? To whit:
The most significant finding in the Second Interim Report (March 2005) is that Iqbal Riza, Kofi Annan’s chief of staff, authorized the shredding of thousands of U.N. documents between April and December 2004. Among these documents were the entire U.N. Chef de Cabinet chronological files for 1997, 1998, and 1999—many of which related to the Oil-for-Food Program.
Riza approved this destruction just 10 days after he had personally written to the heads of nine U.N.-related agencies that administered the Oil-for-Food Program in Northern Iraq, requesting that they “take all necessary steps to collect, preserve and secure all files, records and documents…relating to the Oil-for-Food Programme.� The destruction continued for more than seven months after the Secretary-General’s June 1, 2004, order to U.N. staff members “not to destroy or remove any documents related to the Oil-for-Food programme that are in their possession or under their control, and to not instruct or allow anyone else to destroy or remove such documents.�
Significantly, Kofi Annan announced the retirement of Mr. Riza on January 15, 2005—the same day that Riza notified the Volcker Committee that he had destroyed the documents. Riza was immediately replaced by Mark Malloch Brown, Administrator of the U.N. Development Programme.”
At the United Nations, the senior administrator under Kofi Annan has willfully and deliberately shredded documents that pertained to the greatest rip off in history and Annan lets him retire the same day that he notified Volcker of the document’s destruction. The records were so voluminous that it took seven months to shred them all and Annan professes he knows nothing about it… The responsibility stopped with Annan and for this if nothing else he should be forced to resign
If you believe Annan’s statements on this matter alone, I have a wondrous deal for you concerning this funny-shaped bridge in Sydney, yours for a mere $10K. Cash and used small bills, please.
The US GAO estimates that Hussein earned US$10 billion from smuggling (US$5.7Bn) and kickbacks (US$4.4Bn). These figures make this the largest fraudulent activity in history so far as I know. The idea that Annan knew nothing about it can only believed by the credulous, or the near-terminally biased.
See Claudia Rossett’s work on the matter.
MarkL
Canberra
MarkL, everyone knew that Saddam was skimming money, some from OFF but most from smuggling (which had nothing to do with the UN).
I took this into account in my estimates of the cost of reconstruction back in May 2003 2003.
The US Administration knew it as did the Australian government. And pretty clearly, the Australian government knew that this extended to wheat deals undertaken by its own export monopoly.
I’m still waiting for any credible source (not a freelance journalist who writes for Fox News) for your claims about the PM of Canada etc. Please point to primary sources.
Ernestine Gross asks “what is CBH”?
The following should help:-
http://www.cbh.com.au
EDITED EXTRACT:-
Interesting point, John.
Regrettably, it would appear that Iqbal Riza and various others have shredded their data and that people have used the usual money laundering techniques to shield themselves. I cannot BELIEVE that they did not keep me personally informed with signed hardcopies, either, presentation to your good self on a silver platter for the use of.
I must speak to Chretien and his cohorts about this unforgivable oversight on their part.
But I can point to a primary source for you, the approximately two million documents seized from Iraqi Ba’athist and government archives and as yet untranslated. In addition, the financial records of the Chretien clan’s TotalFinElf holdings will doubtless have an interesting tale to tell, as will Chirac’s dealings as far back as when he was flogging French nuclear equipment to Hussein when he was their ‘Minister for things French, Nuclear, and for Sale to any Bidder at all’.
If I think of anyone else to whom the gentlemen in question have provided signed hardcopies of their nefarious doings various, rest assured that you will be the first one I inform.
All wry humour aside, you know as well as I do that the pattern of business transactions and political decisions (and other things) points to these charming chaps being dirty. Asking me to provide court-of-law proof is a nice rhetorical flourish, of course, but means little beyond perhaps scoring a point or two in a game of words.
But I can certainly ‘point you to primary’ sources, as requested, and have done so. I will forbear to request from you primary sources proving the opposite conclusion.
MarkL
Canberra
“But I can point to a primary source for you, the approximately two million documents seized from Iraqi Ba’athist and government archives and as yet untranslated. ” (Emphasis added)
You’re joking, right?
JQ,
MarkL has you by the short and curlies.
It obvious that the allegedly shredded documents bore out the claims in great detail. The only thing standing in the way of incontestably proving this to be the case is the lack of evidence, but this is a mere trifle as it’s known exactly what the shredded documents contained, notwithstanding the inability to examine them. I’m sure the 2 million untranslated Iraqi documents will eventually become available for our edification.
Ummm, why would the UN shred documents. Clearly if the UN had nothing to HIDE, those documents would have exonerated the UN.
Clearly the UN is *guilty*guilty*guilty* I am trying to think of JUST ONE THING the UN has done FOR humanity within my lifetime… just one…!!
Steve, given your willingness to convict “the UN” on the basis of unsupported claims about document shredding by an anonymous blog commenter, I assume you are convinced of the involvement of Howard and Downer on the basis of the publicly reported evidence.
Publicly reported evidence shows that the Government had no knowledge of the transactions http://www.news.com.au/story/0,10117,17868461-421,00.html
Notwithstanding John’s confidence in the unproven Alan Fels calls for the AWB monoply to be broken up; “time has come to close down the Australian Wheat Board as an export monopoly. It’s a relic of a bygone age.”
http://www.abc.net.au/7.30/content/2006/s1551333.htm
“I am trying to think of JUST ONE THING the UN has done FOR humanity within my lifetime… just one”
Eradication of smallpox.
Hal9000,
Must have been someone else who did that……It couldn’t have been the evil UN.
rog says,
“Publicly reported evidence shows that the Government had no knowledge of the transactions”.
That isn’t quite what the article says. The strory qoutes AWB documents as explicitly stating that it would tell the government about the extra payments, but not until the ‘appropriate time’, suggesting, but not confirming, that such a time might be after the Iraq war.
I think I read an anonymous blogger somewhere reporting that it was a known fact that the AWB shredded all the relevant documents that would prove Alexander Downer not only knew about the practice, but was a personal beneficiary of the OFF scandal. Damn shredders!
Hopefully the several million untranslated Iraqi documents will shed some light on this too.
Also, Rog, the article only refers to one particularly dubious transaction just before the war. The implied background is that AWB was in regular contact with DFAT and government about these deals. But of course, nothing will ever be proved, as I said at the outset.
“Steve, given your willingness to convict “the UNâ€? on the basis of unsupported claims about document shredding by an anonymous blog commenter”–jquiggin
MarkL’s claims are supported by Paul Volcker.
Second Interim Report
Click to access InterimReportMar2005.pdf
Now what about your claims and an apology to MarkL?.
OK, I misread that comment. I withdraw the suggestion that the claim about Riza and shredding was unsourced. To restate my point to Steve “If you’re willing to convict the UN on the basis that some embarrassing files were shredded by one of Annan’s offsiders, I assume you;re willing to do the same for Howard and Downer on the basis of 100+ “I don’t knows” from the head of their export monopoly.
The semantical hairline crack that MarkL Canberra crawls through to play the old game of bait and switch is his deliberate misconstruction of JQ’s phrase “By far the biggest fish to be caught in the net so far…”.
Disingenuously, MarkL Canberra asserts that Secretary General of the United Nations, President of France, the PM, the President of Russia are “bigger fish”. And in the big world of affairs, indeed they are “bigger fish” than the AWB.
But it is clear from the context that JQ intends “biggest fish” to mean that the AWB were the largest suppliers of graft money to the Saddam regime.
So Australia’s own AWB in this instance stood tall and outclassed some truly heavy-weight crooks. Let’s hear it for the Little Aussie Battler!
And that’s why Howard apologists on this blog and elsewhere are finger-pointing in every direction except in the direction that Australian citizens can do something positive to punish the guilty. That is, in Australian political forums, in Australian courts of law and in Australian penitentiary facilities.
Katz no one has denied that the AWB paid bribes. A few have said that the Govt knew about and condoned these activities yet are unable to support these allegations with evidence.
Perhaps if there was an enquiry it would be found that the AWB have paid bribes for decades; that’s the way business is done in many countries.
At this point what is reasonably clear is that the bribes were paid to shift Australian wheat and there seems to have been no personal gain, unlike the UN personnel who have profited from receiving bribes.
Katz
At this time its $US2 million of an estimated $10 Billion and above scandal. Inexcusable but not the “largest suppliers of graft money” so far.
1. Gary,
http://finance.news.com.au/story/0,10166,17815518-462,00.html
“The Cole inquiry has also received thousands of previously confidential documents from the UN’s own inquiry into the oil-for-food program, headed by former US central banker Paul Volcker. The Volcker report said AWB was the biggest single provider of kickbacks to Saddam’s regime.”
I believe the figure quoted by Volcker is about $300m.
2. Rog,
I’ll leave it for St Peter at the Pearly Gates to decide whether or not graft for private gain is worse than graft as a betrayal of the public trust.
“I am trying to think of JUST ONE THING the UN has done FOR humanity within my lifetime… just one…!!”
Ended the Cambodian civil war; kept the Turkish and Greek cypriots from killing each other for the past 30 years; monitored the India-Pakistan cease-fire line; stopped the war between Eritrea and Ethiopia.
Want me to go on?
Thanks Katz.