http://www.commondreams.org/views03/1107-09.htm

Iraq is Not America's to Sell
International law is Unequivocal - 
Paul Bremer's Economic Reforms are Illegal

by Naomi Klein

Bring Halliburton home. Cancel the contracts. Ditch the deals.
Rip up the rules. Those are just a few of the suggestions for
slogans that could help unify the growing movement against the
occupation of Iraq. So far, activist debates have focused on
whether the demand should be for a complete withdrawal of
troops, or for the United States to cede power to the United
Nations.

But the "troops out" debate overlooks an important fact. If
every last soldier pulled out of the Gulf tomorrow and a
sovereign government came to power, Iraq would still be
occupied: by laws written in the interest of another country;
by foreign corporations controlling its essential services; by
70% unemployment sparked by public sector layoffs.

Any movement serious about Iraqi self-determination must call
not only for an end to Iraq's military occupation, but to its
economic colonization as well. That means reversing the shock
therapy reforms that US occupation chief Paul Bremer has
fraudulently passed off as "reconstruction", and canceling all
privatization contracts that are flowing from these reforms.

How can such an ambitious goal be achieved? Easy: by showing
that Bremer's reforms were illegal to begin with. They clearly
violate the international convention governing the behavior of
occupying forces, the Hague regulations of 1907 (the companion
to the 1949 Geneva conventions, both ratified by the United
States), as well as the US army's own code of war.

The Hague regulations state that an occupying power must
respect "unless absolutely prevented, the laws in force in the
country". The coalition provisional authority has shredded that
simple rule with gleeful defiance. Iraq's constitution outlaws
the privatization of key state assets, and it bars foreigners
from owning Iraqi firms. No plausible argument can be made that
the CPA was "absolutely prevented" from respecting those laws,
and yet two months ago, the CPA overturned them unilaterally.

On September 19, Bremer enacted the now infamous Order 39. It
announced that 200 Iraqi state companies would be privatized;
decreed that foreign firms can retain 100% ownership of Iraqi
banks, mines and factories; and allowed these firms to move
100% of their profits out of Iraq. The Economist declared the
new rules a "capitalist dream".

Order 39 violated the Hague regulations in other ways as well.
The convention states that occupying powers "shall be regarded
only as administrator and usufructuary of public buildings,
real estate, forests and agricultural estates belonging to the
hostile state, and situated in the occupied country. It must
safeguard the capital of these properties, and administer them
in accordance with the rules of usufruct."

Bouvier's Law Dictionary defines "usufruct" (possibly the
ugliest word in the English language) as an arrangement that
grants one party the right to use and derive benefit from
another's property "without altering the substance of the
thing". Put more simply, if you are a housesitter, you can eat
the food in the fridge, but you can't sell the house and turn
it into condos. And yet that is just what Bremer is doing: what
could more substantially alter "the substance" of a public
asset than to turn it into a private one?

In case the CPA was still unclear on this detail, the US army's
Law of Land Warfare states that "the occupant does not have the
right of sale or unqualified use of [non-military] property".
This is pretty straightforward: bombing something does not give
you the right to sell it. There is every indication that the
CPA is well aware of the lawlessness of its privatization
scheme. In a leaked memo written on March 26, the British
attorney general, Lord Goldsmith, warned Tony Blair that "the
imposition of major structural economic reforms would not be
authorized by international law".

So far, most of the controversy surrounding Iraq's
reconstruction has focused on the waste and corruption in the
awarding of contracts. This badly misses the scope of the
violation: even if the sell-off of Iraq were conducted with
full transparency and open bidding, it would still be illegal
for the simple reason that Iraq is not America's to sell.

The security council's recognition of the United States' and
Britain's occupation authority provides no legal cover. The UN
resolution passed in May specifically required the occupying
powers to "comply fully with their obligations under
international law including in particular the Geneva
conventions of 1949 and the Hague regulations of 1907".

According to a growing number of international legal experts,
that means that if the next Iraqi government decides it doesn't
want to be a wholly owned subsidiary of Bechtel and
Halliburton, it will have powerful legal grounds to
renationalize assets that were privatized under CPA edicts.

Juliet Blanch, global head of energy and international
arbitration for the huge international law firm Norton Rose,
says that because Bremer's reforms directly contradict Iraq's
constitution, they are "in breach of international law and are
likely not enforceable". Blanch argues that the CPA "has no
authority or ability to sign those [privatization] contracts",
and that a sovereign Iraqi government would have "quite a
serious argument for renationalization without paying
compensation". Firms facing this type of expropriation would,
according to Blanch, have "no legal remedy".

The only way out for the administration is to make sure that
Iraq's next government is anything but sovereign. It must be
pliant enough to ratify the CPA's illegal laws, which will then
be celebrated as the happy marriage of free markets and free
people. Once that happens, it will be too late: the contracts
will be locked in, the deals done and the occupation of Iraq
permanent.

Which is why anti-war forces must use this fast-closing window
to demand that the next Iraqi government be free from the
shackles of these reforms. It's too late to stop the war, but
it's not too late to deny Iraq's invaders the myriad economic
prizes they went to war to collect in the first place.

It's not too late to cancel the contracts and ditch the deals.


Naomi Klein is the author of No Logo: Taking Aim at the Brand
Bullies (Picador) and, most recently, Fences and Windows:
Dispatches From the Front Lines of the Globalization Debate
(Picador).

© Guardian Newspapers Limited 2003 

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