James Baker's real mission to Europe.

James Baker's real mission to Europe.

James Baker's real mission to Europe.

Military analysis.
Dec. 12 2003 6:40 PM

The Pentagon Plot

Baker's trip isn't about debt, and the contracts directive isn't about money.

Things are not what they seem in the Bush administration's latest internecine imbroglio over Iraq. The mess appears to involve two contradictory developments: 1) the Pentagon's directive banning countries that didn't support the war from sharing in its spoils (i.e., from bidding for reconstruction contracts); and 2) James Baker's impending trip to Europe, on behalf of President Bush, to convince the largest of those antiwar countries to forgive Iraqi debt.

So, it seems, at the same time that Bush is brusquely excluding French, German, and Russian companies from making billions of dollars in the new Iraq, he's nicely asking their governments to chalk off as a loss the billions of dollars that they lent to the old Iraq.

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Many editorialists, Democratic politicians, and foreign leaders are aghast at the incompetence or perhaps the gall of this combination—which amounts to patting the former allies on the shoulder with one hand and punching them in the face with the other.

In today's New York Times, Paul Krugman speculates that something more sinister might be going on—that hard-liners such as Deputy Secretary of Defense Paul Wolfowitz, the architect of Bush's unilateralist policy and the author of the Pentagon's directive on Iraqi contracts, "are deliberately sabotaging reconciliation."

I think there's something to both views—there's bumbling and conspiracy afoot—but the real issue is not trans-Atlantic relations but bureaucratic power.

The key thing to note is this: The Pentagon's directive about contracts is not really about money and, most likely, Baker's trip is not really about debt.

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Officials working for the U.S.-led occupation authority in Baghdad made it clear weeks ago that only "coalition partners" or firms based in those countries would get prime contracts. However, neither that policy nor Wolfowitz's more recent directive excludes any country from winning subcontracts. One official says the contracts are written in a way so that prime contractors enjoy no special advantage. Nor, even with prime contractors, are U.S.-based subsidiaries of foreign firms excluded from placing bids.

In other words, there's plenty of money to be made by, potentially, everybody. The prime contractors may decide—or may be ordered by Washington—not to award subcontracts to firms from certain countries. But that could be done quietly; no one need notice.

So the question becomes: Why did Wolfowitz make such a gratuitously big deal of this? Why did he restate the policy on prime contracts in a public directive—and one with such a nasty tone, to boot? And why did he do so on the eve of Baker's trip?

If Baker's mission were solely about Iraq's debt, it would not be arousing such a fuss. In fact, it would almost certainly not involve Baker at all. Baker is 73, living well, widely and highly regarded as a diplomat and a political operative. As is frequently noted, he served Bush's father well, as secretaries of state and treasury, and he can probably be credited with shoehorning the current President Bush into the White House, thanks to his deft handling of the 2000 Florida recount.

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Baker, in short, is a big wheel, a strategic savior. No one calls on a figure like Baker—no one gives him a White House plane, a portfolio to meet with world leaders, or a promise of unfettered access to the president afterward—for a tech-geek issue like debt-renegotiation.

The whole talk about debt seems like a red herring. Several officials, after all, assume that when a new Iraqi government takes the reins of power, it will simply repudiate the debts of Saddam Hussein.

It can fairly be surmised that Baker, who heads off to Europe on Monday with no accompanying press corps and no obligation to hold news conferences along the way, has been given a broader agenda. Most likely, this agenda involves down-and-dirty turkey-trading—asking what the Europeans need in exchange for bailing the United States out of Iraq (i.e., for supplying troops, money, and international legitimacy) and assuring them, with an authority possessed by no current Cabinet officer, that the president will do the deal.

The objection that the Pentagon hard-liners would have tothis scenario is that it jerks away their control of the occupation. Despite the announcement a few months ago that Condoleezza Rice, the national security adviser, would be taking over the operation, nothing of the sort has happened. Bremer still reports to Secretary of Defense Donald Rumsfeld. The Pentagon still holds the levers. Letting Baker negotiate a deal that reshapes the occupation means surrendering those levers.

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Few if any news reports, about either the Wolfowitz directive or the Baker trip, have noted that a similar Baker mission was in the works last summer—until the hard-liners flexed their muscles and derailed it.

Around noon on Friday, July 25, the Washington Post reported in its online edition that "the White House hopes to persuade" Baker "to take charge of the physical and economic reconstruction of Iraq as part of a broad restructuring of the postwar effort." By 7 p.m., the story was modified: Bush was now "contemplating major changes" in reconstruction policy, and Baker was mentioned as one of the figures he was "considering asking" to "work alongside" Bremer.

By Monday, July 28, the deal was quashed. Baker, the Post reported (online and in its print edition the next day), "will not join the Iraq reconstruction effort, as some administration officials had hoped." The story explained, "When the idea of reaching out to Baker was made public, it quickly became clear that it would be seen as undermining Bremer and any such notion was discarded." (This whole odd sequence was reported in Slate at the time.)

A battle was raging within the administration between the unilateralist neocons (mainly in the Pentagon and on Vice President Dick Cheney's staff) and the multilateralist diplomats (mainly in the State Department, with a few supporters on Rice's staff). Baker was seen, by all sides, as a potent tool for the multilateralists. In August 2002, well before even mobilization for the war began, Baker had written an op-ed piece for the New York Times urging Bush not to "go it alone" in confronting Iraq and to "reject the advice of those who counsel doing so." Most people saw the piece as a signal from Bush's father; it is doubtful that Baker, who remains close to the elder Bush, would have submitted it to the Times without at least tacit permission. The following month, the younger Bush—against the advice of Rumsfeld and Cheney—took his case to the United Nations.

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As recently as last April, Baker, speaking before Toronto's financial elite at the Empire Club of Canada, advocated mending ties with America's allies and working more vigorously with the United Nations.

The hard-liners have seen Baker's intrusion not merely as a disagreement over policy but as a challenge to their domain.

What's going on now has all the appearances of a renewal of this power struggle. The hard-liners couldn't stop this Baker mission, so it looks as if they're doing all they can to obstruct it—to create ill will before it's started and thus to minimize not so much Baker's chance of success as what might go with that success: his ascent to power.

The hard-liners want to keep Baker out, in part because he does not share their vision of the world, in part because they know that he is not the subordinate type. He gets involved in a crisis only if he is allowed to control it; and if he controls the Iraqi occupation, the days of the Pentagon's control are finished.

Bush has almost always sided with the hard-liners, but he is above all a political creature, and he must realize that a quagmire in Iraq could bring down his presidency. It may, in fact, be the only issue (assuming the economic recovery continues) that could doom his bid for re-election. He needs a way out—or a way to bring the rest of the world in. Baker is the one man who has the loyalty to the Bush family, the savvy in electoral politics, and the trust of erstwhile allies. He is, in short, the one man who might pull the trick off.