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Context of 'January 9, 2003: UN Report Says Iraq War Tensions Negatively Affected Iraq Growth'

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A report commissioned by former US Secretary of State James Baker and the Council on Foreign Relations, titled “Strategic Energy Policy Challenges For The 21st Century,” is completed and submitted to Vice President Dick Cheney. The report was drafted by the James A. Baker III Institute for Public Policy. Edward L. Morse, an energy industry analyst, chaired the project, and Amy Myers Jaffe was the project’s director. The paper urges the US to formulate a comprehensive, integrated strategic energy policy to address the current energy crisis, which it attributes to infrastructural restraints, rapid global economic expansion, and the presence of obstacles to foreign investment in the oil-rich Middle East. The report says the world’s supply of oil is not a factor in the crisis. “The reasons for the energy challenge have nothing to do with the global hydrocarbon resource base…. The world will not run short of hydrocarbons in the foreseeable future,” the paper says. One of the report’s recommendations is to “[r]eview policies toward Iraq” with the ultimate goal of stemming the tide of anti-Americanism in the Middle-East and “eas[ing] Iraqi oil-field investment restrictions.” Iraq, under the leadership of Saddam Hussein, remains a “destabilizing influence… to the flow of oil to international markets from the Middle East.” It also notes, “Saddam Hussein has also demonstrated a willingness to threaten to use the oil weapon and to use his own export program to manipulate oil markets.” Therefore, the report says, the “United States should conduct an immediate policy review toward Iraq, including military, energy, economic, and political/diplomatic assessments” and work with key allies to develop a new integrated strategy toward Iraq. Key elements of the new policy should include narrowing the focus of sanctions and using diplomatic means to enforce existing UN resolutions. [University, 4/2/2001 pdf file; Sunday Herald (Glasgow), 10/5/2002; Sydney Morning Herald, 12/26/2002]

Entity Tags: Council on Foreign Relations, James A. Baker, Edward L. Morse, Richard (“Dick”) Cheney, Amy Myers Jaffe, James A. Baker III Institute for Public Policy of Rice University

Timeline Tags: Complete 911 Timeline, Events Leading to Iraq Invasion

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In a paper titled, “The Road to Economic Prosperity for a Post-Saddam Iraq,” which is a part of the study, “A Future of a Post-Saddam Iraq: A Blueprint for American Involvement,” authors Ariel Cohen and Gerald P. O’Driscoll argue for the implementation of neoliberal reforms including the privatization of Iraq’s major industries. The document says that poverty in Iraq is a result of Saddam Hussein’s mismanagement, namely Saddam’s decision to nationalize certain industries; Iraq’s war with Iran; the invasion of Kuwait; and Saddam’s refusal to comply with the requirements for the suspension of UN sanctions. The paper’s proposal for jumpstarting Iraq’s economy focuses on privatization of Iraq’s industries and several other neoliberal reforms. To complement this, the authors recommend using the “media and the educational system to explain the benefits of privatization and the changes to come in order to ensure broad public support.” The costs of reconstruction, they suggest, could be paid for with funds generated from the sale of Iraq’s oil. “Iraq’s vast oil reserves are more than ample to provide the funds needed to rebuild and boost economic growth,” the report says. [Observer, 11/3/2002; Cohen and O'Driscoll, 3/5/2003] But in order to generate this amount, Cohen and Driscoll write, the post-Saddam government would probably have to reconsider its membership in the Organization of Petroleum Exporting Countries (OPEC). “Following the demise of Saddam Hussein, it is unlikely that the Saudi kingdom would transfer a fraction of its production quota under the [OPEC] regime to Iraq to compensate for those lost profits and facilitate its rebuilding,” the authors note. “Iraq will need to ensure cash flow for reconstruction regardless of OPEC supply limitations. Combined with the potential privatization of the oil industry, such measures could provide incentive for Iraq to leave the OPEC cartel down the road, which would have long term, positive implications for global oil supply.… An Iraq outside of OPEC would find available from its oil trade an ample cash flow for the country’s rehabilitation.” [Cohen and O'Driscoll, 3/5/2003] Cohen will later admit in an interview after the invasion of Iraq that his interest in Iraq withdrawing from OPEC was to destabilize Saudi Arabia (see Early 2005).

Entity Tags: Gerald P. O’Driscoll, Saddam Hussein, Ariel Cohen

Timeline Tags: Events Leading to Iraq Invasion

A UN report, titled, World Economic Situation and Prospects 2003, observes that tensions over an imminent war in the Middle East are “having a negative impact on global economic growth through the higher price of oil, rising economic uncertainty and the decrease in business and consumer confidence that they have generated,” and that therefore “an escalation of conflict in that area would only have damaging effects.” The report notes that despite the two-year economic slowdown, “stock prices remain[ed] high relative to traditional benchmarks,” suggesting that continued stagnation in the major equity markets could “send the global economy into a tailspin.” [United Nations, 1/9/2003 pdf file; United Nations, 1/9/2003; Associated Press, 1/10/2003]

Timeline Tags: Events Leading to Iraq Invasion

Former Bush administration press secretary Scott McClellan, reflecting on the buildup to the Iraq invasion, says that President Bush “managed the [Iraq] crisis in a way that almost guaranteed that the use of force would become the only feasible option.” Between the increasingly belligerent rhetoric, the UN ultimatum (see September 12, 2002), and the “massive buildup of American arms and military forces in the region, which, for logistical reasons, couldn’t remain in the area indefinitely without being used,” war became the only viable option. McClellan blames Bush’s advisers as much as Bush, and observes: “[D]uring the buildup to war, the president’s advisers allowed his own hands to be tied, putting Bush in a position where avoiding conflict was more difficult than launching it. By creating this enormous momentum for war, the president and his advisers achieved several things. He made the job of his political opponents extraordinarily difficult, putting those who opposed the war in the position of arguing against what was almost a fait accompli. He trapped Saddam Hussein in a shrinking box, making it less and less acceptable for the dictator to continue to temporize and play games with his neighbors. He forced other countries… to make hard decisions as to whether or not they would permit a US-led invasion absent a clear imminent threat. Most important, the White House forestalled any debate about the fundamental goals and long-term plans for such an invasion. By pushing so hard on the WMD issue, reducing the larger issue of the future of the Middle East into a short-term emergency threat that must be dealt with now, the president and his advisers avoided having to discuss the big issues of what would happen after the invasion. Who would rule Iraq? How would the region respond? How long would the United States have to remain on the ground? How would tensions among the nation’s ethnic and religious groups be resolved? Few of these questions ever appeared on the national radar screen during the run-up to war. But they would come back to haunt the president, and the nation, in years to come, when it became clear that the stated rationales for war—the WMD threat and Iraq’s link to terrorism—were less than convincing. The lack of candor underlying the campaign for war would severely undermine the president’s entire second term in office.” [McClellan, 2008, pp. 142-144]

Entity Tags: Bush administration (43), George W. Bush, United Nations, Scott McClellan

Timeline Tags: Events Leading to Iraq Invasion

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