Rep. Dennis J. Kucinich: "Privatizing Iraq's Oil is Theft!"
**Submitted to LOSING THE WAR ON HUMOR by Victor L. Giancarlo, Los Angeles, CA
Dennis Kucinich explains in the 7 minute video (click link below)
how the proposed bill, now pending before the U.S. Congress, via its benchmarks, will provide for the privatization of Iraqi oil. This bill requires the regime in Iraq to pass a law called, "The Hydrocarbon Act." (For more information about the bill, see below.)
As Kucinich explains, if they refuse to do so, over a billion dollars in reconstruction funds will be blocked by the Bush-Cheney administration. This measure, which he characterized as "blackmail," would permit multinational oil corporations---many based in the U.S.--to exercise control over the Iraqi oil. The Democratic leadership in the Congress is giving its explicit support to this legislative device. Unless the scheme is stopped, Rep. Kucinich predicted, we will be looking at an Iraqi War "going on forever!"
Below is more information about the bill:
The Proposed Petrochemical Bill
When the "Draft Hydrocarbon Law" was finally delivered to the Iraqi Parliament on February 18, 2007, key provisions had already been leaked and immediately denounced by the full spectrum of the Iraqi opposition. Taking turns registering dismay were the majority of the Parliament, a wide range of government officials, the leadership of major Sunni political parties, the union of oil workers, the Sadrists -- the most powerful Shia grouping -- and the visible leadership of the insurgency. All this led to many changes in the law, including the removal of all mention of either privatization or Production Sharing Contracts, which would have given multinational oil companies 15-25 years of basically unregulated operational control over Iraqi oil facilities. The amended version in no way excluded the use of PSAs, but it removed the explosive designation from the actual wording of the law. It is worth reviewing the logic of PSAs to understand why the U.S. was so determined to make them a part of the law, and why many Iraqis were soferociously opposed. Production sharing agreements are generally applied in circumstances where there is a strong possibility that oil exploration will be extremely costly or even fail, and/or where extraction is likely to prove prohibitively expensive. To offset huge and risky investments, the contracting company is guaranteed a proportion of the profits, if and when oil is extracted and sold. In the most common of these agreements, the proportion remains very high until all development costs are amortized, allowing the investing company to recoup its investment expenditures (if oil is found), and then to be rewarded with a larger-than-normal profit margin for the remainder of the contract which, in the Iraqi case, could extend for up to 25 years.
THE ENTIRE ARTICLE : http://www.tomdispatch.com/index.mhtml?pid=192709
**2Truthy will return from vacation June 1.