The Iranian Cycle - A retrospective collection
   of daily columns


The Road Out Of Iraq Is Through Tehran - May 5, 2004
The Bush administration is learning something rather unpleasant about Iraq. The way out is likely through Tehran. And that sets up a significant set of very negative logistics for the future.

According to a report on Stratfor.com, citing an Iranian newspaper, negotiations between Shiite cleric Al-Sadr, and the United States are under way, and are being mediated by “representatives dispatched by Qom-based Grand Ayatollah Kazem Hossein Haeri.” The interesting twist, is that according to Stratfor, al-Sadr, is Haeri’s protégé.

The net effect would be three fold in the short term. First, Stratfor notes that the “Iran Daily report suggests Haeri might be engineering a deal that would require the Mehdi Army to stand down and relinquish control to the CPA, allowing the United States to avoid a potentially explosive situation.” Second, Stratfor reports that “Haeri is asking the CPA not to try al-Sadr for the April 2003 murder of Grand Ayatollah Abdul Qasim al-Khoei until after the transitional government takes office July 1.”

And third“ “negotiators representing al-Sadr are lobbying for the Mehdi Army to be recognized as a legitimate political party so it can compete in future elections. The negotiators say if the CPA accepts these demands, al-Sadr will order his men to stand down.”

What the U.S. is asking, in addition to the standing down of the Mehdi Army, is not mentioned. But it would make sense that some kind of retribution, such as the naming, and identifying, or even eliminating of the foreign jihadists involved in much of the mayhem in Iraq, or perhaps even exchange of intelligence about Al-Qaeda.

Another interesting omission from the report, is the fact that Ahmed Chalabi’s name is nowhere to be seen, as a factor.

Stratfor concludes that “Tehran is very interested in stabilizing the situation in Iraq -- quickly -- and Washington has no qualms with Iran's involvement in taming al-Sadr. The more important issue is whether these talks will lead to an agreement, and what the terms would be. If and when a deal is reached, the United States will be able to boast to its allies that it has defused an explosive situation. Tehran again will be able to bring home its importance to the Bush administration, demonstrating its unique ability to exercise influence among Shia of all stripes.”

And while, it is possible that if this is a successful set of negotiations, the United States will be able to spin it positively, the long term success of the venture is dubious. As long as the Shiite majority in Iraq is in charge, the United States and Iran are too far apart ideologically. In fact, if this is first step toward the U.S. withdrawing from Iraq, face intact, one thing will remain clear.

Bottom line? If the U.S. makes a deal with al-Sadr, it will send one message loud and clear. It would essentially legitimize al-Sadr’s standing as a major political figure in Iraq, with Iran and the U.S.’s blessing.

In effect, it would signal that the United States has just christened the newest Islamic theocracy in the World.

Only time would tell if that is a good thing or otherwise. But, we think that it would not be a very long time before the World found out what the results would be.

The Cordesman Report - May 7, 2004
“The United States can no longer win the insurgency war in Iraq militarily, according to a new report.” The World Tribune, on 5-6 reported that “the Washington-based Center for Strategic and International Studies asserted in a new report that the United States no longer has a military solution for Iraq. Authored by Anthony Cordesman, the report said any U.S. military solution would result in massive civilian casualties and collateral damage and fail to end the Shi'ite or Sunni insurgency.”

The Tribune, quoting from the Cordesman report continued with ["The U.S. can of course defeat the Iraqis. However, any military solution is now likely to be the kind of ('victory') that creates a new firestorm over excessive force, civilian casualties, and collateral damage. At the same time, the U.S. cannot hope to kill or arrest all of the Sunni and foreign insurgents that exist now and is almost certain to create far more than it destroys."]

The controversial Cordesman report concluded that ["At this point, there simply is no way to eliminate cadres of insurgents or to disarm the most threatening areas. Falujah and similar areas have too much popular support for the insurgents. There are too many arms that can be hidden and too many points of vulnerability. This does not mean the U.S. should give up fighting the insurgents or its efforts to disarm them. It does mean the U.S. must accept that it cannot win in the sense of eliminating them or turning hostile areas into secure and disarmed areas."]

The Tribune added that “Cordesman, who completed a tour of the Middle East, said the United States lacks viable options other than to empower Iraqis with responsibility over security. He played down the prospect that the United Nations could create stability or political legitimacy.

“Another recommendation was that U.S. military commanders should be empowered to approve security aid to Iraq. At the same time, Washington should threaten to leave Iraq if an interim Iraqi leadership fails to cooperate in the effort to form a stable and efficient government. The United States should also continue to expand the role of the Iraqi security forces. At the same time, the report said, the United States should not repeat the ["Israeli mistake of assuming that any Iraqi authority in hostile areas can be counted on to provide security for Americans."]

The report discussed Iranian-backed cleric Moqtada Sadr, head of the Mahdi Army, and warned against any U.S. attempt to assassinate him. The killing of Sadr, the report said, would create a martyr that would push Shi'ites into an alliance with the Sunnis in a development that would ensure nationwide resistance.

The Stumbling White House - May 17, 2004
According to our inside the beltway sources, Washington D.C. is consumed with the potential consequences of the Iraqi prisoner scandal, and the recent beheading tragedy. And there are repeated hints that the White House is also listening.

One thing the stock and oil markets may not have begun to factor in is what could happen if the U.S. pulls out of Baghdad, whether by a deal or because Bush has to do something that dramatic to save any chance he may have left to win re-election. The main worries continue to be higher interest rates, oil shortages, the potential for a melt down in the Chinese economy, and rising uncertainty before the election. The usual suspects are also in the mix, rising U.S. budget and trade deficits, and geopolitical risk.

We are not sure as to what would happen ourselves, if Bush decides to pull the plug on Iraq, other than to suggest that the story is so outside the realm of the conventional wisdom, that it would almost certainly be a shock to the system.

The only question remaining to be answered is whether it would be a positive or negative shock.

But the fact that the State Department is gaining visibility and strength of purpose of late, while the Pentagon is scrambling to stop the bleeding caused by the guerilla war and the prisoner abuse scandal, suggests that there is a less than subtle power shift in the Bush administration.

If Powell and the doves are getting the upper hand, as it seemed likely over the weekend, Wall Street is going to have to re-evaluate the U.S. political landscape. And that could provide for some interesting trading.

The Breaking Ranks - May 7, 2004
There is now almost open warfare in the Bush ranks, as Rumsfeld is trying to rally the troops and Powell is trying to keep the ship from sinking.

Powell made some rather open remarks over the weekend, which may or may not have come with the White House’s blessing.

Stratfor.com noted, in a situation report that “U.S. State Secretary Colin Powell, responding to a question as to whether the U.S. government would accept an Iranian-style theocratic regime for Iraq, said the Bush administration would accept any rule chosen by the Iraqi people in the planned January 2005 elections, even an Islamist one.”

This, in a way, confirms recent reports about the U.S. having been working with Iran for some time, but especially lately.

It also confirms the main premise of our own recent article, written on 5-12, in which we concluded that “if the U.S. makes a deal with al-Sadr, it will send one message loud and clear. It would essentially legitimize al-Sadr’s standing as a major political figure in Iraq, with Iran and the U.S.’s blessing.” In effect, it would signal that the United States has just christened the newest Islamic theocracy in the World.

Conclusion - May 7, 2004
Bottom line. Bush is stuck in Iraq. And unless he can deliver a decisive clear and unambiguous victory before the political convention season starts, his sagging poll numbers could get worse. In fact, if Kerry makes no mistakes and just hangs around, unless the White House can pull out of this latest dive, Kerry just might win the election, unless enough people decide that he is such an unknown quality that he does not deserve a chance to be president.

Furthermore, Mr. Bush seems to be rapidly losing his grip on his cabinet, and his own party’s vote of confidence.

As predicted here, by our inside the beltway sources, the metamorphosis of how the president has been perceived, as a strong leader, to that of being seen as a weak, ineffective leader, may well be underway.

If Mr. Bush has a rabbit inside his hat, this seems as good a time as any to pull it out.

But the fact that the dominant voice for the White House over the weekend was Colin Powell suggests that Bush is as much out of ideas as he seems to be running out of time.

The Islamic Mini-State - May 26, 2004
Imagine, masked mujahedeen parading nearly naked prisoners with blood stained backs from having received 80 lashes throughout the streets of the city, barber shops being prohibited from giving “Western” style haircuts, and women covered from head to toes on the rare occasions when they are allowed to leave their homes.

Are these scenes from Afghanistan before the U.S. invasion? No...actually they are scenes from Fallujah, Iraq, just three weeks after the U.S. Marines pulled out. And more interesting, this may be the model on which the U.S. bases its exit strategy from Iraq.

This may be what President Bush was talking about when in his Monday night speech, he alluded to an Iraq that would have control of its own destiny. This is what Secretary of State Colin Powell may have meant that the U.S. would allow Iraq to turn into, an Islamic Republic, if that was the will of the Iraqi people.

On May 5, 2004, in a story titled: “The Road Out Of Iraq Is Through Tehran,” we concluded that “if the U.S. makes a deal with al-Sadr, it will send one message loud and clear. It would essentially legitimize al-Sadr’s standing as a major political figure in Iraq, with Iran and the U.S.’s blessing. In effect, it would signal that the United States has just christened the newest Islamic theocracy in the World.”

So far, there has been no sign of a deal with Sadr. But the fact is that the U.S. has made deals with somebody in Fallujah, and Karbala. And those deals have created the feeling that some kind of peaceful solution is now possible, and that the model used in those two cities could be the model that brings and end to the constant violence in Iraq, and sets up the potential for a U.S. withdrawal.

But a closer look reveals that at least in Fallujah, something different than the beginning of a traditional democracy is what is actually taking place.

According to a 5-25 story from AP: “With U.S. Marines gone and central government authority virtually nonexistent, Fallujah resembles an Islamic mini-state - anyone caught selling alcohol is flogged and paraded in the city. Men are encouraged to grow beards and barbers are warned against giving "Western" hair cuts. ["After all the blood that was shed, and the lives that were lost, we shall only accept God's law in Fallujah,"] said cleric Abdul-Qader al-Aloussi, offering a glimpse of what a future Iraq may look like as the U.S.-led occupation draws to a close. ["We must capitalize on our victory over the Americans and implement Islamic sharia laws."]

In fact, the reason Fallujah has become “peaceful,” as described by President Bush in his speech, is that in some cases, Taliban like rule is now increasingly evident. According to AP: the mujahedeen have implemented a "clean up" campaign. An example, according to the wire service was something like this: “Four youths with long hair were stopped at a market by mujahedeen on Sunday and marched to a public market where they were shorn.” Another described example went like this: “Residents said a man found intoxicated last week was flogged, held overnight and released the next day.”

The question must be asked if there was indeed much progress made in Fallujah, if Saddam’s rule of fear has been replaced by something equally as brutal in many ways. Of if that’s just the way things are going to get done there from now on.

In a sense, AP concludes that “with the departure of the Marines, the position of the U.S.-appointed civil administration has been weakened in favor of the clerics and the mujahedeen who resisted the U.S. occupation. That is a pattern that could be repeated elsewhere in Iraq after the occupation ends June 30, unless other legitimate leaders come forward to replace those tainted by association with the occupation.”

To be sure, Iraq deserves an opportunity to become whatever its people decide. And some kind of peace is better than the anarchy of the past several months, accompanied by hundreds of deaths on all sides. But, somehow, we get the feeling that this is not exactly what the masterminds of the U.S. invasion had in mind some 13 months ago when the invasion began. And somehow, it just doesn’t seem as if the rest of the world is going to be very forgiving if Iraq becomes the next Afghanistan of the recent past or Iran.

Did we go through all the trouble and grief to install a Taliban regime in Iraq? The grim answer to the question, is that maybe, just maybe, the White House has seen enough and decided that it was time to let the natural order of things in Iraq take its course, while the U.S. goes about its business in the war on terrorism elsewhere.

We’ll be watching the direction of White House leaks and of subsequent Bush speeches. But frankly, for Iraq, barring some major earth shattering set of developments, it probably doesn’t get much better than Fallujah.

What does any of this have to do with the stock market? In the perverse and twisted logic of Wall Street, an Iraq which remains nice and quiet because of a new iron fist, in this case, an emerging Islamic theocracy, is not likely to cause as much trouble as one in which a tyrant who likes to invade his neighbors is in charge. Unless of course, the emerging theocracy turns out to be expansive and aggressive...and oh yeah… just happens to stumble into the WMD stash that no one has found, but that may still be there, according to some reports dispersed within the conventional arsenal.

But the that is something to think about later. Maybe for now, an Iraqi theocracy is just enough reason to buy a few stocks...at least for a while...

Something Wicked This Way Comes - June 7, 2004
The Bush administration may have opened the highly feared Pandora’s box in the Middle East. Events are beginning to unfold that are beyond the usual realm of unintended consequences. In fact, if the situation, which has become somewhat more calm in Iraq, changes its primary venue to Saudi Arabia, and Iran becomes increasingly and perhaps openly involved, we could see the total unraveling of the region.

There could be something worse than Al-Qaeda lurking in the Middle East. It could be better funded, better trained, and even more deadly. And it could be the unexpected thing that both rattles the White House, shapes the election’s outcome, as well as leads the Middle East over the edge of chaos and into disorder.

While the U.S. election and the new government in Iraq are getting all the press coverage, an alarming development has taken place in Iran, as b> the Iranian government has hosted a conference for suicide bombers. According to Middle East Newsline: “The conference was sponsored by the Iranian government and its state-financed Center for the Appreciation of the Martyr. Iranian news media said the conference had gathered candidates from around the world for a meeting in Teheran. The Fars News Agency said the conference was part of the events to mark the anniversary of the death of Iranian revolutionary leader Ayatollah Ruhollah Khomeini. The conference included envoys from a range of Islamic insurgency groups sponsored or financed by Teheran. The conference began on June 2 and included senior commanders of the Iranian Revolutionary Guard Corps. Members of Khomeini's family also addressed the conference.”

There has been no notice of this that we have found in the mainstream media.

Stratfor.com has been noting the story for a few days, though, and we have been monitoring carefully. But Stratfor has been persistent on their coverage, and on 6-7 noted the following: “Two things appear to be going on. First, the Iranians are letting the United States know that al Qaeda is far from the only concern Washington will have if events continue along their current trend in Iraq. If Tehran is not going to get the deal leaders thought they had nailed down - a neutral to pro-Iranian government in Baghdad -- Iran will respond in exactly the way the United States doesn't want: opening a new front with suicide bombings. Iran is also delivering a message to al Qaeda and Saudi fundamentalists. These groups have criticized the Iranians and Shiite Muslims intensely for collaborating with the United States, and Iran's radical credentials have been tarnished. With these announcements, the Iranians are reasserting their claims as leaders of Islamic fundamentalism and reminding the Sunni Wahabbis that Iranians were carrying out such operations 20 years ago, while the Saudis were the ones collaborating with the Americans.”

Strafor added this: “A few weeks ago, there was word that Iranian suicide squads were being trained to attack Western targets. That story went quiet for a while, but this weekend, the leaks began again. Agence France Presse moved a story on Sunday about a group called the Committee for the Commemoration of Martyrs of the World Islamic Movement -- citing an Iranian newspaper, Shargh, as the source. This time, the group had a spokesman, Mohammad Samadi, who reported that he has signed up 2,000 for the martyrs campaign. According to Samadi, ["Suicide operations are the best way to fight the oppressors, and they have already shown their worth in Lebanon and during the war between Iran and Iraq."]

That means that as the press is settling on the Bush version of events, that although violence will increase in Iraq, things are on their way to recovery, something more sinister is going on. Stratfor concludes that “if Washington moves along the line of realignment with Sunnis in Iraq, it really could wind up with another, even more dangerous version of al Qaeda. If the United States tries to placate the Iranians, it will have even more problems in Saudi Arabia. The Saudis have been doing all the things the Americans have asked for, and they are now virtually in a civil war because of it. If the United States moves to placate the Iranian Shia, that would not only be another nail in the coffin of the Saudi government, but would increase the sense in the region that the United States is now simply responding to pressure and no longer has a serious plan.”

More interesting is this notion, supplied by Stratfor: “We are getting the sense of a further radicalization in the Islamic world. We also are sensing that this further radicalization might create non-Islamic coalitions that don't currently exist. It is a process we will be watching intensely.”

The Vanishing Nuclear Plant - June 15, 2004
June has not been a good month for Iran. First, it did not get Baghdad handed to it on a silver platter by the U.S. And now, the IAEA, is well, coming close to thinking about maybe at some point playing hardball with regards to nuclear weapons that Iran may have nearly developed or worse. For the IAEA to even consider that time is running out on a country that it is inspecting is a major deal.

According to Reuters: “Iran is not fully cooperating with U.N. inspectors and must come clean about the full extent of its nuclear program, the head of the International Atomic Energy Agency (IAEA) and the United States said Monday. IAEA chief Mohamed El Baradei said Iran's cooperation has been ["less than satisfactory"] and warned that clarification of unresolved issues -- particularly Iran's uranium enrichment activities -- could not be allowed to drag on forever. A diplomat from one of the 35 nations on the IAEA Board of Governors said he was surprised by the force of the IAEA chief's words: ["The speech by (ElBaradei) was severe. It was serious."]

According to Reuters: ["It is essential for the integrity and credibility of the inspection process that we are able to bring these issues to a close within the next few months, and provide the international community with the assurances it urgently seeks regarding Iran's nuclear activities,"] he (El Baradei) told the IAEA's board of governors.”

ElBaradei’s distress seems to center around the somewhat veiled allegation that Iran has lied to the IAEA. Reuters reported that “ElBaradei highlighted concerns over the detection of traces of low-enriched and highly enriched uranium at sites in Iran, and over Tehran's work with advanced P-2 centrifuges -- two items diplomats say could indicate interest in weapons. P-2 centrifuges are used to enrich, or purify, uranium for use in an atomic reactor or in a nuclear weapon.”

More important “information provided by Tehran on its P-2 program had been ["changing and at times contradictory,"] ElBaradei said.

Immediately that got us curious. Why would the usually sedate ElBaradei get all hot and bothered and sweaty around the collar?

If we believe a recent report at Debka.com, the answer is not just that things had been “changing and at times contradictory,” but that as in Iraq, the IAEA, seems to have a similar problem to UNMOVIC’s disappearing buildings.

According to Debka: “The most secret section of the latest report the International Atomic Energy Agency’s director Mohammed ElBaradai has drafted on Iran’s nuclear program is also the most embarrassing for the international nuclear watchdog.” Quoting its intelligence sources Debka reported that they have access to information that “reveal(s) exclusively that when inspectors arrived in Iran in mid-May and asked to revisit installations they saw in February or April, they were astonished to find empty spaces. When they questioned their Iranian escorts, they were greeted with blank stares. [“What installations?”] the officials asked.”

Debka continued with “The inspectors pulled out photos from previous visits and showed the Iranian officials what had been there before. The Iranians dismissed them as having been shot in other places that looked the same - or grafted there by [“hostile intelligence bodies.”] When the inspectors persevered and reported the existence of aerial photos showing the exact location of the missing facilities, the Iranians shrugged. The Iranians had amazingly dismantled and spirited away all the structures containing incriminating evidence of continuing uranium enrichment for weapons production so completely that there was no sign a building had ever stood there. The fresh flowerbeds were still in the same places as before but the lawns had been extended to cover the former sites, most probably with thick layers of earth. All the inspectors could do was to remove soil samples and take them away.”

A Suspicious Caravan - June 15, 2004
The second interesting development of the day also involves Iran. According to Stratfor.com: “Stratfor sources have confirmed that Ukrainian forces apprehended a ["humanitarian"] caravan accompanied by 40 armed Iranian nationals that was crossing from Iran into Wasit Province, in east-central Iraq. Coalition officers, including Americans, are interrogating the Iranians, who were arrested during the week of June 7-12. This could be the first evidence that Tehran is attempting to carry out its threat to attack U.S. forces in Iraq.”

The intelligence service eerily suggests that this could be the signal that something worse is coming: “Iranian sources -- likely prompted by the government in Tehran -- hinted June 6 that a group called the Committee for the Commemoration of Martyrs of the World Islamic Movement had as many as 2,000 suicide bombers ready to attack U.S. targets in Iraq and possibly elsewhere. If true, the latest intelligence from Ukraine not only could prove indirectly that some forces inside Iran are preparing attacks against American targets, but also that the Iranian government -- or hardliners within its intelligence services -- are taking practical steps to achieve their goal by sending hit squads across the border.”

According to Stratfor, the Iranians offered no resistance, but apparently expected to be released quickly after being stopped. But, the next revelation calls that story into question: “The Iranians reportedly say they crossed the border to visit Shiite holy sites and to deliver humanitarian aid to their Shiite brethren. Though some food bags were found in the caravan, so were weapons -- including plenty of small arms, several grenade-launchers and grenades, several land mines and walkie-talkies, which the detainees claimed they needed to guard the caravan.”

Stratfor’s ominous conclusion: “ Tehran, which has seen its plans for a pro-Iranian Iraqi government fall by the wayside, could be past the stage of issuing threats. This incident, in fact, could be the first evidence that Tehran is following through on warnings to Washington that it is capable of unleashing major attacks against U.S. forces.”

Conclusion - June 15, 2004
Not only has Iran reportedly held a convention for suicide bombers lately, but it seems to have mastered Saddam’s old tricks of moving things that didn’t need to be seen by the International community, and maybe on its way to heightening its war of words against the United States into a war of deeds.

Debka’s report is not substantiated. But ElBaradei’s public display of near anger, and the well placed leak by the “diplomat” quoted by Reuters, suggests that indeed something major did happen, and that it could have gone beyond questionable data and evidence concerning centrifuges.

If Iran can dismantle a nuclear plant and cover it with a well manicured lawn in a few weeks, life is only going to get more interesting in the Middle East once the Iraqis begin to attempt self governance.

And if Stratfor’s report on the armed caravan is any clue as to what may be in the pipeline, something very bad may be starting in Iraq, just when the U.S. and the newly installed Iraqi government are thinking that some kind of order is about to prevail.

Focus On Iran - June 16, 2004
On 6-15, we reported that: “Stratfor sources have confirmed that Ukrainian forces apprehended a ["humanitarian"] caravan accompanied by 40 armed Iranian nationals that was crossing from Iran into Wasit Province, in east-central Iraq. Coalition officers, including Americans, are interrogating the Iranians, who were arrested during the week of June 7-12. This could be the first evidence that Tehran is attempting to carry out its threat to attack U.S. forces in Iraq.”

The intelligence service eerily suggests that this could be the signal that something worse is coming: “Iranian sources -- likely prompted by the government in Tehran -- hinted June 6 that a group called the Committee for the Commemoration of Martyrs of the World Islamic Movement had as many as 2,000 suicide bombers ready to attack U.S. targets in Iraq and possibly elsewhere. If true, the latest intelligence from Ukraine not only could prove indirectly that some forces inside Iran are preparing attacks against American targets, but also that the Iranian government -- or hardliners within its intelligence services -- are taking practical steps to achieve their goal by sending hit squads across the border.”

And on 6-16, there is even more evidence that as Iraq settles into a new stage of activity, Iran is going to become the new focal point of the news cycle.

To be sure, the mainstream media is not sure as to what it is dealing with, as it focuses on the bluster and well choreographed dance of well dressed and articulate ministers and diplomats put forth by Iraq to foster its international image of a model society.

But, outside the United States, the coverage is not particularly flattering, and is threatening to unleash a torrent of controversy.

>Iran’s Saber Rattling - June 16, 2004
Is Iran about to attack Iraq? On Jun. 15, according to UPI “Iran reportedly is readying troops to move into Iraq if U.S. troops pull out, leaving a security vacuum.“ The wire service, quoting “the Saudi daily Al-Sharq al-Awsat, monitored in Beirut, reports Iran has massed four battalions at the border. Al-Sharq al-Awsat quoted ["reliable Iraqi sources"] as saying, ["Iran moved part of its regular military forces towards the Iraqi border in the southern sector at a time its military intelligence agents were operating inside Iraqi territory."]

But as reported by VOA News.com later in the day: “Iran's state-run news agency IRNA quotes what it calls ["an informed source"] as denying a report in a Saudi-owned newspaper that says Iranian troops are massing on the border with Iraq.” VOA added that “IRNA quotes its source as saying the report is ["fabricated and baseless"] and is meant to help the United States continue its occupation of Iraq.”

China, Iraq, And North Korea.. An Interesting Triangle - June 16, 2004
The U.S.-China Economic and Security Review Commission says that China, Korea, and Iran are involved in a dangerous alliance.

According to a report on the International Herald Tribune, quoting Reuters: “China is sending nuclear technology to Iran in exchange for oil and allowing North Korea to use Chinese air, rail and seaports to ship missiles and other weapons, congressional investigators reported Tuesday. “ The Tribune added that the Congressional Report added that “Beijing ["continues to permit North Korea to use its air, rail and seaports to transship ballistic missiles and WMD-related materials, "]and that “Chinese leaders have told the Americans that any nuclear-related trafficking is done without the government's knowledge.”

Also interesting is the fact that “the State Department recently sanctioned five Chinese companies for trading with Iran, but the commission criticized this focus. The commission said that many Chinese companies have direct ties to top-level government and military officials. .The commission said China's growing energy needs were ["driving it into bilateral arrangements"] that may involve ["dangerous weapons transfers."] Iran is a key oil-producing country.”

"This need for energy security may help explain Beijing's history of assistance to terrorist-sponsoring states, with various forms of WMD-related items and technical assistance, even in the face of U.S. sanctions," the commission said.

The Unseen Side Of Iran - June 16, 2004
While the public side of Iran is increasingly about bluster, threats, and saber rattling, there is a much darker side lurking beneath the surface. And it is one which over the long term could significantly harm any successes that Iran might achieve, peacefully, or otherwise, in its quest to become a dominant power in the Middle East and the world.

As the politics over nuclear power raged in Vienna, according to the BBC “Iran has the highest proportion of hard drug users of any country in the world. Cheap opium and increasingly refined heroin flood over the border from Afghanistan. Some estimates put the number of users as high as three million - one in 20 of the population. In such a rigid society in which public dancing and music were - until recently - illegal, drugs have become a common form of recreation. Junkies are a common site on the streets of the major cities. Prostitution, too, is commonplace.”

In fact, the BBC article, dated June 16, 2004 notes that there are parts of Iran “which are never seen in the west, where junkies sprawl on streets littered with needles.”

In a June 10 report written by Donna M. Hughes, Professor & Carlson Endowed Chair, Women's Studies Program, University of Rhode Island, and posted at the Persian Journal Website (www.iranian.ws), we found this: “Joining a global trend, the fundamentalists have added another way to dehumanize women and girls: buying and selling them for prostitution. Exact numbers of victims are impossible to obtain, but according to an official source in Tehran, there has been a 635 percent increase in the number of teenage girls in prostitution. The magnitude of this statistic conveys how rapidly this form of abuse has grown. In Tehran, there are an estimated 84,000 women and girls in prostitution, many of them are on the streets, others are in the 250 brothels that reportedly operate in the city. The trade is also international: thousands of Iranian women and girls have been sold into sexual slavery abroad.”

Hughes added: “The head of Iran's Interpol bureau believes that the sex slave trade is one of the most profitable activities in Iran today. This criminal trade is not conducted outside the knowledge and participation of the ruling fundamentalists. Government officials themselves are involved in buying, selling, and sexually abusing women and girls.”

The alarming report continued with: “Drug addiction is epidemic throughout Iran, and some addicted parents sell their children to support their habits. High unemployment ? 28 percent for youth 15-29 years of age and 43 percent for women 15-20 years of age is a serious factor in driving restless youth to accept risky offers for work. Slave traders take advantage of any opportunity in which women and children are vulnerable. For example, following the recent earthquake in Bam, orphaned girls have been kidnapped and taken to a known slave market in Tehran where Iranian and foreign traders meet.”

And there was more: “Police have uncovered a number of prostitution and slavery rings operating from Tehran that have sold girls to France, Britain, Turkey, as well. One network based in Turkey bought smuggled Iranian women and girls, gave them fake passports, and transported them to European and Persian Gulf countries. In one case, a 16-year-old girl was smuggled to Turkey, and then sold to a 58-year-old European national for $20,000.”

The report coincides with the release of the US State Department’s fourth annual [‘Trafficking in Persons Report’] released on Monday (6-14), in which according to IANS: “Bangladesh, Burma, Cuba, Ecuador, Equatorial Guinea, Guyana, North Korea, Sierra Leone, Sudan and Venezuela could face sanctions as their governments have failed to contain the menace.”

Secretary of State Powell added: “Modern-day slavery — smuggling people for organized crime, including sex trade and forced labor — plagues every country in the world, including the US. The trade in people is a major source of revenue, in the billions, for organized crime, along with the drug trade and the arms trade. What we have here is a denial of human rights, a threat to public health, and a threat to security and stability.”

Powell also alluded a potential link to slavery although he did not offer that there was proof of such a link.

Conclusion - June 16, 2004
All wars uncover aspects of societies that are shocking. This one is no different. Aside from the Abu Gharib prisoner scandal, and the Chalabi revelations, the United States has revealed much about its intelligence gathering faults. Much has been learned about where the White House, for the past several administrations could have done better. And much remains up in the air about what will happen next.

Iraq has been revealed as a country whose sadistic dictator raped and pillaged the treasury while enslaving the people.

The Saudi government’s long standing problems have come to light.

And now, we are getting a glimpse into Iran, a multifaceted society where government and religion are one entity, but where the maldistribution of wealth is still a problem, and where a festering underprivileged class of ill and addicted victims is growing.

Indeed, as Iran fights to become a member of the “nuclear club,” it seems that it has a more pressing internal problem, HIV and heroin, much as China, and Russia do in the latter respect.

In today’s report, three seemingly unrelated stories paint a darkening panorama for the Middle East and the rest of the world.

As governments vie for power, they are ignoring their most important resource, their people. And somewhere inside it all, there is a single force that connects it all, an ever growing seed of evil, vice, addiction, and crime which continues to permeate every aspect of the increasingly disorderly landscape. To paraphrase Tolkien, One force to rule them, one force to bind them. One force to bring them all, and in the darkness bind them. Indeed, in today’s world, terrorism may be the factor that finds rules them, brings them and binds them.

History shows that when those in power follow similar courses, those governments are toppled, from the inside as we saw with the Soviet Union, or from the outside as with Iraq.

It seems to us that part of Iran’s preoccupation with nuclear weapons is as much about preserving its government’s grip on power from real or imagined outside threats, as it is perhaps from the significant problems it faces internally.

The New Cold War - June 30, 2004
The mainstream media and the intelligence analysts cite the end of the Cold War as the major reason for the emergence of terrorism, and as providing the environment that spawned Al-Qaeda.

But in an ironic turn of events, the toppling of Saddam Hussein, and the change in the balance of power in the Middle East have created a new Cold War of sorts.

Thus, while the terrorists continue to prosecute their guerilla warfare, in the halls of power, in Washington, London, Tehran, Baghdad, and the United Nations, the seeds of a new era in international intrigue have been planted. And recent actions, beginning with the capture of British soldiers by Iran, and the expulsion of Iranian “security guards” by the U.S. suggest that the New Cold War is just beginning.

Iraq’s Prime Minister Iyad Allawi, in his first official statement after the handover of power, made conciliatory comments toward Iran and Turkey. Iraq’s government called the handover of power a positive development. But below the surface, Iran is most unhappy about the turn of events in Iraq, and having been mostly left out of any major direct role in Iraq’s political structure.

In fact, an interesting set of developments has begun to unfold. And the way that it resolves will likely set the tone for relations between the U.S. and Iran. And by default, it will also greatly affect what develops between Iran and Iraq.

According to AP, on 6-29: “The United States expelled two security guards at Iran's U.N. mission for photographing ["sensitive"] sites in New York after two previous warnings about such picture-taking, U.S. officials said Tuesday. Iran's U.N. Mission denied the charges, saying that the guards photographed only typical tourist attractions in the city.”

The article added that “The United States took action after the FBI recently observed the pair videotaping, State Department spokesman Adam Ereli said in Washington. The incident occurred in May, a note to the Iranians said. ["These individuals were moving around New York City and essentially surveilling, taking photographs of a variety of New York landmarks and infrastructure and the rest,"] said Stuart Holliday, the U.S. deputy ambassador to the United Nations.”

In fact, the U.S. has charged Iran with spying on the U.S., as “Holliday said the guards were ["engaged in activities that were not consistent with their duties"] diplomatic language for spying.”

This is not a new situation, apparently. But it is one that has obviously come to a head. According to AP, quoting “a U.S. official who spoke on condition of anonymity, the first photographing incident by Iranian guards took place in June 2002 and the second in November. New York Police Commissioner Raymond Kelly said in November that two Iranian citizens were questioned while taking video images of the subway tracks on the No. 7 line in Queens. He said the two men, stopped by a transit officer, claimed diplomatic immunity and were ultimately not charged with any wrongdoing. The commissioner declined to label their behavior suspicious, but called it ["unusual."]

And while this was a little noticed situation by the mainstream media, it is an important situation because of the potential repercussions that it can have for the geopolitical situation, and the Middle East, if it gets out of hand.

According to Stratfor.com: “The situation will escalate in the coming weeks into a series of diplomatic tit-for-tat spats. Iran will likely respond to Washington's latest move with an expulsion of its own within the next two weeks, likely of a CIA operative it might have identified in Iran.” Stratfor thinks that “Iran does not want a war with the United States. It does want a managed escalation in tensions that will force Washington to acknowledge Persia's natural and enduring hegemony of the gulf region. It also wants the United States and Britain to back off the nuclear issue.”

In fact, according to Stratfor‘s analysis: “Iran has invited the Americans to play a game of diplomatic chess. The detention of the eight British sailors June 21 and their release three days later was meant as an opening salvo. The message broadcast to Washington via London was that Tehran could and would have a say in the military and political affairs of Iraq and the gulf. Five days later, the United States made its move.”

But here is where things could get interesting: “The decision by the United States to retaliate for the British sailor's detention -- rather than let London respond -- suggests Washington is happy to join the contest. It is likely both sides will continue to fuel the crisis, with Iran taking carefully calculated moves meant to provoke a carefully calculated response -- and vice versa.”

In the end, it is not likely that this will end up well, since the stakes are high for both sides. The U.S. has no intention of giving up ground gained in Iraq, while Iran still has grand visions for its role in the region. According to Stratfor: “The critical question is how far Washington will let this go. Tehran is playing a subtle game and expects the United States to respond as carefully. Washington is not known for subtle responses in general -- and at this point in history has a low tolerance for political games with Muslim countries. It certainly is not going to cede hegemony in the gulf to Iran over the detainment of a few British sailors or a single CIA spy. Nor is Iran about to let its centuries-old dream of controlling the Persian Gulf go up in smoke over losing a couple of U.N.-based spooks.”

Musharaf’s Iron Curtain - July 2, 2004
The situation in the Middle East is near a major inflection point, and the break could be at any time.

Indeed, it looks as if Pakistan’s Musharraf may have hit the nail on the head when he noted that “an iron curtain is descending between the West and the Muslim world,“ during a speech on Monday (7-5) in Sweden. ["This iron curtain somehow is dividing the Muslim world on one side and the West on the other side. This is very dangerous,"] he told Reuters in an interview after the speech.”

According to Reuters, Musharraf cited “Political injustices, poverty and illiteracy” as “fueling religious fundamentalism and terrorism,” while “urging rich countries to help Muslim nations with investment and socio-economic reforms.”

The article continued with: “Many people in the Islamic world ["feel deprived, hopeless, powerless"] and could be ["indoctrinated by distorted views of Islam,"] Musharraf said. ["Muslim states are seen as the source of terrorism,"] he said, warning of new ["depths of chaos and despair"] and more ["terrorism and an impending clash of civilizations"] if the West, particularly the United States, and Muslim countries failed to eradicate the root causes of anger and resentment.”

TIran Threatens U.S. - July 2, 2004
Iran has warned the U.S. that any attack on its interests will lead to a global retaliation.

According to News24.com: “Iran's supreme leader Ayatollah Ali Khamenei warned the United States on Monday that any attack on the Islamic republic's interests would be met with a global response. ["If the enemy attacks our scientific, natural, human or technological interests, the Iranian people will cut off its hand without hesitation and place in danger the interests of the aggressor everywhere in the world,"] he told a gathering in the western city of Hamedan.”

The remarks were timed to coincide with the end of a visit to Iran by Syrian president Assad. According to report in the Jerusalem Post: “Amid accusations by US and Iraqi leaders that Syria and Iran were behind political incitement and terrorist acts aimed at destabilizing the new Iraqi government, Syrian President Bashar al-Assad on Monday ended a two-day surprise visit to Iran. The tow countries have been united in their opposition to the presence of US troops in Iraq.”

The Post added that “Assad met with top officials including leader Ayatollah Ali Khamenei and President Mohammad Khatami. He was accompanied by Vice President Abdel Halim Khaddam, Foreign Minister Faruq al-Shara and other Syrian officials.”

Iranians Captured In Baghdad - July 2, 2004
According to Stratfor.com: “Two Iranians were captured in eastern Baghdad on Monday, reportedly while planting a bomb in a predominantly Shiite area. It is not clear that the Iranians were operating on behalf of Iranian intelligence or as volunteers working on their own initiative with Iraqi groups. However, their capture comes amid increased tensions between Iran and the United States over the future of Iraq, and it marks one of the few times that Iranian nationals have been captured while operating as guerrillas inside Iraq.”

Stratfor suggests that the capture may be a sign that Iran is “starting to roll out a campaign within Iraq that is designed to place increasing pressure on both the United States and the interim Iraqi government.”

More interesting, according to Stratfor is what this capture says about the relationship between the Iranians and the Iraqi Shiites. “From all appearances, Grand Ayatollah Ali al-Sistani seems not to want to break with the Americans. Rogue leader Muqtada al-Sadr is saying one thing one day and another the next, but his main path appears, at the moment, to be benign. On the surface, then, there is a significant divergence taking place between Iran and its Iraqi Shiite clients.”

Stratfor thinks that “If there were a serious break between the two, one of the things we might expect is sectarian violence within the Iraqi Shiite community as pro-Iranian factions -- lavishly funded by Iran -- vied for power with followers of mainstream Shiite leaders.”

The conclusion, from Stratfor is not very comforting, and has the potential to roil global financial markets if things continue to play out the way they seem to be heading. “The Iranians want to dominate Iraq; the Americans do not see any pressing need to give in to them on this any longer. The Iranians do not believe that the future Iraqi government will have benign intentions toward Iran, unless Tehran can shape and control it. The Americans do not believe that Iran will be content merely with having a buffer zone. Containing this crisis will not be easy. In the end, the United States seems to be groping its way back to the old balance-of-power model it had supported for a generation. As Iraq slowly recovers, the possibility that it eventually will again be a viable nation-state emerges. If that were to happen, the creation of a balance of power between Iran and Iraq would once again be possible. Of course, how this helps with the war against al Qaeda is unclear, as is the question of why Iraqi Shiites would buy into this model. There is no obvious way to get there from here. There is, however, a straight line to a very nasty crisis.”

The Inside Job - July 19, 2004
The New Fifth Column

According to UPI’s Arnaud de Borchgrave, the anti U.S, and U.K. feeling form Muslims inside the respective countries is significant, and at least based on opinion surveys is worth keeping an eye on. De Borchgrave, on 4-8 wrote: “The new Fifth Column syndrome indicates the enemy inside the gates has plenty of bedlamites rooting for him in other countries. In Pakistan, some 66 percent believe Osama bin Laden is a good guy. As for the world's biggest proliferators of nukes to America's enemies, he has close to a 100 percent approval rating. Recent opinion surveys among Britain's almost 2 million Muslims, mostly from South Asia, rang alarm bells in Whitehall and in the media. Eighty percent were against the invasion of Iraq, 13 percent said another September 11-style attack on America would be justified, and 50 percent said they would consider becoming a suicide bomber if forced to live like Palestinians. Some 200,000 openly sympathized with Osama bin Laden.”

And perhaps offering a window into the future of the European Union, de Borchgrave added: “Muslim sentiments are not much different in Continental Europe. Increasingly, Europeans are older and affluent and find themselves surrounded by immigrants who have little respect for local traditions. In the Netherlands, Muslims are a majority among children under 14 in the country's four largest cities. Rotterdam, a port city where half the people are of foreign origin, will soon unveil Europe's largest mosque. In Brussels, the capital of the European Union, Muhammad has been the name most frequently given for newborn baby boys. Osama is a close second.”

Iran Bankrolls And Supports Anti U.S. Operations In Iraq

Middle East Newsline reported two significant developments over the weekend. First, the intelligence and analysis web site confirmed that Iran’s involvement in Iraq goes beyond putting pressure on the Shiite clerics, and as others have reported, providing strategic and financial assistance to the Sadr uprising.

According to the report: “Iranian intelligence has been operating at least 18 covert centers in Iraq as well as targeting Shiites deemed as aligned with the United States in a nearly $1 billion effort to prevent the spread of democracy in that Arab country.”

Quoting “a former Iranian official in Teheran's intelligence community,” Middle East Newsline continued by saying that the official “ publicly disclosed the first details on Iran's intelligence presence in Iraq. The defector said Iran has bolstered its intelligence presence throughout Iraq where Teheran has sought to exacerbate ethnic tensions and encourage a nationwide revolt against the United States. The centers have been located in Baghdad, Basra, Karbala, Najaf, Nasseriya and Suleimaniya, the Iranian defector said. The centers, operating under the cover of charities, have also been used to recruit Iraqis to spy for Iran.

The defector, identified as Haj Saidi and who fled Iran in late 2003, told the London-based daily A-Sharq Al Awsat on April 3 that Iran has sent hundreds of intelligence agents into Iraq over the last 18 months. Many of them came under the guise of Iranian pilgrims and Iraqi refugees. He said more than 300 Iranian agents -- benefiting from about 2,700 safe houses in 14 cities -- were operating in Iraq.”

Syria Ships WMD To Sudan

Middle East Newsline also reported that Syria has shipped significant numbers of WMD, including chemical weapons to Sudan, using passenger airliners. The shipments, have reportedly been done with Syrian government approval, but have been made without the knowledge of the government of Sudan.

The smuggled cargo has been sent to Sudan as part of the two countries’ recently improved trading relationship, and includes “shipments of Scud C and Scud D extended-range missiles as well as WMD components to warehouses in Khartoum since at least January 2004.

["There is widespread concern in the Syrian regime that Damascus will be the next to face heavy U.S. and international pressure to open its WMD facilities in the wake of the Libyan example,"] a senior intelligence source said. ["The Syrians have decided that they want to take some of their assets out of the country."]

There is no mention in the report about whether the WMD have any connection to Saddam Hussein’s arsenal, which according to multiple unsubstantiated reports, was smuggled into Syria prior to the U.S. invasion of Iraq.

The August PDB

The August 6, 2001 Presidential Daily Briefing (PDB) was declassified by the White House, which spent a good deal of time downplaying its importance.

Quoting anonymous sources “who read the presidential memo,“ prior to the release, the Associated Press , reported that the presidential daily briefing, or PDB, delivered to Bush on Aug. 6, 2001 - a month before the Sept. 11 attacks - said there were various reports that Osama bin Laden had wanted to strike inside the United States as early as 1997 and continuing into the spring of 2001, the sources told The Associated Press. The wire service added that [“the same month as that briefing of Bush, U.S. intelligence officials received two uncorroborated reports suggesting terrorists might use airplanes, including one that suggested al-Qaida operatives were considering flying a plane into a U.S. embassy, current and former government officials said,”] and that [“those August 2001 reports - among thousands of varied and uncorroborated threats received by the government each month - weren't deemed credible enough to tell the president or his national security adviser, Condoleezza Rice, the officials said. Neither involved the eventual Sept. 11 plot.”]

The PDB became a hotly contested point during National Security Adviser Rice’s public testimony in front of the 9/11 commission. In our opinion, although Dr. Rice’s testimony was seen favorably by 50% of those polled by Rasmussen.com, little new light was shed on the subject. All evidence we have reviewed still points to the same conclusion: The United States, hampered by laws prohibiting the cooperation between domestic and international security agencies, and political squabbling during the Clinton administration and the Bush years, was never able to put together enough calm heads to sift through the evidence that might have led to better insight into the possibility of a dramatic attack by a terrorist organization.

Perhaps the key statement by Rice to the commission was this, as quoted by AP: “Rice stated emphatically on Thursday she did not see any such reports about al-Qaida using a plane as a weapon until after Sept. 11, suggesting the intelligence may have reached someone lower in the White House. ["To the best of my knowledge, Mr. Chairman, this kind of analysis about the use of airplanes as weapons actually was never briefed to us,"] she said. ["I cannot tell you that there might not have been a report here or a report there that reached somebody in our midst."]

Again, substantiating our conclusion, AP added, also over the weekend that “A person familiar with the session said Mr. Clinton told the commission he did not order retaliatory military strikes after the bombing of the USS Cole in October 2000 because he could not get ["a clear, firm judgment of responsibility"] from U.S. intelligence before he left office the following January. It wasn't until after the Bush administration took power that U.S. intelligence concluded al Qaeda had sponsored the attack on the ship in the harbor at Aden, Yemen. Some commissioners have been critical of the decision not to launch a retaliatory military strike.”

The report added that “Mr. Clinton ["did not indicate anything fundamentally that he would have done differently"] given what U.S. intelligence knew about Osama bin Laden and the al Qaeda threat.”

Conclusion: The Enemy Within

Today’s report clearly indicates that the Islamic militants have been planning to bring about the downfall of the United States, and the Western world for several years, and most likely several decades. The degree and sophistication of the entire operation, including the amazing attention to detail and the inclusion of multiple fronts of engagement, including Afghanistan, Europe, and the United States, shows that the situation is beyond serious, it is ubiquitous.

By carefully studying the weaknesses of its enemy, including the legal hurdles in the United States, such as the legislation that prevented the FBI and the CIA from communicating on high level, matters of national security, and by capitalizing on the secretive nature of the spy business, the perpetrators have shown a level of sophistication and cunning, that is only slowly being acknowledged, albeit begrudgingly in Washington.

The 9/11 commission, even with its increasingly apparent partisanship, is mostly responsible, and perhaps accidentally, for revealing, albeit only to those who read between the lines, that the enemy of Western life, as we know it, is as much without, as it is within.

It also points out one clear fact, that is only surmised by careful scrutiny and thought, the enemy is within the fabric of western society now, and perhaps even inside the governments.

Thus, the worried look, and the increasingly graying hair on President Bush’s head, along with the permanent scowl on National Security Advisor’s face, are in our opinion, only partially present due to the pressures of re-election.

To us, it seems, that well...they, perhaps more than any others before them, are coming to grips with the fact that they are up against a formidable, multiheaded foe, who has been plotting the end of western life as we have come to know it, for at least one or maybe more generations