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Baker Key to Dubai Ports Mess

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  • Tammy Ballard
    Baker Key to Dubai Ports Mess by Anacher Forester Thu Feb 23, 2006 at 12:09:34 PM PDT Former Reagan Chief-of-Staff, ex-Treasury Secretary, ex-Secretary of
    Message 1 of 1 , Mar 1, 2006
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      Baker Key to Dubai Ports Mess
      by Anacher Forester
      Thu Feb 23, 2006 at 12:09:34 PM PDT
      Former Reagan Chief-of-Staff, ex-Treasury Secretary,
      ex-Secretary of State, ex-NSC Council Member, ex-GWB
      chief legal advisor, etc, and recent US Special Envoy
      for Iraq debt is the invisible man in the middle of
      this mess.

      James A. Baker is Senior Partner of Baker Botts, a
      legal firm very active in Middle East affairs perhaps
      never more visibly than as legal representation for
      the Saudi Royal family in the lawsuits brought by the
      families of 9/11 victims. Baker Botts happens to
      include Halliburton among its many clients and is
      active in Egypt, Kuwait and Dubai, too.

      More below the fold

      Anacher Forester's diary :: ::
      According to Baker Botts, on April 15, 2005: "the firm
      expanded its presence in the region by opening a
      Middle East regional office in Dubai to complement our
      existing office in Riyadh, Saudi Arabia." Why? "Baker
      Botts' Dubai office provides service to clients in a
      number of sectors in the energy industry, including
      oil and gas exploration and development, oil field
      services, electric power, LNG, petrochemicals,
      pipelines, and gas-to-liquids." I bet they do. Clearly
      Baker Botts has a vested interest in the Bush
      Administration's push toward a "free" trade agreement
      with the UAE. I'll return to the Dubai office later.

      We've only just glimpsed the tip of the proverbial
      Bakerberg. James A. Baker also serves as Senior
      Counsel to the secretive Carlyle Group where The
      Guardian has reported his equity stake at an estimated
      $180 million US. The Carlyle Group has made hundreds
      of millions of dollars in the "war on terror" as owner
      or part owner of defense contractors: The
      Aerostructures Corporation, Combined Tactical Systems,
      Inc., DHS Technologies, Landmark Aviation, Stellex
      Aerostructures, Inc., Vought Aircraft Industries,
      Inc., Canada's Standard Aero Holdings, Inc., Italy's
      Avio SpA, US/Brit split Firth Rixson Limited and
      Britain's NP Aerospace & recently privatized QinetiQ.
      Due to increased scrutiny of their war profiteering
      (brought on primarily due to Baker's role as Iraq debt
      envoy), Carlyle has within the past two years "exited"
      their long-time investments in United Defense (CG's
      very first defense contractor acquisition in 1997) as
      well as United States Marine Repair, Aviall and Indigo

      The Carlyle Group's sway over US policies both foreign
      and domestic doesn't end with the military-industrial
      complex. They have their grubby fingers in a whole
      lotta pies. A good primer on Carlyle including how
      they gave GWB a job in 1991 and how they influence
      U.S.-Korean policy can be found here: Carlyle's Way.
      Suffice to say that when Baker and Daddy both say
      "frog", W jumps.

      On December 12, 2003 President Bush called on Russia,
      Germany, and France to forgive Iraq's debts.
      Embarrassingly this was just a day after the Pentagon
      announced The White House-approved policy excluding
      those nations from bidding for Iraqi reconstruction
      projects. A secretive "committee of officials" agreed
      that the most lucrative contracts must be reserved for
      political or military supporters such as Baker Botts
      client Halliburton and those within the Carlyle Group

      Shortly thereafter Baker acted as US Special Envoy for
      Iraq debt toured debtor countries eventually winning
      agreements from Great Britain, Germany, France, etc.
      to forgive billions of dollars. At the same time, Iraq
      has paid out to Kuwait a staggering $1.8 billion in
      reparations--substantially more than the battered
      country's 2004 health and education budgets combined,
      and more than the United States has so far managed to
      spend in Iraq on reconstruction. Hmm, how could that
      happen? One word: Baker.

      via The Nation: James Baker's Double Life (a must-read
      if you haven't already):
      "Carlyle has sought to secure an extraordinary $1
      billion investment from the Kuwaiti government, with
      Baker's influence as debt envoy being used as a
      crucial lever. The secret deal involves a complex
      transaction to transfer ownership of as much as $57
      billion in unpaid Iraqi debts. The debts, now owed to
      the government of Kuwait, would be assigned to a
      foundation created and controlled by a consortium in
      which the key players are the Carlyle Group, the
      Albright Group (headed by another former Secretary of
      State, Madeleine Albright) and several other
      well-connected firms. Under the deal, the government
      of Kuwait would also give the consortium $2 billion up
      front to invest in a private equity fund devised by
      the consortium, with half of it going to Carlyle.
      ...The consortium's proposal spells out the threat:
      Not only is Kuwait unlikely to see any of its $30
      billion from Iraq in sovereign debt, but the $27
      billion in war reparations that Iraq owes to Kuwait
      from Saddam Hussein's 1990 invasion 'may well be a
      casualty of this U.S. [debt relief] effort.'"

      Brandishing a mighty "lever" indeed in Baker as envoy,
      this deal is structured so that Baker & co. get $1
      billion up front regardless of the outcome. Nice work
      if you can get it. It's worth noting also that while
      the Europeans have been extremely generous in this
      debt forgiveness process (up to .90 on the dollar),
      there is precious little info on how much, if any,
      Iraq debt the U.S. has forgiven. It is crystal clear
      that the Bush administration does not hold the US or
      their Arab economic allies to the same standards that
      they do the rest of the world including our #1
      military ally, Great Britain.

      Back to Dubai...Carlyle bought CSX World Terminals in
      2003 for $300 million and just two year's later
      flipped it to the company now known as Dubai Ports
      World for a near 400% profit at a cool $1.12 billion.
      Again nice work, and a sweet price. Especially since
      John Snow had all but ran CSX into the ground. Since
      1991 CSX's profits have shrunk drastically with its
      stock underperforming its rivals' by more than 65%.

      CFIUS Chair John Snow was head of CSX for some 20
      years before "retiring" from his post to become
      Treasury Secretary. Under Snow's leadership, CSX paid
      no federal income taxes in three of the past four
      years. He also presided over the CSX sale to Baker's
      Carlyle Group. In addition to the many extravagant
      perks of his contract (including a $2.47 million
      lifetime yearly pension), Snow will score $33 million+
      more due to a clause triggered upon the transfer of
      CSX to D P World (or any other buyer for that matter).

      The crony circle closes even tighter with the
      nomination of DP former Head of European and Latin
      American Operations, David Sanborn, who has been
      handpicked by President Bush as his nominee for the
      Administrator of the Maritime Administration. Sanborn
      is a graduate of The United States Merchant Maritime
      Academy. According to DP World, he "previously held
      senior roles with shipping lines CMA-CGM (Americas),
      APL Ltd and Sea-Land and has been based, besides the
      US, in Brazil, Europe, Hong Kong and Dubai during his
      career. He has also served in the US Naval Reserve.
      Sanborn was hired by DP in 2005." That one year with
      Dubai Ports was all he needed to broker the Dubai
      Ports deal to purchase CSX. Sanborn left that post to
      oversee our ports (subject to Congressional approval)
      three weeks before the D P World deal is approved by
      the secretive John Snow-chaired Committee on Foreign
      Investment in the United States. I'm sure Mr. Sanborn
      is a very capable executive but somehow his past year
      spent flitting around makes me more anxious rather
      than more comfortable.

      Those are the facts as I see 'em. They have left me
      pondering two things:

      1. Carlyle bought CSX World Terminals for $300 million
      in 2003 and sold it to UAE/DP World just two years
      later for $1.12 billion. By all accounts, CSX is a
      financial mess. If I read it correctly its 2003 net
      profit was down 42% to $246,000 which is not even half
      the salary of their #5 executive
      (yahoo.com: CSX annual). Obviously, UAE/DP World
      massively overpaid for CSX. What exactly were they
      buying? Baker's and others' influence on behalf of the
      proposed free" trade agreement with Dubai? An eventual
      entree into the management of US ports? And/or
      something else?

      2. Putting aside the various documented 9/11, bin
      Laden & other UAE terrorism connections and their I
      remain greatly concerned that the UAE
      Government-controlled Dubai Ports World would have any
      influence at all on managing our country's major
      ports. It has everything to do with the UAE as a
      unparalleled hub of criminal activity yet nothing to
      do with its Arab ethnicity.

      By all accounts UAE is a fine place to live or to
      visit or what have you. It sure looked snazzy when I
      saw it on PBS' Globetrekker program. Bu it is also
      historically and currently the worldwide
      money-laundering capital -- it wouldn't be a surprise
      if any or all of the "missing" $9 billion+ from Iraq
      passed through Dubai. It has the most lax financial
      regulations going. Hell, until 2004 at the strong
      urging of the US government, Dubai's stock exchange
      had no written instructions whatsoever concerning
      money laundering.

      Additionally, Dubai is historically and currently not
      only a major worldwide transshipment portal for
      illegal drugs (mostly heroin), but also the sale of
      nuclear technologies (even prior to Bush prezzy debate
      fave Pakistan's "the A Q Khan"'s use of Dubai as a
      conduit to fulfill the nuke ambitions of Iran, North
      Korea and Libya), and prostitution, too. The $20
      billion+ 1991 Bank of Credit and Commerce
      International collapse and subsequent scandal managed
      to combine money-laundering, drug smuggling, child &
      adult prostitution, the sale of nuclear technologies,
      terrorism, arms trafficking, the Mujahideen, bribery,
      training of Medellin Cartel death squads, etc.,
      (Kerry/Brown BCCI Report. pt. 4) all with the active
      participation of the UAE's emir of Abu Dhabi and quite
      likely the CIA. BCCI was the world's worst ever
      financial scandal (see: wikipedia BCCI).

      Even if the government of the UAE no longer actively
      participates in the wide variety of major crimes still
      committed via their ports and through their banking
      system, they don't seem to be terribly committed to
      preventing them. Since the UAE fails to stop such
      illegal activities in their backyard and they continue
      to show at best a luke-warm interest in enforcement,
      why should we believe that the UAE would in any way
      serve as a deterrent in preventing them from reaching
      us in some catastrophic way here? If in fact the UAE
      government continues to actively participate in these
      illegal activities, we're really fucked. If the
      integrity of one various individual government
      departments involved in either DP World or UAE
      security is compromised, we're well fucked. This is
      where the threat to our National security lies not
      with the ethnicity of the principals involved given
      that our ports are the exhaustively well-documented
      weakest link in the brittle chain that is Homeland

      I'll leave it to the conspiracy theorists to speculate
      as to what the level of White House Chief of Staff
      (1981-1985)/Treasury Secretary (1985-1989)/Secretary
      of State (1989-1992) James A. Baker's involvement in
      and/or knowledge of BCCI's shenanigans. Nor will I
      postulate as to what dubious Dubai dealings former CIA
      Director/Vice President/President Poppa Bush may have
      had from 1976-1991 and beyond.

      Regardless, it did occur to me that Baker Botts had a
      slew of choices (i.e. Cairo, Damascus, Amman, Kuwait
      City, etc.) as to where to open a second Middle East
      office to "complement" the Riyadh office. Instead they
      chose the money laundering/drug smuggling/prostitution
      capital of Dubai. Note that Dubai is one of the
      closest major non-Iraqi/non-Saudi cities to Riyadh and
      at just 537 miles distant is less than a two-hour
      flight away. Yep, Dubai. Not Cairo where Baker Botts
      has considerable business and a location would give
      them ideal regional coverage. Not Kuwait City where
      they could keep a close eye on any developments in
      Baker's $1 billion+ Carlyle Group deal. Dubai. I have
      no idea how much of Baker Botts decision to open an
      office in Dubai has to do with D P World, "free"
      trade, Dubai's struggling stock market, etc. I do know
      that there has to be a whole lot more money coming
      down that UAE pipeline to Baker & Friends for the
      foreseeable future.

      There's much more here than meets the eye and most of
      it leads back to the Baker man.

      Tags: Dubai, Homeland Security, Carlyle Group (all


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