|PREDICTING VOLCKER. SAME TIME NEXT YEAR. BLAME ON
GOVERNMENTS. OIL FOR FOOD AGREEMENT TEXT AND MANAGEMENT MECHANISM.
1 September 2004
Was it President Truman who wanted to "cut the other hand" of every economist? Well, he didn't get to
Paul Volcker. Anyone who thinks U.N. diplomats made tentative presentations should have observed the
former U.S. Fed Chairman and U.S. banker "brief" the press on 7 August at the Beekman Hotel -- a
measured distance from the U.N.
The "report" he presented was a collection of correspondence between him, the Secretary General and
the Security Council. He explained it mainly covered "the process" (how revealing!). Substantive
findings or statements will have to wait for NEXT YEAR. And that would only cover "the U.N.'s
management" side. The entire investigation may take as long as FOUR YEARS. A complete investigation
"would last well into the next century." Volcker thus inadvertently proved a claim by the father of
modern capitalism William Maynard Keynes that in the long run we will all be dead!
The inquiry has collected some 10,000 boxes of U.N. documents and he is "making headway in terms of
cataloguing and prioritizing." He already has 50 staff on board with "60 expected" -- not clear
whether additional or total. Most investigators were Americans but he hoped to broaden the
representation. He needs initially $30 million with offices in Paris and Baghdad, in addition to
New York. It is not certain that the Assembly's Budgetary Committee will approve -- but Kofi Annan
"had promised all the support we need." Thus, delegates could be conveniently blamed if the money
and the "real" report were not forthcoming.
Volcker sensed good vibes from Baghdad's Interim Government. No, he had not seen Ahmet Chalabi's
"original" list nor did he have a complete picture as to what original documentation was available
in Baghdad. As there were several ongoing investigations, his inquiry will concentrate on "how the
U.N. administered the Oil for Food Program." He will make information available "when we can do it
without hurting the integrity of the investigation," and (rest assured!) not in a way to prejudice
individuals. Volcker was even more reassuring to the Secretary General who appointed him. After some
sort of "joke" about how the U.N. was "slow on its feet," he took pains to clarify that the U.N.
Secretariat had very little say in all what took place. The oversight of the Program was under the
Security Council, not the Secretariat, and U.N. agencies on the ground also did not answer to the
Secretariat, "so you've got to keep those distinctions in mind." (Kofi Annan should be smiling; he
is already off the hook.)
Answering N.Y. Times senior reporter Judity Miller, he explained he did not need subpoena
authority: governments were co-operating, most companies involved were not American (how did he
know?), and the press will hold non-co-operative countries feet to the fire. In response to
Claudia Rosette, he suggested that she should give any information she had about suspicious
financial links to the authorities. Rosette also asked about Kojo Annan, stressing Cotecna's central
role, but Volcker said one had to distinguish between contractors of the U.N. like Cotecna and
the bulk of the contractors in the Program who were not contractors with the U.N. but with the
Iraqi government. When she pressed again on Kojo, Volcker responded that "we'll look at whatever we
think is relevant." (Keep smiling, my friend.)
Volcker was introduced by Anna DiLello, his "communications director." His other colleagues Judge
Goldstone and Mr. Pieth shared the podium. They kept silent.