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The system did not fail

Posted by Richard Sunday, February 06, 2005

In the wake of the Volcker report on the UN oil-for-food scandal, The Sunday Telegraph has no less than three pieces today – a full page "focus" article (which does not appear to be available on-line), a news report and a typically robust comment piece from Mark Steyn.

The story is also covered in The Sunday Times, The Independent on Sunday and The Observer, making it a clean sweep, as far as the "quality" Sundays go.

Turning to the Telegraph "focus" piece first, it is headed: "The scandal that Kofi couldn’t cover up", which just about says it all. No one who has followed this issue has any doubts that, if the UN SecGen could have got away without opening it up to public scrutiny, he would have done so.

The strap line reads: "Evidence of double-dealing in the Iraq oil-for-food programme is stacking up by the week as more and more of the United Nations officials are being implicated", and the article relies in part on a long quote from Nile Gardiner of the Heritage Foundation. His view is:

The UN continues to display breathtaking arrogance with regard to the oil-for-food scandal. The organisation does not seem to recognise the extent to which it has been damaged by this. Five major congressional investigations are looking at the role of Kofi Annan and any of them have the potential to force his resignation.
As if to affirm the UN's arrogance, The Observer weighs in with an incredibly self-regarding piece by Peter Beaumont headed: "The defiant UN starts fightback", clearly aimed at downplaying the whole affair.

Volcker's report, Beaumont writes, does not reveal any systematic corruption. He then suggests that, "It is a sign of the frustration of the UN's right-wing critics that their best response to the investigation is to suggest that, as a supporter of the UN's humanitarian goals through America's UN Association, Volcker is tarnished."

Totally out on his own, Beaumont then argues that, "the ongoing UN investigation - despite five separate congressional probes - seems to have given it a bullish new confidence." He has been talking to Mark Malloch Brown, Annan's new British chief of staff, and from him he "sensed a new sense of resolve that the UN was ready to take the fight back to its detractors."

Discerning something no one else seems to have noticed, he claims that "there is a wider sense in the UN that perhaps the moment of danger from right-wing ideologues in the US who would destroy it has passed … And now, believes Annan, the opportunity is ripe to win back the middle ground of US opinion it feared had turned against it."

Not even the Independent, however, supports this thesis. Its piece is headed: "Annan under fire from UN's former chief", reporting that the SecGen's attempt to deflect criticism over corruption is "undermined by his predecessor."

Former SecGen Boutros Boutros-Ghali, who was ousted after one term as UN chief because of US opposition to him, said he and Mr Annan were both responsible for the "oil-for-food" programme. "I share the responsibility, but don't twist the whole operation," Mr Boutros-Ghali told BBC radio. "I regret the mismanagement and the scandal... [but] the basis [of the programme] was decided by the Security Council, approved by the Security Council and the execution was done during the mandate of my successor."

Significantly, the report concludes, the harshest words were from Congressional members well known for their long-held distaste of the UN. They included Senator Norm Coleman, who even before the report's release was calling for Mr Annan's resignation, and Henry Hyde, a Republican member of the House of Representatives. "I am reluctant to conclude that the UN is damaged beyond repair, but these revelations certainly point in that direction," Mr Hyde said after seeing Volcker’s report.

This is a theme shared by the Sunday Times, which headlines, "Report 'too soft' on Annan", stating that critics of the UN have accused Annan "of shirking responsibility for the gross mismanagement and corruption". They claim that Volcker's panel has been "too soft on the failings of the secretary-general".

Interestingly, and perhaps fatal for Annan, the Sunday Times also reports that the post-war Iraqi government now intends to take legal action against the UN to recover money made illicitly from the oil-for-food programme. Claude Hankes- Drielsma, an adviser to the government, said Annan had to shoulder the blame: "The secretary-general has to be ultimately responsible for the integrity of the organisation. There is significant evidence that he was aware of at least some of the issues but did nothing," he said.

The last words, however, must go to Mark Steyn in The Telegraph, with his piece headed: "Would you trust these men with $64bn of your cash? Of course not". What happened, he writes, was utterly predictable.

If I had $64 billion of my own money, I'd look after it carefully. But give someone $64 billion of other people's money to "process" and it would be surprising if some of it didn't get peeled off en route. Especially if that $64 billion gives you access to a unique supply of specially low-priced oil you can re-sell at market prices.

Hire Third World bureaucrats to supervise the "processing" and you can kiss even more of it goodbye. Grant Saddam Hussein the right of approval over the bank that will run the scheme, and it's clear to all that nit-picky book-keeping will not be an overburdensome problem.
In other words, Steyn concludes, the system didn't fail. "This is the trans-national system, working as it usually works, just a little more so." He goes on:

One of the reasons I'm in favour of small government is because big government tends to be remote government, and remote government is unaccountable, and, as a wannabe world government, the UN is the remotest and most unaccountable of all. If the sentimental utopian blather ever came true and we wound up with one "world government", from an accounting department point of view, the model will be Nigeria rather than New Hampshire.
That is actually the lesson behind the oil-in-food scandal which we have been at pains to highlight. Transnational government is, by its very nature, unaccountable, whether it is the UN or the European Union. It is not the "system" at fault, as such – these organisations are by their very nature prone to corruption and mismanagement and the only remedy is to get rid of them.

Thus Steyn concludes, "the best alternative to the trans-national jet-set is nothing – or at least nothing formal," a sentiment with which we entirely agree. Like us, Steyn also sees the parallel with the tsunami relief effort:

The Americans and Australians had troops and relief supplies on the ground within hours and were coordinating their efforts without any global bureaucracy at all. Imagine that: an unprecedented disaster, and yet robust, efficient, compatible, results-oriented nations managed to accomplish more than the international system specifically set up to manage such events. Would it have helped to elect a steering committee with Sudan and Zimbabwe on it? Of course not."
The UN he wants to sink into irrelevance. Yes, and let it take the other tranzies with it.

Incidentally, if you want to know how the "oil voucher" system – at the heart of the corruption – actually worked, the details are on the Middle East Media Monitoring Research Institute (MEMRI) website.