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Context of 'March 17, 2003: Neoconservative Foreign Policy Adviser Accused of Conflicts of Interest, War Profiteering'

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David Kimche.David Kimche. [Source: Mark Leighton / Bettmann / Corbis]David Kimche, the director general of Israel’s Foreign Ministry, meets secretly with National Security Adviser Robert McFarlane to advise him that Israel may be able to use its influence with Iran (see 1981) to engineer the release of American hostages currently held by Hezbollah. Kimche’s outreach is the final piece in the complex arms-for-hostage deal between the US, Israel, and Iran. [New Yorker, 11/2/1992] Israel is a logical conduit for arms to Iran, as it has been selling arms to Iran periodically since 1979, originally as part of its efforts to get Iran to allow Iranian Jews to emigrate to Israel. Like the US, Israel hopes to gain influence with Iranian moderates who will presumably take power after the aged, ailing Islamist radical Ayatollah Ruhollah Khomeini dies. (Earlier attempts to sell US-made arms to Iran had been blocked by the Carter administration.) According to Israeli sources, this Israeli offer began with a group of Israeli businessmen informing Prime Minister Shimon Peres in early July that they had been in contact with Iranian officials, and thought they could facilitate an arrangement to swap US arms for American hostages. The Israelis say that the US point man for the deal is John Poindexter, the deputy national security adviser, and Poindexter tapped National Security Council aide Oliver North to be the US liaison to Israel. Peres quickly authorized the Israeli businessmen to resume their contacts with the Iranians, and the businessmen contacted Saudi arms merchant Adnan Khashoggi. Khashoggi obtained a long list of desired military equipment from the Iranians, including Hawk antiaircraft missiles and radar-guidance equipment for them, antitank missiles, and spare parts for jet fighters. [Time, 11/17/1986]

Entity Tags: Oliver North, Carter administration, Adnan Khashoggi, David Kimche, John Poindexter, Robert C. McFarlane, Shimon Peres, Hezbollah

Timeline Tags: US confrontation with Iran, Iran-Contra Affair

Laurent Murawiec.Laurent Murawiec. [Source: Hudson Institute]A briefing given to a top Pentagon advisory group by RAND Corp. analyst Laurent Murawiec states: “The Saudis are active at every level of the terror chain, from planners to financiers, from cadre to foot-soldier, from ideologist to cheerleader.… Saudi Arabia supports our enemies and attacks our allies.” Saudi Arabia is called “the kernel of evil, the prime mover, the most dangerous opponent.” This position still runs counter to official US policy, but the Washington Post says it “represents a point of view that has growing currency within the Bush administration.” The briefing suggests that the Saudis be given an ultimatum to stop backing terrorism or face seizure of their oil fields and financial assets invested in the United States. The advisory group, the Defense Policy Board, is headed by Richard Perle. [Washington Post, 8/6/2002] An international controversy follows the public reports of the briefing in August 2002 (for instance, [Scotsman, 8/12/2002] ). In an abrupt change, the media starts calling the Saudis enemies, not allies, of the US. Slate reports details of the briefing the Post failed to mention. The briefing states, “There is an ‘Arabia,’ but it needs not be ‘Saudi.’” The conclusion of the briefing: “Grand strategy for the Middle East: Iraq is the tactical pivot. Saudi Arabia the strategic pivot. Egypt the prize.” [Slate, 8/7/2002] Note that a similar meeting of the Defense Policy Board appears to have preceded and affected the United States’ decision to take a warlike stance against Iraq (see September 19-20, 2001). Murawiec is later identified as a former editor of the Executive Intelligence Review, a magazine controlled by Lyndon LaRouche, an infamous far-right conspiracy theorist and convicted felon. Perle invited Murawiec to make his presentation. [New Yorker, 3/17/2003]

Entity Tags: Saudi Arabia, Richard Perle, Lyndon LaRouche, Laurent Murawiec, RAND Corporation, Defense Policy Board, Bush administration (43), Executive Intelligence Review

Timeline Tags: Complete 911 Timeline

Neoconservative and Defense Policy Board (DPB) member Richard Perle calls journalist Seymour Hersh a “terrorist” to a CNN audience. Hersh has published an article speculating that Perle’s investments in firms providing homeland security services put him in the position of profiting off of an invasion of Iraq, and subject to conflict of interest charges (see March 17, 2003). Perle retorts that Hersh is “the closest thing American journalism has to a terrorist.” Host Wolf Blitzer twice asks Perle why he calls Hersh a terrorist, giving Perle the chance to call Hersh “widely irresponsible” and say, “[T]he suggestion that my views are somehow related for the potential for investments in homeland defense is complete nonsense.” Perle continues, “[Hersh] sets out to do damage and he will do it by whatever innuendo, whatever distortion he can…” Blitzer concludes the interview by saying: “All right. We’re going to leave it right there.” [CNN, 3/9/2003; Unger, 2007, pp. 256] Later in the month, Perle will resign from the DPB over his conflicts of interest as detailed by Hersh (see March 27, 2003).

Entity Tags: Seymour Hersh, Richard Perle, Wolf Blitzer

Timeline Tags: Neoconservative Influence

An outraged Richard Perle, the neoconservative chairman of the Pentagon’s Defense Policy Board (DPB), says he is suing journalist Seymour Hersh over an article Hersh wrote that implied Perle is using his position as a Pentagon adviser to profit from a US invasion of Iraq (see March 17, 2003).
Filing Planned for Britain - Interestingly, Perle plans to sue Hersh in British courts, not US courts, because the burden of proof on plaintiffs is far less in Britain than America. “I intend to launch legal action in the United Kingdom. I’m talking to Queen’s Counsel right now,” Perle says. Perle says of Hersh’s article, “It’s all lies, from beginning to end.”
Perle Defended - Stephen Bryen, a former deputy undersecretary of defense, defends Perle, saying: “It’s pretty outrageous for a leftwing columnist to make accusations like this with no factual basis. Most of the many hours he works each day are pro bono to help the administration with its policy on Iraq. He should get a medal of honor.”
Editor Defends Hersh - David Remnick, the editor of the New Yorker, the publisher of Hersh’s article, says his magazine stands by the story. “It went through serious reporting, with four members of the board talking to Sy [Hersh], and rigorous factchecking, legal-checking, and all the rest.” Remnick takes issue with Perle’s recent characterization of Hersh as a “terrorist” (see March 9, 2003), saying, “I would have thought after all this many years, Mr. Perle would be a bit more refined than that.” [New York Sun, 3/12/2003]
Journalists Defend Hersh - Many journalists defend Hersh, with one, Slate’s Jack Shafer, calling Perle a “grandstanding pantywaist,” “double-dar[ing]” him to sue Hersh, and accusing Perle of “venue-shopping” by planning to file the lawsuit in Britain. “As a public figure and government official,” Shafer explains, “Perle would be laughed out of court in the United States. If he got a settlement in the UK, he could raid the substantial British assets of the New Yorker’s parent company, Conde Nast.” [Slate, 3/13/2003]
Perle Resigns, Does Not File Lawsuit - Later in the month, Perle will resign from the DPB over his conflicts of interest (see March 27, 2003). A year later, after much blustering in the media and promises of “dossiers” and “revelations” about Hersh, Perle will decide not to sue Hersh after all, saying he cannot meet the burden of proof that a court would impose. [New York Sun, 3/12/2004] Months later, the dossiers and information Perle promised to release about Hersh remain unrevealed. [Slate, 6/17/2004]

Entity Tags: Defense Policy Board, Richard Perle, Jack Shafer, Stephen Bryen, David Remnick, Seymour Hersh

Timeline Tags: Neoconservative Influence

Investigative reporter Seymour Hersh publishes a scathing portrayal of Defense Policy Board (DPB) chairman Richard Perle, who Hersh alleges is using his position in the Pentagon to profiteer on the upcoming Iraq war. Hersh does not accuse Perle of breaking any laws, but he does show that Perle is guilty of conflicts of interests. The article, which is released days before its official March 17 publication date, prompts outrage from Perle and his neoconservative defenders, with Perle saying any questions of his potential conflicts of interest would be “malicious,” calling Hersh a “terrorist” (see March 9, 2003), and threatening to sue Hersh, a lawsuit that is never filed (see March 12, 2003). Later in the month, Perle will resign from the DPB over his conflicts of interest as detailed by Hersh (see March 27, 2003).
Dealings with Corrupt Saudis in Violation of Federal Conduct Guidelines - Hersh provides readers with details of Perle’s business dealings with the notoriously corrupt Saudi businessman and arms dealer Adnan Khashoggi (perhaps most famous in the US for his involvement in Iran-Contra—see July 3, 1985) and his activities as a managing partner of the venture capital firm Trireme Partners LP. Trireme is involved in investments that will make large profits if the US actually invades Iraq. Perle, as chairman of the DPB, is subject to the Federal Code of Conduct that bars officials such as himself from participating in an official capacity in any matter in which he has a financial interest. A former government attorney who helped write the code says, “One of the general rules is that you don’t take advantage of your federal position to help yourself financially in any way.” The point is to “protect government processes from actual or apparent conflicts.”
'Off the Ethical Charts' - One DPB member says that he and his fellows had no idea about Perle’s involvement with either Trireme or Khashoggi, and exclaims: “Oh, get out of here. He’s the chairman!… Seems to me this is at the edge of or off the ethical charts. I think it would stink to high heaven.” The DPB member is equally disturbed that fellow board member Gerald Hillman, Perle’s partner in Trireme, was recently added to the board at Perle’s request. Hillman has virtually no senior policy or military experience in government before joining the board. Larry Noble, the executive director of the Washington-based Center for Responsive Politics, says of Perle’s Trireme involvement: “It’s not illegal, but it presents an appearance of a conflict. It’s enough to raise questions about the advice he’s giving to the Pentagon and why people in business are dealing with him.… The question is whether he’s trading off his advisory-committee relationship.”
Lining up Investors, Overthrowing Saddam - According to Khashoggi, Perle met with him in January 2003 to solicit his assistance in lining up wealthy Saudi investors for Trireme. “I was the intermediary,” Khashoggi says. Together with Saudi businessman Harb Zuhair, Perle hoped to put together a consortium of investors that would sink $100 million into his firm. “It was normal for us to see Perle,” Khashoggi says. “We in the Middle East are accustomed to politicians who use their offices for whatever business they want.” But Khashoggi says Perle wanted more than just money—he wanted to use his position in both Trireme and the DPB to, in Perle’s words, “get rid of Saddam” Hussein. Perle admits to meeting with Khashoggi and Zuhair, but says that money never came up in conversation, and as for Hussein, Perle says he was at the meeting to facilitate a surrender bargain between Hussein and the US.
Khashoggi Amused - Khashoggi is amused by Perle’s denials. “If there is no war, why is there a need for security? If there is a war, of course, billions of dollars will have to be spent.… You Americans blind yourself with your high integrity and your democratic morality against peddling influence, but they were peddling influence.” Hillman sent Zuhair several documents proposing a possible surrender, but Zuhair found them “absurd,” and Khashoggi describes them as silly. (Hillman says he drafted the peace proposals with the assistance of his daughter, a college student.) Perle denies any involvement in the proposals. When the proposals found their way into the Arabic press, Perle, not Hillman, was named as the author.
Blackmailing the Saudis? - Prince Bandar bin Sultan, the influential Saudi ambassador to the US and a close friend of the Bush family, says he was told that the meeting between Perle and the Saudi businessmen was purely business, but he does not believe the disclaimers. He says of Perle, who publicly is a vociferous critic of Saudi Arabia (see July 10, 2002): “There is a split personality to Perle. Here he is, on the one hand, trying to make a hundred-million-dollar deal, and, on the other hand, there were elements of the appearance of blackmail—‘If we get in business, he’ll back off on Saudi Arabia’—as I have been informed by participants in the meeting.” Iraq was never a serious topic of discussion, Bandar says: “There has to be deniability, and a cover story—a possible peace initiative in Iraq—is needed. I believe the Iraqi events are irrelevant. A business meeting took place.” [New Yorker, 3/17/2003]

Entity Tags: Larry Noble, Defense Policy Board, Richard Perle, Seymour Hersh, Trireme Partners LP, Center for Responsive Politics, Harb Zuhair, Adnan Khashoggi, Bandar bin Sultan, Gerald Hillman

Timeline Tags: Neoconservative Influence

Embroiled in controversy over multiple conflicts of interests, Richard Perle resigns his position as chairman of the Defense Advisory Panel (DAP). [CNN, 3/28/2003] His resignation is the result of criticism of his mix of business activities as an investor, consultant, lobbyist, and political advocacy as an adviser to Secretary of Defense Donald Rumsfeld. In the weeks prior to his resignation, the New Yorker revealed that Perle’s venture capital firm, Trireme Partners LP, solicited funds from Saudi financiers, despite Perle’s vociferous criticisms of the Saudi government (see March 17, 2003). (Perle had notably invited a RAND Corp. analyst to give the DAP a briefing advocating the overthrow of the Saudi regime.) In the New Yorker article, the Saudi ambassador to the United States, Prince Bandar, said, “Here he is, on the one hand, trying to make a hundred-million-dollar deal, and, on the other hand, there were elements of the appearance of blackmail—‘If we get in business, he’ll back off on Saudi Arabia’—as I have been informed by participants in the meeting.” [New Yorker, 3/17/2003; Washington Report on Middle East Affairs, 5/2003; Washington Post, 7/24/2004]

Entity Tags: Defense Policy Board, Richard Perle, Bandar bin Sultan, Trireme Partners LP

Timeline Tags: Neoconservative Influence

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