Monday, November 23, 2009

Federalism in Nepal and Peter Galbraith

November 21, 2009
Mr Padma Jyoti
Member, Constituent Assembly
Dear Padma Jyotijee

Thanks for reverting back.

I am not against federalism per se. But, in my considered opinion, what is being imposed on Nepal – a tiny country – does not augur well. Fragmentation of Nepal into over 75 provinces in the name of ethnic federalism is a nightmare scenario. I hope you don’t mind my criticizing UCPNM in this respect, because that party has nominated you to CA. I have been openly critical of them and others who advocate ethnic federalism for Nepal. I have had debate even people like Dina Nath Sharma in a forum where I presented a paper on the subject. I am hoping to have an interaction on the matter with people like Prachanda and Dr Bhattarai.

I am sure that you would like to point out an error in my statement above about 75 provinces as parties like UCPNM are asking for only about 17 provinces. But with the formation of provinces for about 10 ethnic groups, other ethnic communities will definitely ask for level playing field and we will soon have actually more provinces, not less.

Being a student of law and due to my own interest I have studied quite a lot about these issues, including governance. There is no direct bearing of federal structure on governance issues. No one in the right mind will disagree that the weakness in the governance needs to be dealt with. But under federal structure, instead of one unitary country, we will end up with several provinces with weak governance.

Junior Galbraith is definitely dishonoring the good name his father had earned. But GREED has no barriers in terms of color, geography, religion, et al. I know of many a famous people, within and without Nepal, who give in to greed, knowingly or unknowingly. I know of many a rich people who, in their quest to hoard more, succumb to greed forgetting about human decency, what they owe to their motherland, that their own prestige may be at stake, including prior commitment they have made. I guess junior Galbraith is no different. My concern here is: whether and if we have our own Galbraiths (Nepali or expatriate) who are angling to profit by pushing this country into disintegration in the name of federalism.

I too am sad but for senior Galbraith. He must be turning in his grave! God bless him.

With best regards,
Ratna Sansar Shrestha
From: P Jyoti []
Sent: Friday, November 20, 2009 16:11
Subject: Re: Federalism

Dear Ratna Sansarji,

I enjoy and learn from your viewpoints and writings provoking a good debate, including one on Federalism recently. We need not be totally against federalism if it is well thought out and constructed to address the weakness of governance issues.

I did not know Peter Galbraith was the son of John Kenneth Galbraith whom I greatly admire for his wit and writings. He was one of the shining knights of the JFK Camelot years. If true, I am sad to read about Peter Galbraith's misuse of power for personal gain.

Best wishes,
Padma Jyoti

----- Original Message -----
From: Ratna Sansar Shrestha
To: "Undisclosed-Recipient:;"
Sent: Wednesday, 18 November, 2009 7:01 AM
Subject: Fw: Federalism

Dear Colleague

The attachment (copy pasted below) is very revealing in as much as why a foreigner wants to have a nation go federal. No wonder we have a multitude of INGOs (with our own version of Peter Galbraiths) advocating restructuring of Nepal on ethnic lines.

I trust we could learn a lesson or two from this.

With best regards,


Ratna Sansar Shrestha
Copy Paste of the attachment:
Peter Woodard Galbraith (born December 31, 1950) A.B., M.A., J.D., is a former United States diplomat. He is the son of John Kenneth Galbraith and Catherine (Kitty) Merriam Atwater. Peter Galbraith holds degrees from the Commonwealth School, Harvard College, Oxford University, and Georgetown University Law Center.

Galbraith was a professional staff member for the US Senate Committee on Foreign Relations from 1979 to 1993, where he published many reports about Iraq and took a special interest in Kurdistan. In 1987, he uncovered Saddam Hussein's systematic destruction of Kurdish villages and a year later wrote the "Prevention of Genocide Act of 1988" which would have imposed comprehensive sanctions on Iraq because of the gassing of the Kurds. The bill unanimously passed the Senate but was opposed by the Reagan Administration as "premature" and did not become law. In 1993, President Bill Clinton appointed Galbraith as the first United States Ambassador to Croatia. In 1995, he was the co-mediator and principal architect of the Erdut Agreement that ended the war in Croatia by providing for the peaceful reintegration of Serb-held Eastern Slavonia. From 2000 to 2001 he served with the United Nations in East Timor, where he was head of the UNTAET political section and Cabinet Member for Political Affairs and Timor Sea in East Timor's first Transitional Government. He was East Timor's lead negotiator for maritime boundaries with Australia and produced two agreements, including the 2002 Timor Sea Treaty, that effectively quadrupled East Timor's share of the petroleum resources between the two countries. He was also a Professor of National Security Strategy at the National War College, in 1999 and between 2001-2003.

Galbraith favors the independence, real or de facto, of Kurdistan - although it has recently been shown that Galbraith is standing to financially benefit from his stances. In 2003, he resigned from the U.S. government after 24 years of service in order to be able to criticize U.S. Iraq policy more freely. His 2006 book The End of Iraq: How American Incompetence Created a War Without End, advocates acceptance of a "partition" of Iraq into three parts (Kurdistan, Shiite, and Sunni) as part of a new U.S. "strategy based on the reality of Iraq" (pp. 4, 12, 222, 224). He argued that the U.S.'s "main error" in Iraq has been "wishful thinking." He has also written extensively on Iraq in the pages of the New York Review of Books. Norwegian financial newspaper Dagens Næringsliv reported on October 10, 2009 on Galbraith's secret ownership interest in Kurdish oil fields. Galbraith's company, Porcupine LP, had a "contractual relationship" with the Norwegian oil company DNO, which in turn has a 55% stake in the Kurdistan oil field Tawke. Reportedly, "his company was among those claiming to have been squeezed out of a small stake in the ... field ... when DNO ... renegotiated agreements with Kurdish authorities" in 2008. The Porcupine stake stemmed from Galbraith's involvement in DNO's initial entry into Kurdistan in 2003.

Galbraith is a senior diplomatic fellow at the Center for Arms Control and Non-Proliferation.

Removed from United Nations.
Galbraith was announced as the next United Nations' Deputy Special Representative for Afghanistan on March 25, 2009. He is considered a close ally of Richard Holbrooke, the U.S. Special Representative to Afghanistan. However, Galbraith abruptly left the country in mid September 2009 at the request of UN Special Representative to Afghanistan Kai Eide following a dispute over the handling of the reported fraud in the 2009 Afghan presidential election. On September 30, the UN announced that he had been removed from his position by Secretary-General Ban Ki-moon. In response to his firing, Galbraith told The Times, "I was not prepared to be complicit in a cover-up or in an effort to downplay the fraud that took place. I felt we had to face squarely the fraud that took place. Kai downplayed the fraud."

Galbraith Financial Benefit from his Support of Iraqi Kurdistan
In 2009 Galbraith was exposed for his stances on Iraqi matters that have recently been identified as steered by his personal financial investment in Iraqi Kurdistan's oil fields. According to an article by Reidar Visser, Galbraith influenced the development of Kurdish politics in a direction from he stood to benefit financially.

Personal Life
He and his wife, a Norwegian social anthropologist, Tone Bringa, have three children and a home in Townshend, Vermont. Two previous marriages ended in divorce.

Galbraith was also a good friend of the twice elected Prime Minister of Pakistan Benazir Bhutto, dating back to their student days at Harvard and Oxford Universities, and was instrumental in Bhutto's release from prison in Pakistan for a medical treatment abroad during the military dictatorship of General Muhammad Zia-ul-Haq.

It is widely known that the former US diplomat Peter Galbraith has been one of the most prominent figures in shaping the state structure of Iraq in the period after 2003, especially with his vocal advocacy of various forms of radical decentralisation and/or partition solutions for Iraq’s political problems that are reflected in his books and numerous articles in the New York Review of Books, especially in the period from 2004 to 2008. Until now, though, it has generally been assumed that Galbraith’s fervent pro-partition propaganda was rooted in an ideological belief in national self-determination and a principled view of radical federalism as the best option for Iraq’s Kurds. Many have highlighted Galbraith’s experience as a former US diplomat (especially in the Balkans in the 1990s) as key elements of his academic and policy-making credentials.

Today, however, it has emerged that the realities were probably rather different. For some time, Norway’s most respected financial newspaper, Dagens Næringsliv (DN), has been focusing on the operations of DNO, a small Norwegian private oil company in Kurdistan, especially reporting on unclear aspects concerning share ownership and its contractual partnerships related to the Tawke field in the Dahuk governorate. One particular goal has been to establish the identity of a hitherto unknown “third party” which participated with DNO in the initial production sharing agreement (PSA) for Tawke between 2004 and 2008, but was squeezed out when this deal was converted to a new contract in early 2008, prompting a huge financial claim of around 500 million US dollars against DNO which has yet to be settled. Today, DN claims to present proof that one of the two major “mystery stake-holders” involved in the claim was none other than Peter Galbraith, who allegedly held a five-percent share in the PSA for Tawke from June 2004 until 2008 through his Delaware-based company Porcupine. Galbraith’s partner was the Yemenite multi-millionaire Shahir Abd al-Haqq, whose identity was revealed by the same newspaper earlier this month. DN has published documents from Porcupine showing Galbraith’s personal signature, and today’s reports are complete with paparazzi photographs of Galbraith literally running away from reporters as they confront him in Bergen, where he is currently staying with his Norwegian wife. He refused to give any comment citing potential legal complications.

If proven correct, the implications of this revelation are so enormous that the story is almost unbelievable. As is well known, DNO has been criticised for the way its operations in the Kurdistan region interfere with Iraq’s constitutional process. To their credit, though, DNO are at the very least perfectly forthright about their mission in the area: They are a commercial enterprise set up to make a maximum profit in a high-risk area currently transitioning from conditions of war. Galbraith, however, was almost universally seen as “Ambassador Galbraith”, the statesmanlike former diplomat whose outspoken ideas about post-2003 Iraq were always believed to be rooted in idealism and never in anything else. Instead, it now emerges, he apparently wore several hats at the same time, and mixed his roles in ways that seem entirely incompatible with the capacity of an independent adviser on constitutional affairs.

It can be useful to briefly recapitulate the extent of Galbraith’s involvement in creating the institutions of government in the “new Iraq”. In fact, the best guide to this subject is Galbraith himself, who recounted his own role in the book The End of Iraq, published in 2006. It seems clear he got involved on the Kurdish side early on in 2003: “Two weeks after Saddam’s fall, I began discussions with the Kurdish leaders on the future of Kurdistan and what they could achieve in the new Iraqi constitution (italics added, p.159)”. Supposedly, according to a later book by Galbraith, he was at this point a consultant for ABC News! Later, he appears to have been a regular consultant for the Kurds. While his various books only make vague acknowledgement as far as payment is concerned (“for a few months at the end of 2003 and the beginning of 2004 I did some compensated work for Kurdish clients”, and in the second book from 2008 there is reference to unspecified “corporate clients with several of which I have an ongoing business relationship”), it seems pretty clear from the narrative in the book that at least some of this refers to consultancy work for the Kurdish political leaders in the period leading up to the drafting of the Transitional Administrative Law (TAL) which was adopted in March 2004.
It is Galbraith’s description of the period between 2003 and 2005 that provides the fullest account of his influence on Iraq’s current system of government. Two key principles of the 2005 constitution – the idea that residual powers belong to the provinces and not to the central government, as well as the supremacy accorded to local law over federal law – stand out in particular. In many centralised states (and indeed even in certain federations), powers not explicitly granted to the regions belong to the centre. In Iraq’s constitution of 2005 it is the other way around, and the list of central government powers is hilariously short when compared to other federations of the world. This, it seems, comes directly from Galbraith and his influences on the Kurdish leadership back in 2003 and 2004. According to Galbraith, “after I left Iraq in May 2003, I realised that the Kurdish leaders had a conceptual problem in planning for a federal Iraq. They were thinking in terms of devolution of power – meaning that Baghdad grants them rights. I urged that the equation be reversed. In a memo I sent Barham [Salih] and Nechirvan [Barzani] in August, I drew a distinction between the previous autonomy proposals and federalism: ‘Federalism is a “bottom-up” system. The basic organising unit of the country is the province or state. The state or province is constituted first and then delegates certain powers (of its choice) to the central government…In a federal system residual power lies with the federal unit (i.e. state or province); under an autonomy system it rests with the central government. The central government has no ability to revoke a federal status or power’…Finally I wrote …'any conflict between laws of Kurdistan and the laws or constitution of Iraq shall be decided in favour of the former' (160–61).”

Later, Galbraith urged the Kurds to be maximalist about their demands: “The Bush administration might not like the Kurds insisting on their rights, I said, but it would respect them for doing so (163)”. Then, leading up to the TAL negotiations in the winter of 2004, Galbraith worked specifically for the Kurds in framing their demands. It is very easy to see how the Kurdish gains in the TAL and not least in the 2005 constitution are based on this contribution from Galbraith. Galbraith writes, “On February 10 [2004], Nechirvan [Barzani] convened a meeting at the Kurdistan national assembly of the top leaders of the PUK and KDP. I presented a draft of a ‘Kurdistan chapter’ to be included in the interim constitution [i.e. the TAL]… Except for a few matters assigned to the federal government (notably foreign affairs), laws passed by the Kurdistan national assembly would be supreme within the region. The Kurdistan Regional Government could establish an armed force…The Kurdistan Region would own its land, water, minerals and oil. Kurdistan would manage future oil fields (and keep revenues) but the federal government in Baghdad would continue to manage all oil fields currently in commercial production. Because there were no commercial oil fields within Kurdistan as defined by the March 18, 2003 boundaries, this proposal had the effect of giving Kurdistan full control over its own oil…The permanent constitution of Iraq would apply in Kurdistan only if it were approved by a majority of Kurdistan’s voters (166–67).” Subsequent achievements noted by Galbraith as personal successes include staging the informal 2005 referendum on Kurdish independence (171).

The influence of Galbraith can be discerned already in the 2004 Transitional Administrative Law (where the principle of residual powers for the provincial entities was put in place), even if Galbraith was dissatisfied with the relatively long list of powers accorded to Baghdad and blamed the “centralising” policies of Paul Bremer and the Bush administration generally for this “defect”. But his hand is even more evident in the 2005 constitution, which combines residual powers for the regions with the supremacy of local law (albeit not if it contradicts the constitution, a “shortcoming” Galbraith later tried to gloss over), and which also specifically mentions the regional right to local armed forces. The narrative in Galbraith’s books turns somewhat weaker in this period, and it is less clear exactly how he continued to exercise influence – apparently less directly now, and more through the general advice on federalism given to the Kurds earlier. But at one revealing point in the book, he clearly cannot resist the urge to reveal just how influential he was until the very last minute of the constitutional process in 2005. On page 199, in a footnote, he writes, “A British treasury official serving as an advisor to his country’s embassy nearly derailed the constitution two hours before the final deadline. He was reading an English translation being made as drafts of the Arabic text became available, and realised the federal government had no tax power. He was about to charge into a meeting of Iraq’s political leaders when a quick-thinking Kurdish constitutional advisor grabbed an available Westerner – me – to explain the situation. The omission, I told him, was no mistake and he might want to consult with his ambassador before reopening an issue that could bring down Iraq’s delicate compromise”.

Almost drunk with success, it seems, and probably truly convinced that Iraq was heading for breakup, Galbraith could not disguise his satisfaction. Indeed, with the new information about his supposed economic interests, the way he engaged on specific issues relating to oil in the US public debate at this fateful point of transition seems utterly reckless. In August 2005, during the final negotiations, while he appeared to be satisfied with the way the new constitution developed as far as decentralisation was concerned, he did voice scepticism to growing Islamic influences in the new document and at one point considered the alternative of an overhaul of the TAL to make the regions stronger in that charter instead. He wrote again in the New York Review of Books, this time stressing how “the Kurdish leaders would accept its [i.e. the TAL's] continuation provided the text was clarified to assure Kurdistan's ownership of petroleum in the region and if the status of the disputed region of Kirkuk were resolved (italics added)”. He also expressed hope that “oil contracts made by the Kurdistan government” (one of the few at that time was of course Tawke, to which Galbraith now has been linked through the PSA) could be exempted from general federal control through separate bilateral agreements between Baghdad and Arbil.

As for the ramifications of these revelations, when they become known in Baghdad, it is really hard to predict. There has been a myriad of conspiracy theories concerning secret schemes to partition Iraq; while most of them are probably exaggerated the Tawke saga seems to be the most explicit intersection yet of international capitalism and advocacy of a divided Iraq, embodied in Peter Galbraith through his dual role as an alleged stake-holder in the Tawke oilfield and intellectual advocate of Kurdish secession from Iraq. While he was advising the Kurds on the principles of federalism and trying to persuade an American Democratic audience about the virtues of partition as an alternative to the Bush administration policies in Iraq, Galbraith supposedly held a 5 per cent stake in an oil field whose profit potential was directly governed by the constitutional and US policy decisions Galbraith was seeking to influence (his suggestions also included the idea of a permanent US airbase in Kurdistan).Under any circumstances, this new development is likely to strengthen the tendency among Iraqis to be more critical about the details of the 2005 constitution and not least the historical context in which it was conceived – a criticism that even Prime Minister Nuri al-Maliki articulated during the run-up to the last local elections. Seemingly, Maliki’s ideas of rectifying this towards greater centralism (i.e. removing some of Galbraith’s pet projects from 2005) have met with success among voters so far.

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