Yesterday, before the House International Relations Committee, Treasury Secretary Paul O’Neill reiterated the Bush administration’s opposition to US capital market sanctions against oil companies complicit in the genocidal destruction of the people of southern Sudan. He could do no better by way of explaining this opposition than other Administration officials: “No one finds the events in Sudan more reprehensible than we do. The reason I don’t think (the legislation) is a good idea is that it sets a precedent.” Ludicrously, he went on to suggest that: “A better way to deal with Sudan is to say no one should do any business with Sudan, full stop” (Dow Jones Newswires, June 27, 2002). And if we just “say” no one “should” do business with Sudan, is there anyone on this planet who really believes that such simple utterance will make a particle of difference to those who are already operating in Sudan’s oil fields or those lined up for petrodollar-funded weapons sales and commercial contracts with Khartoum?
Eric Reeves [June 28, 2002]
Northampton, MA 01063
The Bush Administration either doesn’t understand the argument for setting the precedent that would come with US capital market sanctions against the foreign oil companies operating in southern Sudan—or has chosen not to understand the argument. Myopia or hypocrisy. But it is certainly the case that neither the Bush administration nor Senators opposed to conferencing the Sudan Peace Act (the House version of which contains capital market sanctions) has ever seriously and publicly addressed the argument for setting precisely such a precedent. To date, my opinion piece from The Washington Post of last August (below) has been publicly challenged only in a lengthy tirade from Khartoum’s Washington Embassy.
Why is it that Secretary O’Neill and others in the Bush administration won’t say what they believe **is** the threshold for capital market sanctions? Why are those Senators silently, invisibly opposed to capital market sanctions afraid to state publicly their reasons for opposition? Is US capital available for any and all projects, even in the killing fields of southern Sudan? Is genocidal destruction to be countenanced lest we deny an exceedingly small number of foreign companies access to our capital markets? These are questions not answered by glib responses of the sort offered by Secretary O’Neill yesterday to the House International Relations Committee.
The Washington Post, August 20, 2001, Monday, Final Edition
SECTION: EDITORIAL; Pg. A15
HEADLINE: Capital Crime In Sudan
BYLINE: Eric Reeves
A long-overdue American legislative response to Sudan’s catastrophic civil war has become enmeshed in what may seem a peculiarly complex controversy. The Sudan Peace Act, as passed by the House in June, contains provisions for capital market sanctions against oil companies operating in Sudan.
The effect of the sanctions in the bill (which passed 422 to 2) would be to deny these companies access to the U.S. capital markets — that is, they would be de-listed from the New York Stock Exchange and Nasdaq. Predictably, an alliance from Wall Street and the business community reflexively opposes such sanctions, and it has swayed the Bush administration. The argument of these opponents is essentially that such sanctions would create a dangerous precedent and send us down some “slippery slope” toward capital market corruption.
All the companies that would be affected are foreign, because U.S. sanctions already prevent any U.S. commercial exchange with Sudan. All have been authoritatively linked to massive scorched-earth warfare in southern Sudan, where the oil fields are located. And all are content to supply significant oil revenues directly to the National Islamic Front regime in Khartoum, the obdurate party in an 18-year war that has seen more than 2 million people perish and more than 4 million displaced.
The logic of the argument against the House sanctions would suggest that even genocidal destruction can’t be allowed to ruffle capital-market
feathers. If in 1944 it had been discovered that a NYSE-listed company in a neutral country (perhaps Switzerland) was shipping Zyklon-B to Nazi Germany, apparently exchange de-listing could not have been supported. American capital would have been allowed to sustain a firm manufacturing and delivering a key ingredient in the extermination of Jews in Eastern Europe.
This is an object lesson in how those with an exaggerated fear of “slippery slopes” find themselves locked into untenable moral and political postures. Yes, capital market sanctions against oil companies sustaining Sudan’s agony would create a precedent, but so, too, would a de-listing decision in 1944 have been a precedent.
In extreme cases, nearly everyone would agree that the humanitarian
stakes overwhelm the usual concerns about politicizing financial markets. The question is whether Sudan’s war is such a case.
This is the issue now before the Senate, which should feel obliged to take up the House version of the Sudan Peace Act. It has so far contented itself with subsequently (and quietly) passing a version of the bill without any provision for capital market sanctions. This inattention to the key feature of the House version is odd given the legislative history of the bill. The bill originally was introduced into the Senate in 1999 by Sen. Bill Frist, long one of Capitol Hill’s stalwarts on Sudan. He had as co-sponsors Sens. Sam Brownback, Joseph Lieberman and Russell Feingold. The bill had explicit language concerning capital market sanctions.
So where is Frist’s voice today? The senator has fallen strangely silent. And yet the case for capital market sanctions has grown stronger since he himself made it two years ago. Khartoum’s aerial bombardment of civilian and humanitarian targets has escalated, leading to the further disintegration of southern Sudanese civil society and the attenuation of relief efforts. Warfare in the oil regions has expanded, killing and displacing more than 200,000 people. And Khartoum’s notorious policy of “engineered famine” is today even more threatening. In the Nuba region alone, 85,000 people are at immediate risk of starvation because Khartoum has denied all humanitarian access.
Frist and his co-sponsors know that oil development in Sudan is an engine of human destruction that has been chronicled authoritatively by numerous human rights groups. They must face the same question before all those in the Senate: Is Sudan not the egregious case? Is the oil-driven destruction of the people of southern Sudan not sufficient cause to declare that American capital will not be allowed to support foreign companies that have turned a blind eye to such destruction?
This is not a question that can be finessed by politics or compromise.
American capital markets either will or will not host companies complicit in what is, finally, genocide. By all accounts, oil is now fueling Sudan’s civil war and has convinced the Khartoum regime that it can acquire the revenues to effect a military solution to its southern problem.
The House version of the Sudan Peace Act should be considered by the Senate in its morally imperative terms.
[The writer is a professor of English language and literature who has taken a leave to write and do research on Sudan.]