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June 29, 2010

T.M.I. ??

As in, Too Much Information?

Being in the news biz as we are, complaining about Too Much Information from the US government might seem a bit counter-intuitive, not to mention whine-y. But we have been noticing how the daily public schedule of top officials put out by the State Department keeps getting longer ... and longer ... and longer.

The intent here seems not to share real information about what's being accomplished by American diplomacy, what roadblocks are being encountered, which tough decisions are being made and ugly compromises acceded to, so much as to convey a general impression of YOUR STATE DEPARTMENT HARD AT WORK.

We'll let you decide. Here's the Daily Appointments Schedule for one day last week. You'll need to scroll down. For a while.

Daily Appointments Schedule for June 23, 2010


Washington, DC
June 23, 2010


SECRETARY OF STATE HILLARY RODHAM CLINTON

10:00 a.m.  Secretary Clinton meets with the Under Secretaries, at the Department of State.
(CLOSED PRESS COVERAGE)

11:35 a.m.  Secretary Clinton attends a meeting with President Obama at the White House.
(MEDIA TO
BE DETERMINED BY WHITE HOUSE)

1:30 p.m. 
Secretary Clinton meets with Israeli Defense Minister Ehud Barak, at the Department of State.
(CAMERA SPRAY PRECEDING BILATERAL MEETING)

Pre-set time for video cameras: 12:45 p.m. from the 23rd Street entrance.
Final access time for journalists and still photographers:  1:15 p.m. from the 23rd Street entrance.


3:30 p.m. 
Secretary Clinton calls Colombian President-elect Juan Manuel Santos.
(CLOSED PRESS COVERAGE)

4:30 p.m. 
Secretary Clinton meets with President Obama at the White House.
(MEDIA TO BE DETERMINED BY THE WHITE HOUSE)

5:00 p.m.
  Secretary Clinton meets with Secretary of Defense Bob Gates and National Security Advisor Jim Jones, at the White House.
(MEDIA TO BE DETERMINED BY WHITE HOUSE)

5:30 p.m. 
Secretary Clinton attends a meeting at the White House.
(MEDIA TO BE DETERMINED BY WHITE HOUSE)

6:00 p.m. 
Secretary Clinton attends a meeting at the White House.
(MEDIA TO BE DETERMINED BY WHITE HOUSE)


DEPUTY SECRETARY JAMES STEINBERG


10:00 a.m. 
Deputy Secretary Steinberg joins Secretary Clinton’s meeting with the Under Secretaries, at the Department of State.
(CLOSED PRESS COVERAGE)

11:35 a.m.  Deputy Secretary Steinberg attends a meeting with President Obama at the White House.
(MEDIA TO
BE DETERMINED BY WHITE HOUSE)

1:00 p.m. 
Deputy Secretary Steinberg meets with Indian Science and Technology Minister Prithviraj Chavan, at the Department of State.
(CLOSED PRESS COVERAGE)

2:30 p.m. 
Deputy Secretary Steinberg attends a meeting at the White House.
(MEDIA TO
BE DETERMINED BY WHITE HOUSE)

3:30 p.m. 
Deputy Secretary Steinberg attends a meeting at the White House.
(MEDIA TO
BE DETERMINED BY WHITE HOUSE)


DEPUTY SECRETARY JACOB LEW

3:30 p.m. 
Deputy Secretary Lew meets with Congressman Norm Dicks, in the Rayburn House Office Building.
(CLOSED PRESS COVERAGE)


USAID ADMINISTRATOR RAJIV SHAH

8:30 a.m. 
Administrator Shah meets with Ethiopian Minister of Health Tedros Ghebreyesus, at USAID.
(CLOSED PRESS COVERAGE)

9:00 a.m.
 Administrator Shah delivers opening remarks at a panel discussion co-hosted by the Brookings Institution on education in Pakistan, in the Rotunda of the Ronald Reagan Building.
(OPEN PRESS COVERAGE)

For more information, contact [email protected].


11:35 a.m. 
Administrator Shah attends a meeting at the White House.
(MEDIA TO BE DETERMINED BY WHITE HOUSE)

1:30 p.m. 
Administrator Shah meets with AFSA President Susan Johnson, at USAID.
(CLOSED PRESS COVERAGE


UNDER SECRETARY FOR ARMS CONTROL AND INTERNATIONAL SECURITY AFFAIRS ELLEN TAUSCHER

10:00 a.m. 
Under Secretary Tauscher joins Secretary Clinton’s meeting with the Under Secretaries, at the Department of State.
(CLOSED PRESS COVERAGE)


1:00 p.m.  
Under Secretary Tauscher meets with Singaporean Ambassador Chan Heng Chee, in Washington, D.C.
(CLOSED PRESS COVERAGE)

3:00 p.m. 
Under Secretary Tauscher meets with British Ambassador Nigel Sheinwald, at the Department of State.
(CLOSED PRESS COVERAGE)

3:30 p.m. 
Under Secretary Tauscher meets with visiting Parliamentarians from the European Union and Russia, at the Department of State.
(CLOSED PRESS COVERAGE)


UNDER SECRETARY FOR DEMOCRACY AND GLOBAL AFFAIRS MARIA OTERO

Under Secretary Otero delivers a speech on at the 2010 Ny-Alesund Symposium on The Changing Arctic and Its Global Implications in Ny-Alesund, Svalbard. For more information, click here.


UNDER SECRETARY FOR ECONOMIC, ENERGY AND AGRICULTURAL AFFAIRS ROBERT HORMATS

11:00 a.m. 
Under Secretary Hormats meets with a group of African ambassadors to discuss the upcoming G-8 and G-20 Leaders Summits, at the Department of State.
(CLOSED PRESS COVERAGE)

PM  
Under Secretary Hormats travels to Canada to participate in the G-8 and G-20 Summits through June 27.


CHIEF OF PROTOCOL AMBASSADOR CAPRICIA PENAVIC MARSHALL

1:30 p.m. 
Ambassador Marshall hosts a State of the Administration series with speakers Director of the National Economic Council Larry Summers and Chairman and President of the Export-Import Bank
Fred Hochberg, at the Department of State.
(CLOSED PRESS COVERAGE)


SPECIAL REPRESENTATIVE FOR AFGHANISTAN AND PAKISTAN RICHARD HOLBROOKE

Ambassador Holbrooke is on official travel in Afghanistan and Pakistan through June 24.


ASSISTANT SECRETARY FOR INTERNATIONAL ORGANIZATION AFFAIRS ESTHER BRIMMER

Assistant Secretary Brimmer travels to Rome, Italy and Geneva, Switzerland through June 25. For more information, click here.


ASSISTANT SECRETARY FOR AFRICAN AFFAIRS JOHNNIE CARSON

Assistant Secretary Carson is on travel to Lisbon, Khartoum, Juba and Nairobi through June 28.


ASSISTANT SECRETARY FOR NEAR EASTERN AFFAIRS JEFFREY FELTMAN

1:30 p.m.  Assistant Secretary Feltman joins Secretary Clinton’s meeting with Israeli Defense Minister Ehud Barak, at the Department of State.
(CAMERA SPRAY)

5:00 p.m.
  Assistant Secretary Feltman briefs Senators Casey, Shaheen and Kaufman for their upcoming travel to the Middle East, on Capitol Hill.
(MEDIA TO BE DETERMINED BY SENATE)


ASSISTANT SECRETARY FOR INTERNATIONAL NARCOTICS AND LAW ENFORCEMENT AFFAIRS DAVID JOHNSON

Assistant Secretary Johnson travels to Peru to meet with senior officials through June 24.


ASSISTANT SECRETARY FOR DEMOCRACY, HUMAN RIGHTS AND LABOR MICHAEL POSNER

1:00 p.m.
  Assistant Secretary Posner attends the Human Rights Democracy Fund Conference at Georgetown University School of Law.
(MEDIA TO BE DETERMINED BY GEORGETOWN)

4:00 p.m.
  Assistant Secretary Posner delivers remarks at the Floribert Chebeya Bahzire Memorial Service, in Washington, D.C.
(MEDIA TO BE DETERMINED)



ASSISTANT SECRETARY FOR WESTERN HEMISPHERE AFFAIRS ARTURO VALENZUELA

9:30 a.m. 
Assistant Secretary Valenzuela delivers opening remarks to the 2010 Fulbright Scholars at their pre-departure orientation, at the Renaissance Hotel in Washington, D.C.
(CLOSED PRESS COVERAGE)

10:30 a.m.  
Assistant Secretary Valenzuela meets with Ecuadoran Ambassador Luis Gallegos, at the Department of State.
(CLOSED PRESS COVERAGE)

12:30 p.m.  
Assistant Secretary Valenzuela meets with Deputy U.S. Trade Representative Miriam Sapiro, at the Office of the U.S. Trade Representative.
(CLOSED PRESS COVERAGE)

4:00 p.m. 
Assistant Secretary Valenzuela meets with Congressman Pedro Pierluisi, at the Longworth House Office Building.
(CLOSED PRESS COVERAGE)


DIRECTOR GENERAL OF THE FOREIGN SERVICE NANCY POWELL

4:00 p.m. 
Director General Powell delivers remarks at the American Foreign Service Association Awards Ceremony, at the Department of State.
(OPEN PRESS COVERAGE)
For more information, contact Tom Switzer at 703-608-7341.


AMBASSADOR-AT-LARGE TO MONITOR AND COMBAT TRAFFICKING IN PERSONS LUIS CDEBACA

12:00 p.m.
  Ambassador CdeBaca delivers remarks on the 2010 Trafficking in Persons Report to a luncheon diplomatic lecture series at Johns Hopkins University’s School of Advanced International Studies (SAIS).
(MEDIA TO BE DETERMINED BY SAIS)
For more information, contact (202) 663-5896.


AMBASSADOR-AT-LARGE AND GLOBAL AIDS COORDINATOR ERIC GOOSBY

Ambassador Goosby is on travel to Geneva, Switzerland to participate in the UNAIDS Program Coordinating Board meeting through June 23. 


AMBASSADOR-AT-LARGE FOR GLOBAL WOMEN’S ISSUES MELANNE VERVEER

Ambassador Melanne Verveer travels to Islamabad and Lahore, Pakistan to co-lead the gender working group of the U.S.-Pakistan Strategic Dialogue through June 25. 


COORDINATOR FOR INTERNATIONAL ENERGY AFFAIRS DAVID GOLDWYN

9:15 a.m.  Coordinator Goldwyn delivers remarks at a session of the Washington Energy Seminar series, at the Department of State.
(CLOSED PRESS COVERAGE)
For more information, contact [email protected]


SPECIAL REPRESENTATIVE FOR COMMERCIAL AND BUSINESS AFFAIRS LORRAINE HARITON

1:00 p.m.
 Special Representative Hariton delivers the keynote address at the Women’s Business Enterprise National Council (WBENC) 2010 annual conference, in Baltimore, Maryland.
(OPEN PRESS COVERAGE)
For more information, click here.


PRESS BRIEFING SCHEDULE

2:30 p.m.  Daily Press Briefing.

June 23, 2010

New report examines nuclear threat of "failing" North Korean regime

The RAND Corp. has published a highly sobering assessment of the threat posed to East Asia and U.S. forces there by the nuclear arsenal of North Korea as the isolated Stalinist state grapples with economic failure, growing popular discontent and the failing health of dictator Kim Jong-Il.

"North Korea is a failing state that is increasingly dependent on its nuclear weapons for deterrence of outside intervention, forth both internal and external leverage in peacetime, and for overcoming its conventional inferiority in a time of war," says the report.

Noting how little is known about the North Korean nuclear arsenal or the political dynamics within the ruling elite, the assessment poses a number of possible scenarios, including an internal coup that divides the regime and ignites a civil war that spills into northern China and South Korea and sees opposing factions use nuclear weapons.

Another possibility foresees a splintering North Korean regime having to "chose between a diversionary war against common external foes to unify North Koreans or risk internal overthrow and regime collapse."

North Korea, the report says, would likely use its nuclear weapons to threaten and target cities in South Korea and Japan in the event of a war because they would wreak greater casualties and destruction than employing them against ground forces.

One 10-kiloton warhead that hit Seoul could cause more than 400,000 casualties and devastate the South Korean economy, with the financial cost amounting to nearly $1.5 trillion.

The report comes amid serious tensions over South Korea's charges that one of its warships was sunk, with the loss of more than 40 crewmen, by a North Korean torpedo in March.

So what happened in the Obama/McChrystal meeting?

The most important meeting between the military’s top Afghanistan commander and President Obama has just ended and no one here at the Pentagon knows what happened. Here is a snapshot from here. The sight of Gen. Stanley McChrystal leaving the White House even as a meeting on Afghanistan-Pakistan strategy is slated to begin in an hour left his supporters here despondent, 11:35 a.m. to be exact. It doesn’t look good, they concede. And they said they know that this whole episode has caused irreparable damage to the strategy, regardless of whether the President fired his general.

But no one knows what actually happened. Instead, everyone is waiting to see if McChrystal's SUV pulls back up at the White House for the Afghanistan-Pakistan meeting. Secretary of Defense Robert Gates and Adm. Michael Mullen, the chairman of the Joint Chiefs of Staff, were at the White House around the time of McChrystal's meeting with the President and remained for the next meeting.  Gates met with McChrystal at the Pentagon an hour before the general headed to the White House.

We will know in just minutes.

UPDATE: It appears the general did not attend the meeting, and my fellow journalists here are hearing rumors that Gen. McChrystal is back at his home at Fort McNair. The president is scheduled to make a statement from the Rose Garden at 1:30 p.m.

June 21, 2010

The latest rhetoric on Afghanistan

The Obama administration’s top leaders on Afghanistan have been awfully sensitive these days about their stalled efforts there. Michele Flournoy, the Undersecretary of Defense for Policy wrote a letter to the Washington Post this morning disputing an editorial that suggested the U.S. effort there wasn’t clear. It is, she wrote; the United States wants to dismantle, disrupt and defeat al Qaida. She also testified last week that overall things are headed in the right direction there. U.S. Central Command commander Gen. David Petraeus went to great pains last week to assure a dubious Senate Armed Services committee that while things look bad, in a few months there could be a marked improvement. And last week, Secretary of Defense Robert Gates called the narrative on Afghanistan “too negative.” He went on to say that the talk about Afghanistan felt like déjà vu to him when many were pessimistic about Iraq in 2007, just right violence dropped.

It feels like déjà vu to me as well. It reminds of when I lived in Iraq and the situation was collapsing around me. I would read comments from top military leaders out of both Washington and Baghdad and ask myself, “Are we talking about the same Iraq?” "Reports of violence are exaggerated," they told us as we buried friends and awoke daily to the sound of nearby car bombs; "the media is misinformed," officials barricaded inside the Green Zone told us as we lived amongst Iraqis; "things will get better soon," they said as the situation deteriorated around us on a daily basis. Back then, domestic politics defined the rhetoric, not the reality on the ground. But those comments had a long-term impact as well. They delayed leaders having a serious, candid and thoughtful discussion about how to improve the situation.

I fear the same is happening again What does the end state look like? Does the United States care or is it just aiming to kill al Qaida? If it is the latter, should the military be in Afghanistan or in al Qaida's new safe havens in places like Pakistan, Somalia, Yemen and throughout Europe? Will troops leave in masses around the July 2011 deadline and Vice President Biden promised or slower as Petraeus suggested? Assuring a successful outcome in Afghanistan begins with an honest appraisal of the situation there. Delusions of otherwise cost the United States creditability – and the lives of her troops. 

June 18, 2010

Army suicides nearly equal OEF death toll

So far in 2010, nearly as many active and non-active duty troops have committed suicide as have died while serving in Afghanistan, or Operation Enduring Freedom (OEF), 163 and 172, specifically (This story was first reported by NPR and you can read/listen to it here). What a grim milestone in the history of the war. The Army has tried to aggressively address this growing problem, but there is no clear indication of what causes a soldier to commit suicide. It goes across bases, services, job descriptions and wars. The only indicator is that the strain of multiple tours and nearly a decade of war is affecting the troops mentally and physically in ways no one has yet to fully comphrehend.

The numbers are a reminder that every soldier fights two wars – the one on the battlefield and the one when he/she returns home.  Everyone’s war experience is unique and in the middle of war, there is no time to process it. Rather than digest experiences, soldiers are striving to survive. Only at home does it fully start to sink in. And then the battle begins. It makes me wonder whether the military should consider the deaths as part of the wars' casualty figures.

Expert group questions announcement of new Iranian research reactors

The Institute for Science and International Security has come up with an interesting take on Iran's announcement this week that it intends to build four new nuclear research reactors to produce medical isotopes, beginning with a replacement for the aging Tehran Research Reactor.

What if Iran made the announcement - which came less than a week after it was slapped with new U.N. sanctions - as a excuse to continue enriching uranium to 20 percent or higher, and to add new centrifuges to its production facility at Natanz, asks ISIS.

Iranian state-run media quoted Vice President Ali Akbar Salehi, a U.S.-educated physicist who also heads the country's nuclear agency, as saying on June 16 that the design work on the first new research reactor would be completed by the end of this year and the construction of the facility would take two more years.

But as an ISIS briefing paper points out, Iran has never built a reactor, Salehi did not disclose the locations of the new research reactors, and Iran "has still not learned to make research reactor fuel."

"Given the unrealistic nature of Iran's announcement, the question is whether it is a pretext for a claim that it must continue producing 20 percent enrichment to fuel these new reactors," the paper said. "Iran could also use its latest announcement as justification for employing additional cascades . . . at Natanz."

Uranium enriched to 20 percent is far short of the 90 percent level required for nuclear weapons fuel. But it is much closer to that level than the 5 percent low-enriched uranium needed for commercial power reactors.

June 16, 2010

Afghanistan mineral discovery story -- scoop or old news

The New York Times led its paper the other day with news that there was a recent discovery of untapped natural resources in Afghanistanthat could generate $1 trillion worth of revenue, a potential boon to both Afghanistan's economy and its rampant corruption. CENTCOM commander Gen. David Petraeus is quoted in the piece, calling it a “stunning potential.”

Yet the piece was met with immediate skepticism around Washington; many claimed that rather than being a scoop for the Times, it was old news dating back to 2007 when Pentagon geologists first discussed the discovery. McClatchy wrote about a coper discovery in 2009. Dean Baquet, the Times bureau chief, however, vigorously defended the piece in an interview as has its author, James Risen. At issue, really, is whether the Obama administration used the Times to bolster its case for being in Afghanistan and spun the paper to run a story even though it was not news, but rather politically helpful.

Today, Petraeus and Michele Flournoy, the undersecretary of defense on policy, chimed in on the issue during their testimony before the Senate Armed Services committee. Under questioning from North Carolina Sen. Kay Hagan, both asserted the story was in fact old news. Here is the transcript.

SEN. HAGAN: You mentioned the newfound wealth of the minerals.
I note that on June the 14th, The New York Times reported this
discovery of nearly a trillion dollars in untapped mineral deposits.
Does this new mineral wealth have the ability to fundamentally alter
the Afghan economy, but does it also have the ability to amplify the
existing problems of government corruption as well as provide greater
incentive for the Taliban to actually fight for control of the
government?

I was just wondering, does Afghanistan's -- this newfound wealth
in any way alter the coalition's counterinsurgency approach,
governance, support plan, development plan? And I know this would be
years in the making, but on the ground now, how does this play into
our strategy?

GEN. PETRAEUS: Well, first -- to answer your first question, I
think it's sort of an “all of the above”; potential is present.
Potentially it could be an incredible boon to Afghanistan. It could
enable them to pay for their own governmental officials, forces,
programs and so forth in a way that I think prior to this there was
not that same expectation; but again, being very careful about how
difficult this will be.

Beyond that, we have been engaged -- again, this was not a
revelation to a lot of us who have been working this.
Again, there's
a keen awareness of the different copper deposits. China is already
in, in Aynak, trying to extract that and to build the infrastructure
necessary and to get it out and so forth.

But there is an awareness of these different opportunities that
are out there. Some of them are being exploited in small ways by
either local strongmen -- I don't know if I'd quite go to warlords,
but different power brokers and so forth or officials.

And it's very important that there be a legal regime that governs
this, as well. And this is something that we're quite keenly aware,
and the civilian elements who've been working them. Just to give you
one example, the timber, there's enormous timber resources in eastern
Afghanistan in particular. There is a law. They haven't been able to
implement it. And that's the kind of effort that has to go forward if
it's to become something that serves the state rather than just some
interests within it.

MS. FLOURNOY: I would just add, when we became aware -- when the
survey results came in last year, I think what it has done, even
though it's a very long-term project, it has helped to inform some
prioritization;
for example, putting more priority on capacity-
building in the Ministry of Mines, the Ministry of Finance, putting
more emphasis on looking at this particular area of law and regulation
so that we try to sort of -- if we're going to start with a sector,
let's start with this sector.

And it's also -- we're trying now to work with AID and others to
make sure that the knowledge of some of these deposits and so forth
actually inform some of our near-term projects in communities where
these are located. So you start creating the foundations that will
eventually position those communities to take fill advantage of the
wealth that's literally right underneath them.

So I think it has informed some reprioritization of our efforts
on the development side.

SEN. HAGAN: I see my time is up. Thank you, Mr. Chairman.

June 15, 2010

CFR: Obama NK policy "reactive" and "half-hearted"

KoreaTFRcoverlrg_4  A new report by the Council on Foreign Relations, available here with accompanying commentary, finds that the Obama administration's policy toward North Korea's provocations has largely been "reactive" and its commitment to rolling back the North's nuclear program "half-hearted."

  "Despite ... strong words, the Obama administration’s actions to
date suggest that the objective of rollback of North Korea’s nuclear
program is halfhearted," the document says. "The time frame for achieving denuclearization is so vague that there is a significant risk that 'strategic patience' will result in acquiescence to North Korea’s nuclear status as a fait accompli."

  "Strategic patience" is what the Obama-ites call their own policy toward North Korea. It's essentially a deep cynicism about dealing with Pyongyang, after years of its perceived back-tracking on agreements already reached, plus provocations such as its April 2009 long-range rocket test and its second underground nuclear test in May 2009.

  The report quotes Defense Secretary Robert Gates, speaking of a nuclear deal with North Korea, the Obama administration “will not buy this horse for a third time."

  Still, strategic patience has not stopped the North from apparently moving ahead with its nuclear and missile programs, or its belligerent behavior, such as the unprovoked sinking of the South Korean naval ship Cheonan, the report says.

  The report calls for the resumption of the Six-Party talks (which include the two Koreas, China, Japan, Russia and the United States) on North Korea's nuclear weapons, but says that is not sufficient. The United States should also open bilateral talks with Pyongyang on its missile program and establish a formal dialogue with China--which has more leverage than any of the other players--on North Korea.

  Hanging over all this, of course, is the ongoing succession process from North Korea's ailing "Dear Leader" Kim Jong-Il to his son.

June 10, 2010

U.S. allows Indian investigators to quiz Mumbai attack conspirator

Indian investigators have spent seven days quizzing an American who pleaded guilty to helping a Pakistani extremist group, Lashkar-e-Taiba, plan the November 2008 terrorist attack in Mumbai.

The State Department said that the Indians were given access to David Coleman Headley "as part of the cooperation and partnership between the United States and India in the fight against international terrorism."

"Mr. Headley and his counsel agreed to the meetings," said a State Department press release. "There were no restrictions on the questions posed by the Indian investigators."

So what did Headley tell his interlocutors from India's National Investigating Agency? The State Department wasn't saying.

"To protect the confidentiality of the investigations being conducted by both India and the United States, both countries agreed not to disclose the contents of the interviews," the State Department said.

Indian news reports, however, said that Headley implicated Pakistan's chief intelligence agency, the Inter-Services Intelligence Directorate, in the attack, an allegation denied by Pakistan.

Headley pleaded guilty on March 18 in U.S. court in Illinois to 12 federal terrorism charges. He admitted scouting locations and providing advanced support for the Mumbai attack that left 163 people dead and more than 300 injured, as well as to plotting to attacking a Danish newspaper that published cartoons in 2005 of the Prophet Mohammad. 


Did the State Dept go to bat for First Kuwaiti?

  First_kuwaiti

Some of our readers may tire of the saga of First Kuwaiti General Trading & Contracting Co., which has had a controversial part in four State Department embassy construction contracts, but new information keeps coming in - and N&S is determined to follow this story to the end.

The latest development involves allegations - and we stress, they are just allegations - that the State Department went to bat for First Kuwaiti back in 2006, forcing an American construction firm known as Grunley-Walsh International to accept  FKTC as a subcontractor under terms very favorable to First Kuwaiti.

That's the substance of a letter to the State Department from lawyers for Aurora LLC, as Grunley-Walsh was renamed after it was sold (we hear at a bargain basement price) to a trio of investors who included a former top First Kuwaiti employee.

At the time, Grunley-Walsh had won three State Department contracts, to build a U.S. Embassy in Gabon and consulates in Jeddah, Saudi Arabia and Surabaya, Indonesia. (As we've previously reported, Aurora and First Kuwaiti have been kicked off the jobs in Gabon and Saudi Arabia). First Kuwaiti, meanwhile, was building the massive U.S. Embassy in Baghdad, where investigators found numerous, potentially life-threatening flaws in the work.

The April 29, 2010 letter from Aurora's lawyers alleges that the State Department's bureau of Overseas Building Operations  (known by the acronym OBO) knew that the agreement between Aurora and First Kuwaiti actually put the foreign subcontractor, not the U.S. prime contractor, in charge:

Aurora may not coordinate, supervise or control FKTC's work.

Aurora may not stop work at the site regardless what FKTC may have done or failed to do in terms of safety, health or security.

Aurora may not take work away from FKTC when FKTC fails to perform it.

As maintained by FKTC and apparently endorsed by OBO, Aurora must pay FKTC a fixed share of contract receipts regardless whether FKTC has performed well or even performed at all.

The letter then goes on to make a startling charge:

Any prime contractor that willingly entered into such an arrangement would be justly questioned on grounds of sanity. In fact, Aurora's predecessor did not enter into this agreement willingly, but was compelled to do so by the concerted and combined actions of FKTC and OBO.

The letter's author, Richard C. Johnson of the firm Smith Pachter McWhorter declined comment, due to the ongoing contractual/legal dispute.

A State Department official with knowledge of the issue disputed this version of events. "The State Department has not interfered with the subcontracting arrangements of Aurora LLC predecessor Grunley Walsh or those of Aurora LLC," said the official, who was not authorized to speak for the record. "The content of language in a contract between contractors and subcontractors is a matter for discussion and negotiation between those two parties."

The official noted that Aurora was terminated from the Jeddah contract on May 10 this year, after 90 percent of the contract period had expired, with only 54 percent of the work done. (Aurora, according to other letters we obtained, is demanding $10.5 million in breach damages from the government, as well as $5.7 million for work it performed).

To make its case that it shouldn't be held responsible for the failure in Jeddah, Aurora cited an odd series of events it said occurred in November and December 2006, soon after it was awarded the three prime contracts.

The letter alleges that First Kuwaiti made it impossible from the outset to execute the contracts, "linking its further performance to GW's sale of its company to FKTC." Grunley-Walsh notified the State Department of the problem and, in November 2006, "with OBO's help and involvement located and signed up a substitute partner and prepared to go forward."

But, after "secret meetings" between First Kuwaiti and OBO, on November 28, 2006, OBO issued 10-day warnings, known as "cure notices," on all three construction contracts, the letter says. On November 30, it rejected the alternate partner and told Grunley Walsh "it could only go forward with FKTC or face three default terminations that would effectively destroy the company."

"As a direct consequence of OBO's actions, G-W was forced to accept the sale of its international division at a bargain basement price, and to accept the terms of an FKTC-dictated subcontract almost identical to those it had rejected earlier."

Hmmm. Was someone at the State Department working on First Kuwaiti's behalf? And if so, why? the story isn't over...

ABOUT THIS BLOG

"Nukes & Spooks" is written by McClatchy correspondents Jonathan S. Landay (national security and intelligence), Warren P. Strobel (foreign affairs and the State Department), and Nancy Youssef (Pentagon).

jon, nancy & warren

Landay, Youssef and Strobel.

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