November 30, 2004 | Broadcast

Scarborough Country

Is this the beginning of the end for Kofi Annan?

Joining me now, the investigative journal who broke the story, my friend Claudia Rosett from the Foundation For the Defense of Democracies. And still with us, Mort Zuckerman of “U.S. News & World Report.”

Claudia, let me start with you because you`ve done some amazing pioneering work on this oil-for-food scandal and you deserve a lot of credit for bringing it to the world`s attention.

CLAUDIA ROSETT, “THE WALL STREET JOURNAL”: Hey, Monica. Thank you, and good evening.

CROWLEY: Hi, Claudia.


CROWLEY: Good evening to you, too.

Let`s start with — the current figure that everybody is talking about here is $21 billion, $21 billion stolen from the oil-for-food program, which was supposed to be monitored by the United Nations. Where did all of that money go? Who profited?

ROSETT: OK, it was let`s say $21 billion during the entire stretch under U.N. sanctions and then $17.3 billion, so most of it under the oil- for-food program.

And who profited? This was Saddam taking oil revenues that were supposed to go to feed and minister to the people of Iraq and using them — he had a whole series of uses, to buy arms, to fund terrorists, as we have seen in recent hearings with Henry Hyde`s committee, to suborn and try to buy and corrupt the Security Council, something where there`s a case — a pretty good case has been made that he succeeded.

And beyond that, to fortify his own regime. Saddam was on the ropes when this program was set up. This program helped bring him back. And let`s see. Oh, finally, there`s just massive theft, the building of the palaces and so on.

CROWLEY: Now, you are focusing here, Claudia, on the Iraqis.


CROWLEY: And we know Saddam Hussein and his sons really swindled the U.N. out of this money, and, of course, the U.N. looked the other way. But what about the French and Russians? Talk about the theft there.

ROSETT: OK, they basically — there was tremendous collusion from some member states of the United Nations, especially France and Russia, who Saddam targeted as members of the Security Council, to basically pilfer money that was supposed to go to help people in Iraq.

And the problem with all this — let`s pull back for a minute — in light of the current story is, you had a U.N. secretariat run by Kofi Annan which was supposed to be supervising Saddam. It is turning out in step after step not only did they fail to supervise Saddam. At this stage, we have the problem that apparently the secretary-general was not even in touch with what his own son was doing and certainly failed — perhaps he can`t be held responsible for that.

But what about the U.N. contractor themselves, Cotecna? It is the responsibility, I would think, of the U.N. secretariat, when it hires a contractor, to make some effort to see if money is going to…


CROWLEY: Especially, yes, exactly, when it happens to be the secretariat`s son, who seems to have — profiteering here.


CROWLEY: Mort, let me go to you because you`ve been on top of this story as well.

There have been a series of denials coming out of the United Nations. Everybody related to this scandal is issuing a denial. Let`s start with Kofi Annan, the U.N. secretary-general, as well as his son, because it seems to me that the outstanding question here is, what did Kofi Annan know either about his son`s involvement or about the scandal at large and when did he know it?


No, I think we are now in this really serious position of trying to ask and answer the question, is the United Nations corrupt? You have Benon Sevan, who Kofi Annan`s best friend at the U.N., who was in charge of the administration of the oil-for-food program, who, according to Charles Duelfer, the head of the Iraqi study group, based on the people he interviewed, which included a whole range of Iraqis, and the documents he viewed, took in effect bribery from the Iraqis in his administration of the program of all over $1 million.

You had the secretary-general of the U.N., who is very fine man, Kofi Annan, who literally stated that his son had nothing to do with the contract, had nothing to do with the company going back five years. And we now find out that this child of his, who is in his 20s, was given — are you ready for this? — a noncompete payment of $2,500 a month since 1998, which is absolutely preposterous when you think about it.

What could he in effect a noncompetitive force in? And it makes no sense. And when Kofi Annan goes public with this, it also raises the question — it is hard to believe that he didn`t ask his own son, what were you doing and how much were you getting paid for and what`s your relationship? So the whole Cotecna contract is in a sense under a cloud as well.

And the conflict of interests at the very least should have been made known to the member states of the U.N. if his son was working for them. He left very conveniently shortly before the contract was signed, according to Kofi Annan, yet he was continuing to be paid. For what? It makes absolutely no sense.


ZUCKERMAN: And it puts him into the crosshairs of this — puts Kofi Annan into the crosshairs of this investigation.

CROWLEY: Well, let`s talk about that investigation, because there are a series of ongoing investigations into the scandal, including one being ostensibly conducted by the United Nations itself. How can that investigation have any credibility whatsoever? Isn`t that the corrupt leading the corrupt?

ZUCKERMAN: Well, not necessarily.

That investigation, at least theoretically, is being headed by somebody who is incorruptible, Paul Volcker. But the investigations is not properly funded at this point. What is more, he has no power of subpoena. So he cannot force people to give up their records like the bank, Paribas, which refuses to give up their records. And they were the bank that was involved in all of these money flows. He cannot force many of the people to testify. And what is more. The U.N. Has stonewalled the American congressional committees who are investigating it, saying they do not want to provide these documents. And they also advise all the companies involved not to provide documents to the United States.

This is an outrage. We are a country that really provides the largest percentage of the funds, almost 23, 24 percent of all the money to the U.N. We are the ones whom they are looking to fund their new U.N. headquarters. It is ridiculous that we are not going to be given this information, when we were the country that stood the most to lose from an organization that was being corrupted by these in effect bribery payments.

CROWLEY: Claudia let me go to you on the other investigations, the congressional ones that are ongoing. Does the United States have any power, any influence here to force the U.N. to turn over all of their documents, many of which you have seen, all of their information over to these congressional investigators?

ROSETT: The U.S. controls a great chunk of their money, as Mort Zuckerman just pointed out.

CROWLEY: Are we willing to stand up and fight for this information?

ROSETT: I think we need to be, because the basic problem here, what created what really was the biggest fraud in the history of humanitarian relief, and that just happened on the watch of Kofi Annan under this program, is that the U.N. made a deal involving privilege and secrecy with one of the world`s worst tyrants, Saddam Hussein.

And this was all the way the U.N. operates. They saw nothing very strange in this. That`s what created the incubator for this incredible corruption. And until that changes, expect more. Go scratch at other programs. You will find problems. And if you want a functional institution that does some good for the world, it`s…

CROWLEY: Well, real quickly, Claudia and Mort I want you both to address this. What about the future of Kofi Annan? If he were ignorant of what was happening here, then he`s flat-out inept. If he did know what was going on and looked the other way or even encouraged it, then he`s flat-out corrupt. Should he resign?

Claudia first and then to Mort.

ROSETT: That`s the Kofi conundrum. And I think it`s up to Kofi Annan still to decide what he`s going to do. But we need a functional institution there. And we need somebody running it who`s willing to come clean.

CROWLEY: Mort, is it even possible to have a functional institution at the U.N. or is it just so corrupt, you can`t do anything with it?

ZUCKERMAN: Well, look, the U.N. really encapsulates for many people a lot of noble ideals and the hope for political settlement and peaceful resolution of many conflicts around the world.

But you cannot do it, for example, when, in Iraq, one of the hottest spots in the world, you find out that the U.N. has been an enabler to keep Kofi Annan in power and to suppress his own people. And what`s more, to suborn, as Claudia points out in a brilliant job of reporting, to suborn the government of France, where they specifically were described by their foreign minister, Tariq Aziz, in the Duelfer report, the Iraqi study group report, that what they wanted were the contracts to develop two major oil fields, this is national corruption.

This is institutional corruption. This is personal corruption. And this is financial corruption on a scale that we have not seen. And it has done huge damage to the United Nations, at least in this part of the world, of course not in France, where they accept that as a normal part of life.

CROWLEY: Well, it seems to me that Kofi Annan has presided over so many serious security and humanitarian failures that, if he had an ounce of honor left, he would step down voluntarily. But I`m not holding my breath on that.

All right, I`m going to ask you both to stick around, because, coming up, we`re going to talk about why this important story and so many others like it are missing from the mainstream media.

Don`t go away.

CROWLEY: Victories in the war on terror, widespread corruption at the United Nations. We`ll tell you why the elite media is missing the biggest stories of the year.

But, first, let`s get the latest headlines from the MSNBC News Desk.


ANNOUNCER: From the press room, to the courtroom, to the halls of Congress, Joe Scarborough has seen it all. Welcome back to SCARBOROUGH COUNTRY.

CROWLEY: A top terrorist captured, new evidence of Iraq`s weapons of mass destruction, and ties discovered between Saddam Hussein and the leaders of old Europe, these may be the biggest stories of the year, but why aren`t they making headlines in the elite media?

We`re back with Mort Zuckerman and Claudia Rosett. And now we`re joined also by Bob Kohn. He`s the author of “Journalistic Fraud: How The New York Times Distorts the News and Why It Can No Longer Be Trusted.”

Welcome to the program, Bob. Nice to see you.


CROWLEY: All right, Mort, let me start with you because, before the break, we were talking about oil-for-food.

And with the exception of an intrepid reporter like our friend Claudia Rosett, you, as a columnist, you`ve been writing abut this. Bill Safire over at “The New York Times,” sort of “The New York Post” and “The Wall Street Journal” and “The New York Sun,” they have been covering it. But why haven`t we seen more extensive coverage? This is the world`s biggest swindle? Why haven`t we seen more coverage of it?

ZUCKERMAN: Well, I think there was more coverage than you are implying, at least of the financial scandal part of it, when that broke.

It`s a difficult story to get to. And I think Claudia Rosett did a brilliant job, along with “The New York Sun,” in really keeping after it and keeping a lot of focus on it. But frankly a lot of the sort of the cutting edge of news now is on the cable networks and their political talk shows, and that`s where you see a lot more of this, these kinds issues, covered.

CROWLEY: And talk radio, too, Mort, talk radio, too.


ZUCKERMAN: And talk radio, too, absolutely.

But some of the more traditional media may — I was amazed, for example, that this story was not covered in “The New York Times” today, at least in my addition of “The New York Times.”

CROWLEY: Well, let me go to Bob.

Because, Bob, you`ve written a whole book about “The New York Times.”

KOHN: Right.

CROWLEY: Apart from Claudia Rosett, where are the investigator reporters on this? I thought that Watergate was supposed to give us a whole new generation of investigative reporters. Why haven`t they been digging through this story?

KOHN: It`s pretty amazing.

You say “The New York Times.” William Safire is an op-ed columnist. He writes an opinion column every week. And he`s been doing the main investigative reporting work for “The New York Times” here. It reminds me of the old Busby Berkeley films with Mickey Rooney, one-man band with the drum and harmonica. William Safire has been an investigative reporter. He`s been writing the stories. And he`s been acting like the editorial page, because he today called for the resignation of Kofi Annan. Where`s the rest of the paper?

CROWLEY: It`s been Bill Safire and Claudia Rosett. Where is everybody else? It`s unbelievable.

Claudia, I want to go to you, because another major story got buried last week. The world`s second most wanted terrorist, Abu al-Zarqawi, practically admitted defeat when he criticized Muslim scholars in his statement last week. And here is his quote: “You have let us down in the darkest circumstances and handed us over to the enemy. You have quit supporting the mujahedeen.” He went on to add, “You left the mujahedeen facing the strongest power in the world — that would be us — “and not your heart shaken by the scenes of your brothers being surrounded and hurt by your enemy.”

Well, Claudia, an enormous story here, and yet “The New York Times” buries it on page A-22 in their Thanksgiving Day edition, which nobody really reads on the holiday. “The Washington Post” turns around and buries it in the 17th paragraph in another story about another development in Iraq.

What is going on here?

ROSETT: What`s going on here is at some point they`re going to realize they could probably sell more newspapers if they covered stories that people clearly do want to read about.

That`s what actually I think is going on. You have got some kind of market shakeout going on. And I think to some extent you still have editors who perhaps are addressing ideas that are not necessarily just where their readers are. Also, I must say there has been some terrific coverage of, say, the U.N. oil-for-food story, but it`s been spotty.

It`s interesting. You`ll get a very good story in one publication and then it`s kind of dropped for awhile. What we haven`t seen is a paper, apart from, say, “The New York Sun,” which really has been covering it — and “The Wall Street Journal” has been pretty well on this — but that has just said — just, as you said, the world`s biggest swindle. Let`s cover it, the way you once covered BCCI, the way that, you know — again, I think some closer look is just needed at what the assumptions are.

CROWLEY: Bob, let me turn to you because you`ve written a whole book about “The New York Times.” You know the elite media very well. This story about al-Zarqawi is huge. We have a dispirited terrorist.

We have terrorists morale apparently shattered, according to the statement. This is a huge victory for the United States and our coalition in the war on terror, huge story. And yet the mainstream media buries it. They don`t cover it. Why?

KOHN: Monica, the people making the decisions as to what goes on the front page and what goes — gets buried in the middle of the newspaper, “The New York Times,” or what stories get covered and what stories don`t get covered, it`s Bill Keller, the executive editor, and Jill Abramson, the managing editor. They`re the ones who make these decisions.

And, frankly, I don`t think the election is over for these people. I think that they`re still in the mode of trying to embarrass the administration or at least mute all of the good news and try to pump up all of the bad news. On the front page of today`s “Times,” the headline is, “Shadow of Vietnam Falls Over Iraq.” That`s the front page of “The New York Times.”

CROWLEY: I know. It`s outrageous.

KOHN: Isn`t that outrageous, compared to what the real news is, the success in Fallujah and the finding of all of these ground-to-air missiles in Fallujah? That was huge news today. It was on the front page of “USA Today.” And then it`s on — the oil-for-food program, which “The New York Sun,” a real upstart newspaper, which is gaining a lot of ground, doing some great coverage, is embarrassing the heck out of Bill Keller and Jill Abramson.

I think it`s embarrassing for “The New York Times” to have William Safire scoop their own reporters.

CROWLEY: On the op-ed page, of all places.

KOHN: Right. Right.

CROWLEY: Mort Zuckerman, there also was another enormous story about a discovery of a chemical lab in Iraq and sort of, we`re on the trail of weapons of mass destruction there, and yet again, another story buried by the mainstream press.


CROWLEY: You cannot tell me that liberal media isn`t playing a role in how these stories are covered.

ZUCKERMAN: Well, I`m not sure that I share that view.

I have to say that when you have the Iraq study group making a definitive statement that the threat extant from existing nuclear weapons or military stockpiles of weapons of mass destruction do not exist, but there is a latent threat there, there, they covered only the one half of it, not the other half, on that, I agree.

The question is, what is the importance of these acts? What is the importance ever al-Zarqawi`s statement? While it does indicate some disarray, nevertheless, he`s still leading a major insurgency in Iraq, and that is not over. And that is still the major story as it is seen by many editors. I don`t disagree that this isn`t an important indication of where it`s going.

And the press by and large tends to cover the bad news and not the good news. It`s the nature of the way the press works. But having said that, I do think that, for example, “The New York Times” — Bill Safire happens to be a great investigative journalist, as well as great columnist. But Judy Miller did a major store on the oil-for-food program.

They haven`t followed it, frankly, quite as relentlessly and as expertly as Claudia Rosett. But she`s a rare journalist on this story, who clearly knows the story better than anybody else. So I don`t fault the press to the extent that you do.

CROWLEY: Well, I think that any kind of story that looks like it`s going to vindicate President Bush or his approach in the war on terror tends to get buried by the liberal and elite media.

Guys, I want to thank you so much for your time tonight, Claudia Rosett, Mort Zuckerman and Bob Kohn. Thank you for joining us in SCARBOROUGH COUNTRY.