UK state: collateral damage

Michael Keaney michael.keaney at
Thu Jan 23 08:09:02 MST 2003

Right now I believe that the British government is on a precipice, once
again because it is trying to balance domestic demands with imperialist
imperatives. The imperialism in question, US, has unique leverage over the
UK because of the UK's non-entry into the eurozone and the perennial
difficulty of keeping the currency strong whilst the trade balance goes ever
further into the red. An additional, and potentially explosive, aspect of US
leverage over Blair is the FBI's investigation of users of child porn
websites which has already claimed a number of high profile scalps.
According to the Sunday Herald at least two former Labour ministers are
included in this haul, including one "high profile" ex-Cabinet minister.
Here's an extract of the report:

Child porn arrests 'too slow'

By Neil Mackay, Home Affairs Editor
The Sunday Herald, 19 January 2003

OPERATION Ore, the police inquiry which plans to arrest a further 7000 men
across the UK, in addition to Who guitarist Pete Townshend, for buying child
pornography online is set to end in disaster with many suspects walking

Detective Chief Inspector Bob McLachlan, former head of Scotland Yard's
paedophile unit, told the Sunday Herald that the lack of urgency in making
arrests will lead to suspects destroying evidence of downloading child
pornography before they are arrested.

The Sunday Herald has also had confirmed by a very senior source in British
intelligence that at least one high-profile former Labour Cabinet minister
is among Operation Ore suspects. The Sunday Herald has been given the
politician's name but, for legal reasons, can not identify the person.

There are still unconfirmed rumours that another senior Labour politician is
among the suspects. The intelligence officer said that a 'rolling' Cabinet
committee had been set up to work out how to deal with the potentially
ruinous fall-out for both Tony Blair and the government if arrests occur.

Full article at:

Clearly a "D Notice" has been slapped on the press in connection with this
person. The fact that the journalist here has seen fit to give us as big a
clue as is possible under the circumstances may be interpreted as licence
for us to speculate by ourselves. Given that the damage to Blair is
potentially quite severe, we can safely assume that this report does not
refer to any ex-Labour cabinet ministers of an earlier vintage
(Wilson/Callaghan era), or that the senior figure in question is not a

In only 6 years there are quite a few ex-Cabinet Ministers kicking around,
but not so many that could be described as high profile. Frank Dobson, for
example, has only recently re-emerged to oppose Alan Milburn's "foundation"
hospital policy, having been severely humiliated in the London mayoral
election fiasco of three years ago. "Dr" Jack Cunningham, never a star
performer, is now too busy with directorships to fill space for hungry
newspaper editors, and his relationship with the nuclear industry is such
that it is better for everyone concerned that he keep his head below the
parapet. Mo Mowlam, since publishing her lightweight memoirs, has not been
heard of at all. Estelle Morris? Forget it.

The biggest two fish that come to mind are indeed high profile: firstly
there is George Robertson, who today has announced that he will step down as
NATO Secretary General after four years and two months in the job. Were he
to be fingered the fall out would be spectacular but short-lived -- he's
been a long time out of the cabinet and is sufficiently distant from Tony to
be regarded as not requiring the presentational finesse of a "rolling"
Cabinet committee, whatever that might be. However, our second candidate is
most certainly very closely identified with the prime minister, and retains
a high profile and, as A-listers will know only too well, continues to
operate at a very high level indeed, whether in Europe, Japan, or even the
Middle East.

Peter Mandelson began political life as a member of the Communist Party,
soon "seeing the light" and instead getting involved with the
CIA/MI6-financed Socialist International youth wing and the Labour Party,
through which he rose in parallel with his experience working at London
Weekend Television with other A-list regulars like John Birt and Michael
Maclay, now public mouthpiece of Hakluyt, the private sector spook outfit
run by a bunch of "ex" MI6 types including the widow of ex-Labour leader
John Smith. This sort of background and connections makes Mandelson very
useful in the sort of corridors-and-alleyways diplomacy and networking that
is the real substance of international relations and intelligence gathering.
As Maclay has explained, the techniques employed by the LWT team in their
"mission to explain" as exemplified by their terminally dull "Weekend World"
current affairs programme were innovative and have been developed and
adapted to other arenas, including of course the eventual "mastery" of the
media that is supposedly the hallmark of New Labour. Mandelson's role as a
campaigns coordinator dates from Neil Kinnock's era of leadership, and
resumed under Blair following the hiatus that marked John Smith's brief
spell (another casualty of that period since returned is Education Secretary
Charles Clarke; Trade and Industry Secretary Patricia Hewitt can also be

If Mandelson is indeed the suspect, then the damage this could cause may
fatally wound Blair. The Labour Party remains the state party, but the
presidential style of Blair means that it is now more important than ever
before that he is seen to retain good judgment -- his personal credibility
is on the line. Having already had to let Mandelson leave the cabinet twice
in the same sitting of Parliament looks very careless. But his retention as
a key adviser and player, while not as noticeable to the general public,
would certainly be exploited by journalists eager to feed on the scandal and
by others eager to discredit whatever initiatives may otherwise benefit from
the presence of Peter, e.g., the pro-European Policy Network.

An interesting development that may, or may not, be related to this, is the
publication of an article in last Sunday's Observer by David Aaronovitch. He
and Mandelson are longtime friends, having been together in the Communist
Party and at London Weekend TV. Aaronovitch was, until recently, a leading
political commentator for the Independent, on whose "international advisory
board" (the standard vanity collection of august persons put together for
the ego of newspaper proprietors like Tony O'Reilly and Conrad Black) sits
Peter Mandelson. Since switching to the Guardian Media Group at the
beginning of this year or thereabouts, Aaronovitch authored an article on
child abuse in which he pleads for common sense to prevail, rather than the
lynch mob:

"Strangely I trust the police to act sensibly (because, like the analysts,
they've seen it all): it's the rest of us I worry about."


That much depends upon the behaviour of the US Justice Department, which
ultimately has responsibility for the investigation, must be a worry for
Blair. One need only imagine how this must colour the views of John Ashcroft
regarding the moral fibre of British cabinet ministers and the laxity of the
prime minister who chose them in the first place. How easy would it be for
the suspect to be named in a story that miraculously surfaced outside of the
UK (thereby circumventing the D Notice and leading potentially to a re-run
of the Spycatcher fiasco of 1987)?

Whoever is on the suspects' list, we can see that already this "rolling"
cabinet committee is busy leaking stories that serve at least to delay the
shock of the inevitable, eventual revelation, buying valuable time if
nothing else. Thus you can depend on the Guardian to save the day for Tony,
here's some helpful tip-offs courtesy of MI6 that help to distract from
what's really going on, whilst bolstering the reputation for integrity and
financial propriety that has marked Blair's dealings with businesspeople
like Bernie Ecclestone, Richard Desmond, Lakshmi Mittal, etc.


How Libya tried to tempt Labour with cash

How Libya tried to tempt Labour with donation

Angelique Chrisafis
Wednesday January 22, 2003
The Guardian

Libya secretly offered a huge donation to the cash-strapped Labour party as
part of its attempts to end its international isolation, the Guardian can
disclose. Ministerial sources say the Libyan proposal was instantly

But a Guardian investigation has uncovered other recent attempts by Libya to
use back channels to get close to Labour politicians.

These include an offer of lucrative deals with the arms company BAE Systems,
and a plan to publish a biography of Colonel Gadafy in Britain.

Libya's offer of an enormous donation came at a time when Labour had a £10m
deficit last September. It originated from Ahmed Gadaff Al Daim, Col
Gadafy's cousin and a senior figure in the regime, and was passed to the
Labour peer, Lord Evans of Temple Guiting, by a London-based businessman,
Wolfgang Michel.

Lord Evans rejected the offer out of hand and informed the party's general
secretary, David Triesman. "The proposal was absolutely ridiculous," said a
Labour source. "Even if foreign donations were not outlawed, we never would
have considered it. The Libyans want to rub shoulders with British
politicians and seemed to think this was a way."

A number of Libya's approaches have been made through Mr Michel. The
German-born 74-year-old, who lives in Chelsea, describes himself as an agent
on hi-tech international deals.

Mr Michel has done business deals with many of the world's most
controversial regimes, including Iraq, Russia and Iran.

According to his associates, Mr Michel sought to arrange a 1998 meeting
between the Libyans and Labour politicians. Libya was secretly offering
£6bn-worth of aviation deals in return for the permanent lifting of

Mr Michel sought to use as an intermediary Matthew Evans, the Labour peer
and former chairman of publishers, Faber and Faber. Lord Evans is Mr
Michel's son-in-law and was recruited to the Blair government in December as
a whip.

Separately, confidential talks did eventually get off the ground between
BAE, Britain's biggest arms manufacturer, UK officials, and Mr Gadaff Al
Daim on behalf of Libya, with meetings in Switzerland and London. But they
remained inconclusive.

The two countries are continuing to edge closer. Last August, the Foreign
Office minister, Mike O'Brien, flew to Tripoli to meet Col Gadafy in the
first such encounter for 20 years.

Sources at Faber and Faber say Mr Michel suggested the firm publish a
biography of Col Gadafy. But Lord Evans told the Guardian he rejected the
deal in September 2001.

"I went to a meeting with Ahmed Gadaff Al Daim who wished to talk about a
biography about his cousin. I made the point it would have to deal with
Lockerbie and the regime's funding of terrorism. After discussion with my
colleagues at Faber, we decided not to pursue the idea."

Mr Michel confirmed that he had raised "a possible publishing opportunity".
But he told us he did it on his own account, "not on behalf of Ahmet Gadaff
Al Daim".

Government sources say Lord Evans has been meticulous in disclosing his
family connections, and that he has kept Wolfgang Michel and his Libyan link
"at arms length". Lord Evans's government job does not involve defence or
international issues, they point out.

Mr Gadaff Al Daim first received unwelcome publicity in 1989, when the
former international call girl Pamella Bordes said she had had a long affair
with him while he was negotiating commercial tie-ups between Libya and the
Italian car firm Fiat.

Mr Gadaff Al Daim, approached through the Libyan embassy in London, last
week did not respond to invitations to comment.

Mr Michel, who said he knew Mr Gadaff Al Daim, cloaks his business affairs
in mystery via a Liechtenstein offshore trust. Records show a UK investment
company ultimately controlled by him - Entera Corporation - has brought into
Britain more than £2m in commissions earned from India. Associates say he
has acted to sell arms on behalf of Russia, but Mr Michel denied this. He
said he had "negotiated legitimate sales of civil aircraft to India". He
points out his commissions include earnings from the export of jute.

Company records show he also has a business link with the French state-owned
aero engine company, Snecma, which powers Mirage fighters, the Airbus, and
Russian trainers. Mr Michel denies he has been their agent.

Questions have been raised as to whether he was involved in negotiations to
sell Mirage fighters to Saddam Hussein in Iraq - a deal promoted by the
French government which collapsed in 1990 when Iraq invaded Kuwait.

Mr Michel said he had visited Iraq once but not in that period. He agreed he
had concluded agricultural deals with the Iranians in the company of such
controversial figures as the Saudi arms dealer Adnan Khashoggi, and the late
tycoon, Tiny Rowland. Mr Michel's lawyer emphasised last week he had not
been involved in any improper or illegal military sales or business

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