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Obama vs. the Brass: Benghazi Cover-up, Agenda to Gut Military?

Written by  William F. Jasper

An awful lot of America’s top military brass have been taking hits lately. Is it just a coincidence that several four-star generals and a two-star admiral get the axe or resign in disgrace within the space of less than a month? Do any of these have anything to do with the administration’s Benghazigate scandal? Or are they, as some military observers suspect, only the first installment of the Obama agenda to decimate the military services?

General David Petraeus, of course, has been at the center of a media storm since his resignation as CIA director on November 9, amid revelations of an extramarital affair with Paula Broadwell, his biographer.

Here is a timeline of recent casualties in the highest echelons of the U.S. military services:

  1. • General Carter Ham — On October 18, Secretary of Defense Leon Panetta announced that Gen. Ham was being replaced as the commander of U.S. Africa Command (AFRICOM). Panetta gave no explanation for Gen. Ham’s removal.
  2. • Rear Admiral Charles Gaouette — On October 28, the commander of the John C. Stennis carrier strike group in the Middle East, was abruptly removed from command and returned to the U.S.
  3. • General David Petraeus — On November 9, General Petraeus, former commander of U.S. forces in Iraq and Afghanistan, resigned as head of the Central Intelligence Agency.
  4. • General John Allen — On November 13, news stories reported that Gen. Allen, who was Gen. Petraeus’s successor in Afghanistan and a top nominee for NATO’s Supreme Allied Commander in Europe, was embroiled in a potential scandal involving emails with Jill Kelley, a socialite at McDill Air Force base. Allen has insisted that there was no improper relationship between himself and Mrs. Kelley, but his career path to the top NATO post has been scotched, and the ongoing investigation could potentially lead to his resignation.
  5. • General William “Kip” Ward — On November 13, Defense Secretary Leon Panetta demoted Gen. Ward, the former head of U.S. AFRICOM, stripping him of his fourth star, following a lengthy DOD Inspector General probe that found Ward guilty of lavish spending and extravagant travel.

The removal of General Ham and the resignation of General Petraeus have particularly stirred widespread concern that both cases may be driven by White House efforts to smother exposure of the administration’s handling of the deadly September 11, 2012 “consulate” debacle in Benghazi, Libya, in which U.S. Ambassador Christopher Stevens and three other Americans were killed (see here and here).

The timing of the resignations, removals, revelations and demotions were bound to spark suspicions of a Benghazi connection, particularly in the case of Gen. Petraeus, who was scheduled to testify this week in congressional inquiries into the deadly Libyan attacks. His resignation put his appearance before the committees in doubt. However, members of Congress have let it be known they expect him to testify.

In a November 12 interview with NBC News, Sen. Dianne Feinstein (D-Calif.), chairman of the Senate Intelligence Committee, said the Obama administration is behaving in an “unacceptable” manner and she is ready to subpoena information it is denying her committee.

“I believe that Director Petraeus made a trip to [Libya] shortly before this became public,” Feinstein said. “I believe that there is a trip report. We have asked to see the trip report. One person tells me has read it. And then we try to get it, and they tell me it hasn’t been done. That’s unacceptable. We are entitled to this trip report, and if we have to go to the floor of the Senate on a subpoena, we will do just that.”

Director Petraeus went to Capitol Hill on September 14 for a closed-door, classified briefing of legislators. During that briefing, it has been reported, he upheld the now-debunked false story that the attack on the U.S. compound in Benghazi had resulted in response to popular outrage over an anti-muslim Internet video.

However, it has also been reported that Petraeus privately stated to one member of Congress, “Do you want the official line or do you want the real truth?”

Today Senator Feinstein announced that Petraeus will be “talking to the committee,” but was unclear as to whether that meant he would be testifying publicly and under oath or just briefing committee members in closed session. “He is very willing and interested in talking to the committee,” Feinstein told reporters today. “It’s just on Benghazi. Our hearings are on Benghazi and the intelligence that preceded Benghazi and the intelligence that determined the security.”

Another big question that has not yet been answered is whether Gen. Carter Ham will be testifying. In defending the administration’s decision not to send aid to the besieged “consulate,” Secretary Panetta claimed that Ham had “very strongly” backed Panetta’s assessment that since the situation on the ground in Benghazi was so uncertain, no attempt should be made to send military assistance to the American personnel who were under attack. However, according to unconfirmed reports, Ham, instead of backing the Obama/Panetta order to “stand down” and let Americans die, had decided to go ahead and launch a rescue effort. Reportedly, he was immediately arrested by his second in command and prevented from initiating the rescue.

If this account is true, then obviously that would be a huge story, with enormous ramifications. Gen. Ham should definitely be called to testify publicly and placed under oath to determine precisely what did transpire the night of September 11-12.

Spiking Benghazi: The Media Fix

There is little doubt that Team Obama was fully aware that the Benghazi disaster could blow up in their faces just as the neck-and-neck presidential was headed into the closing stretch. A CBS News national telephone poll of likely voters conducted October 25-28 did not portend well for Obama. Locked in a dead heat with Mitt Romney, and with the economy in shambles and sliding toward a fiscal cliff, the Obama White House could ill afford a late-inning foreign policy disaster, especially when Obama propagandists were touting foreign policy and national security as their candidate’s great strength.

According to the CBS poll, only 38 percent of voters approved of President Obama’s handling of the September 11 attack on the U.S. mission in Benghazi. Over half of all voters (51 percent) disapproved. And an even higher 57 percent of the crucial independent voters disapproved of his handling of Benghazi. And those negatives had developed with all of the major media faithfully retailing the White House talking points on Benghazi and steadfastly censoring any reports that challenged the crumbling administration narrative. Genuine journalistic digging and real news reporting would have been a game changer in the tight presidential race.

The Media Research Center (MRC) reported on November 1:

  • For the sixth night in a row, ABC World News, CBS Evening News, and NBC Nightly News refused to give one single second of coverage to a Fox News report that the Obama Administration denied help to those attacked and killed by terrorists at the US consulate in Benghazi on September 11. According to a Media Research Center analysis, ABC, CBS, and NBC have failed to cover this devastating story — not to confirm it, not to knock it down, and never mind do their own investigation. The story broke last Friday, long before Hurricane Sandy swamped the news cycle.
  • Further, neither The Washington Post nor The New York Times has committed a single inch of their newspapers to a news story about this report.
  • According to Fox News, “sources claim officers at the nearby CIA annex in Benghazi were twice told to stand down when they requested to help those at the consulate. They later ignored those orders. Fox News was also told that a subsequent request for back-up when the annex came under attack was denied as well.”

“The liberal ‘news’ media’s refusal to cover this story exposes how corrupt they have become,” declared Media Research Center President Brent Bozell. “Four Americans died in Libya in a coordinated terrorist attack on the anniversary of 9/11. The Obama Administration has been caught in a maze of falsehoods. This reeks of a cover-up. This scandal could and would derail the Obama re-election efforts. ABC, CBS, NBC, The Washington Post, and the New York Times are so vested in the re-election of Barack Obama that they are deliberately spiking this huge story. It’s sickening.”

Mr. Bozell continued:

  • The Obama administration’s cover-up of their deceitful response to the Benghazi terrorist attack is without a doubt the biggest political news story of 2012. The American people have a right to know what really happened before they cast their ballots on Election Day.
  • If ABC, CBS, NBC, The Washington Post, and the New York Times refuse to ask the tough questions, then they no longer serve any purpose. And if they’re sitting on evidence to help Obama win re-election, they’re as guilty in this cover-up as is the administration.

As the Media Research Center pointed out in a previous analysis, while the major media were spiking the Benghazi story, they were lavishing friendly coverage on President Obama and swamping viewers with celebrity gossip and buzz on the latest consumer gizmos and Hollywood releases.
And, of course, one of the most blatant examples of the media covering for Obama was the spectacle put on by CNN’s Candy Crowley in the second Presidential debate, where she shamelessly dropped her supposedly neutral role as moderator to take over and respond to Mitt Romney’s challenges to Obama regarding Benghazi.

Decimating the Military: Obama’s “Night of the Long Knives”?

While the cashiering of CIA Director General Petraeus and AFRICOM commander General Ham certainly suggest a connection to the administration’s ongoing heavy-handed effort to keep the Benghazi disaster from developing into a post-election crisis for the White House, the other aforementioned military resignations and demotions may be signaling something even bigger.

A number of political and military analysts interviewed by The New American believe the Obama administration is in the process of “purging” the U.S. Armed Services, and that we will see a much larger number of line officers removed for various scandals, especially those deemed “politically incorrect,” or those who may be occupying a post that the Obama administration wants to open up for a more “progressive” candidate.

Some are predicting that the bloodletting in the ranks thus far is but the opening salvo in Obama’s “Night of the Long Knives,” a reference to Adolph Hitler’s murderous purge of Ernst Rohm and other Nazis, as well as non-Nazi political opponents whom he saw as obstacles to his consolidation of dictatorial power.

New Zealand researcher Trevor Loudon, author of Barack Obama and the Enemies Within, and editor of the highly acclaimed New Zeal blog at TrevorLoudon.com, told this writer during an interview two weeks before the election:

  • It’s very clear that President Obama, Hillary Clinton, and many of those around them absolutely “loathe the military,” as Hillary once put it. [Defense Secretary] Panetta, while he was a congressman, was very heavily involved with the Institute for Policy  Studies, a very radical Marxist think tank, which supported the Soviet objective of subverting and eviscerating the U.S. military services. Panetta, together with David Axelrod, Valerie Jarrett, Susan Rice, and others in the administration, really do see the U.S. military, as it currently is, as the enemy.

Former Navy SEAL Steve Elson echoes that assessment. “President Obama and the people running his administration really do hate the military,” Elson told The New American. “It’s not just that they ‘don’t understand the military culture,’ [as some critics claim]; they really just don’t like us. In fact they hate us.” Elson continued:

They’re fine with using us, sending us all over the world whenever it works to score political points for them. They don’t mind getting us killed, sending us out with treasonous ROEs [rules of engagement], as in Iraq and Afghanistan, where soldiers and marines were ordered stand guard, go into hostile zones without loaded weapons. Or, as in Benghazi, they cowardly sit in the Pentagon and the White House watching and doing nothing while brave men die.

  • Too many of the top brass are playing the political correctness game when they should be refusing to carry out these immoral and traitorous orders. In the end, it didn’t help Petraeus either. He played their games and went along with their political correctness, and look where it got him. Fine, he deserved it, as far as I’m concerned. But the guys that are out there with their lives on the line don’t [deserve it]. As you can see, I’m anything but politically correct, but I’m only saying out loud what most active duty soldiers will tell you privately. Obama and those running his administration will destroy the U.S. military, if the American people let him, if they don’t wake up to what he is doing.

Related articles:

Petraeus Resignation Suggests Possible White House Cover-Up
The Other Petraeus Scandal: Accelerated Militarization of the CIA
Benghazi Backfire: Was Obama Arming Jihadists?
Did Obama Watch in “Real Time” as Benghazi Attack Unfolded?
The Trouble With Leon Panetta
Leon Panetta and the Institute for Policy Studies

Book Review: Barack Obama and the Enemies Within

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Why Did Obama Deny Military Help for Benghazi?

Submitted by may on October 28, 2012 – 12:44am

From the evidence thus far, it appears that the decisions to deny military help to the US Consulate in Benghazi and subsequently to the CIA safe house was made by President Obama.

The Obama Administration tired to shift the blame to the CIA for the lack of military support for the US Consulate and the CIA safe house.  A CIA spokeswoman denied that requests for help had been turned down by the CIA, implying the decision was made by President Obama,

CIA spokeswoman Jennifer Youngblood, though, denied the claims that requests for support were turned down.

“We can say with confidence that the Agency reacted quickly to aid our colleagues during that terrible evening in Benghazi,” she said. “Moreover, no one at any level in the CIA told anybody not to help those in need; claims to the contrary are simply inaccurate.  In fact, it is important to remember how many lives were saved by courageous Americans who put their own safety at risk that night-and that some of those selfless Americans gave their lives in the effort to rescue their comrades.”

General David Petraeus, Director of the Central Intelligence Agency, has made no comments on what happened in Benghazi.  Petraeus has not appeared on any news broadcasts and has given no interview.  Petraeus will not lie for Obama.  Breitbart has reported that Petraeus has denied that the CIA was the agency denying help to those requesting it in Benghazi.

Central Intelligence Agency director David Petraeus has emphatically denied that he or anyone else at the CIA refused assistance to the former Navy SEALs who requested it three times as terrorists attacked the U.S. consulate in Benghazi on the night of Sep. 11. The Weekly Standard and ABC News report that Petraeus’s denial effectively implicates President Barack Obama, since a refusal to assist “would have been a presidential decision.”

Earlier today, Denver local reporter Kyle Clarke of KUSA-TV did what the national media largely refuses to do, asking Obama directly whether the Americans in Benghazi were denied requests for aid. Obama dodged the question, but implied that he had known about the attacks as they were “happening.”

Emails released earlier this week indicated that the White House had been informed almost immediately that a terror group had taken responsibility for the attack in Benghazi, and Fox News reported this morning that the two former Navy SEALs, Ty Woods and Glen Doherty, had been refused in requests for assistance they had made from the CIA annex.

Jake Tapper quoted Petraeus this afternoon denying that the CIA was responsible for the refusal: “No one at any level in the CIA told anybody not to help those in need; claims to the contrary are simply inaccurate.”

The Breitbart report continued,

As William Kristol of the Weekly Standard notes, that leaves only President Obama himself to blame:

So who in the government did tell “anybody” not to help those in need? Someone decided not to send in military assets to help those Agency operators. Would the secretary of defense make such a decision on his own? No.

It would have been a presidential decision. There was presumably a rationale for such a decision. What was it? When and why—and based on whose counsel obtained in what meetings or conversations—did President Obama decide against sending in military assets to help the Americans in need?

Why would President Barack Obama deny military support to the US Consulate in Benghazi and subsequently deny support to the CIA safe house?

Did Obama want to conceal the fact the attack was conduced by al-Qaeda terrorists?  Would this have interfered with Obama’s claim that al-Qaeda is vanishing since the killing of Osama bin Laden?

Was the Terrorist attack in Benghazi organized by Iran or Syria in retaliation for President Obama and Ambassador running guns into Syria and placing the weapons in the hands of Assad?  Was Obama afraid of starting a war with Iran or even with Russia?

Did President Obama want Ambassador Stevens killed because Stevens knew too much?  Were Stevens and Obama running guns to al-Qaeda in Syria much like Holder and Obama were running guns to drug cartels in Mexico with operation Fast and Furious?  Did Obama think allowing al-Qaeda to assassinate Stevens would put the lid on the Syrian gun running operation before it could become a scandal just before the General Election?

Congress and other responsible investigators must ask these difficult questions.  If President Barack Obama, Secretary of State Hillary Clinton, and others are innocent, they need to be cleared of suspicion.  I suspect the final answers regarding the involvement of President Barack Obama and others in the Obama Administration will shock our nation.

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U.S. Taxpayers Subsidize Afghan Insurgents

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 May 8, 2012 @ 9:22 am
by Malou Innocent

Less than a week after President Barack Obama made a surprise visit to Afghanistan and proclaimed, “We broke the Taliban’s momentum,” the chairs of the Senate and House intelligence committees offered a candid assessment of the U.S. mission. Senator Dianne Feinstein (D-CA), alongside Representative Mike Rogers (R-MI), said on CNN’s “State of the Union,” “I think we’d both say that what we found is that the Taliban is stronger.” Their observations are the type of unvarnished truth that our military and civilian leaders typically avoid. U.S. and NATO officials meeting in Chicago later this month should take heed, especially since American taxpayer dollars are helping to fund the insurgents we’re fighting.

In a not-much publicized report last August from the Commission on Wartime Contracting in Iraq and Afghanistan, researchers found that after the illegal opium trade, the largest source of funding for the insurgency was U.S. contracting dollars. It found that Afghan companies under the Host Nation Trucking program use private security contractors who then turn around and pay insurgents and warlords who control the roads we must use. Although the Commission on Wartime Contracting report did not mention how much was funneled to the insurgency, a similar protection racket was also uncovered a couple of years ago.

Task Force 2010, assembled by General David Petraeus, examined the connections between insurgents and criminal networks on the one hand and Afghan companies and their subcontractors for transportation, construction, and other services on the other. The task force estimated that $360 million in U.S. tax dollars ended up in the hands of insurgents and other “malign actors,” including criminals, warlords, and power-brokers.

The $360 million “represents a fraction of the $31 billion in active U.S. contracts that the task force reviewed,” Associated Press reporters Deb Riechmann and Richard Lardner explained. As Brussels-based International Crisis Group observed in a depressingly frank June 2011 report:

Insecurity and the inflow of billions of dollars in international assistance has failed to significantly strengthen the state’s capacity to provide security or basic services and has instead, by progressively fusing the interests of political gatekeepers and insurgent commanders, provided new opportunities for criminals and insurgents to expand their influence inside the government. The economy as a result is increasingly dominated by a criminal oligarchy of politically connected businessmen.

Is it any wonder why pouring massive piles of cash into a broken and war-ravaged system resulted in failure? Those who follow the news from Afghanistan will see how rent-seeking inadvertently strengthens that country’s twin evils: corruption and insecurity. As journalist Douglas A. Wissing writes in his eye-opening new book, Funding the Enemy: How U.S. Taxpayers Bankroll the Taliban, in addition to foreign development advisers preoccupied with their own career advancement, development money itself was not countering the insurgency but rather paying for it. Combined with an enemy whose strategy was always about exhaustion, the result has been catastrophic.

Wissing writes, “I learned that the linkage between third-world development and US national security that foreign-aid lobbyists peddled to American policymakers was a faith-based doctrine with almost no foundation in research.” Year after year, the American public was spoon-fed government reports that lacked honesty about why our top-down security and development programs were constantly failing. Buildings were poorly constructed. Projects were bereft of proper oversight. Schools were built without teachers to staff them. Road construction contracts financed insurgent racketeering operations.

The undistorted evidence of a European-based think tank, a bipartisan congressional commission, and a report from military experts, assembled by the war’s former commander, leads to one conclusion: the war is inadvertently throwing American taxpayer dollars at insurgents killing American troops. What about this self-aggrandizing system is making Americans safer? Moreover, what about the safety of the Afghans whom planners in Washington swore to protect from the Taliban? In spite of the tripling of U.S. troops since 2008, a recent report by the U.N. mission concluded that 2011 was the fifth straight year in which civilian casualties rose.

As Feinstein said to CNN on Sunday, “The Taliban has a shadow system of governors in many provinces. They’ve gone up north. They’ve gone to the east. Attacks are up.” After over a decade of inadvertently funding the enemy and alienating the local people, Americans should not be surprised with such a dire outcome. If anything, they should be surprised that their elected leaders are finally telling the truth.

Cross-posted from the Skeptics at the National Interest.

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The Oil and the Glory: Year of the Pipeline

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Year of the pipeline: Time magazine’s Person of the Year is the protester, and that is probably valid, but we think that the editors missed an important also-ran — the pipeline. Few care to stop and notice the elegance in unsung lengths of steel cylinders stirring fierce passions such as nationalism, greed and tear-inducing anger. We are talking the 24- and 36-inch steel cylinders that carry oil and gas across continents, under bodies of water and over mountains to the 7 billion people of the Earth. Who for instance considered nominating the Keystone Pipeline as political instrument of the year for how it threatened to shut down the whole of the U.S. government, and may yet in the coming couple of months? Then there is Nabucco, a proposed natural gas line that has much of Europe, Russia along with the U.S. tied up in sanctimonious knots over who will exercise geopolitical and economic leverage in Europe. This week Russia notched up the temperature by securing crucial support from Turkey for its repost to Nabucco, a pipeline that it calls South Stream. That battle also will carry over into the new year. And who can forget the proposed trans-Afghanistan gas pipeline, known by the acronym TAPI? A powerful and high-kicking chorus is backing TAPI, led by Secretary of State Hillary Clinton and CIA director David Petraeus, who embraced the line when he was running the ground game as a general in Afghanistan. Observers, including this blog, have cast doubt on TAPI’s feasibility given Afghanistan’s chaos. Yet we celebrate it as a worthy addition to this improbable pantheon — inanimate objects that somehow transmogrify into organic, breathing beings capable of arousing high-stakes emotion in humans.

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Brace Yourselves

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Erik Swarts, Market Anthropology

“Tell me how this ends,” U.S. General David Petraeus asked memorably of the 2003 invasion of Iraq.

Political leaders and economists in the euro zone are searching frantically for answers to the same question as a bond market rout of European sovereign debt accelerates, putting the future of the single currency in jeopardy.

Until a few weeks ago, the most likely outcome appeared to be that the 17-nation currency area would muddle through. The euro zone would bail out a few highly indebted small peripheral states, patch up its rickety fiscal governance and avoid either a break-up or a major shift toward federal integration.

That was then. Now it seems that without a radical game-changing initiative within weeks, the crisis may no longer be controllable. – Tighter euro zone gains ground as debt crisis exit, Reuters

Here is an update of the SPX Meridian Market Theory chart that I have been following throughout the year. In my last update – I was opportunistic in the mindset that the charts may have been pointing towards an approaching long-term low. And while we found a low a few weeks later, I now find myself reinterpreting (in light of what I have found in the charts and the data from Europe and Asia) what the most recent rejection may mean towards the market going forward.

You may say I am becoming more concerned as the market has double and tripled dipped the same positive news out of Europe.

Near term, in either case – bull or bear, I find the market precariously placed at the top of the range and likely to fall back swiftly over the balance of the month.

Charts & More – The Money Game

Market Anthropology

The son of Africa claims a continent’s crown jewels

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On 14 October, President Barack Obama announced he was sending United States special forces troops to Uganda to join the civil war there. In the next few months, U.S. combat troops will be sent to South Sudan, Congo and Central African Republic. They will only “engage” for “self-defense”, says Obama, satirically. With Libya secured, an American invasion of the African continent is under way.

Obama’s decision is described in the press as “highly unusual” and “surprising”, even “weird”. It is none of these things. It is the logic of American foreign policy since 1945. Take Vietnam. The priority was to halt the influence of China, an imperial rival, and “protect” Indonesia, which President Nixon called “the region’s richest hoard of natural resources …the greatest prize”. Vietnam merely got in the way; and the slaughter of more than three million Vietnamese and the devastation and poisoning of their land was the price of America achieving its goal. Like all America’s subsequent invasions, a trail of blood from Latin America to Afghanistan and Iraq, the rationale was usually “self defense” or “humanitarian”, words long emptied of their dictionary meaning.

In Africa, says Obama, the “humanitarian mission” is to assist the government of Uganda defeat the Lord’s resistance Army (LRA), which “has murdered, raped and kidnapped tens of thousands of men, women and children in central Africa”. This is an accurate description of the LRA, evoking multiple atrocities administered by the United States, such as the bloodbath in the 1960s following the CIA-arranged murder of Patrice Lumumba, the Congolese independence leader and first legally elected prime minister, and the CIA coup that installed Mobutu Sese Seko, regarded as Africa’s most venal tyrant.

Obama’s other justification also invites satire. This is the “national security of the United States”. The LRA has been doing its nasty work for 24 years, of minimal interest to the United States. Today, it has few than 400 fighters and has never been weaker. However, U.S. “national security” usually means buying a corrupt and thuggish regime that has something Washington wants. Uganda’s “president-for-life” Yoweri Museveni already receives the larger part of $45 million in U.S. military “aid” – including Obama’s favorite drones. This is his bribe to fight a proxy war against America’s latest phantom Islamic enemy, the rag-tag al Shabaab group based in Somalia. The RTA will play a public relations role, distracting western journalists with its perennial horror stories.

However, the main reason the U.S. is invading Africa is no different from that which ignited the Vietnam war. It is China. In the world of self-serving, institutionalized paranoia that justifies what General David Petraeus, the former U.S. commander and now CIA director, implies is a state of perpetual war, China is replacing al-Qaeda as the official American “threat”. When I interviewed Bryan Whitman, an assistant secretary of defense at the Pentagon last year, I asked him to describe the current danger to America. Struggling visibly, he repeated, “Asymmetric threats … asymmetric threats”. These justify the money-laundering state-sponsored arms conglomerates and the biggest military and war budget in history. With Osama bin Laden airbrushed, China takes the mantle.

Africa is China’s success story. Where the Americans bring drones and destabilization, the Chinese bring roads, bridges and dams. What they want is resources, especially fossil fuels. With Africa’s greatest oil reserves, Libya under Muammar Gaddafi was one of China’s most important sources of fuel. When the civil war broke out and NATO backed the “rebels” with a fabricated story about Gaddafi planning “genocide” in Benghazi, China evacuated its 30,000 workers in Libya. The subsequent UN security council resolution that allowed the west’s “humanitarian intervention” was explained succinctly in a proposal to the French government by the “rebel” National Transitional Council, disclosed last month in the newspaper Liberation, in which France was offered 35 per cent of Libya’s gross national oil production “in exchange” (the term used) for “total and permanent” French support for the NTC. Running up the Stars and Stripes in “liberated” Tripoli last month, U.S. ambassador Gene Cretz blurted out: “We know that oil is the jewel in the crown of Libyan natural resources!”

The de facto conquest of Libya by the U.S. and its imperial partners heralds a modern version of the “scramble for Africa” at the end of the 19th century.

Like the “victory” in Iraq, journalists have played a critical role in dividing Libyans into worthy and unworthy victims. A recent Guardian front page carried a photograph of a terrified “pro-Gaddafi” fighter and his wild-eyed captors who, says the caption, “celebrate”. According to General Petraeus, there is now a war “of perception … conducted continuously through the news media”.

For more than a decade the U.S. has tried to establish a command on the continent of Africa, AFRICOM, but has been rebuffed by governments, fearful of the regional tensions this would cause. Libya, and now Uganda, South Sudan and Congo, provide the main chance. As WikiLeaks cables and the U.S. National Strategy for Counter-terrorism reveal, American plans for Africa are part of a global design in which 60,000 special forces, including death squads, already operate in 75 countries, soon to be 120. As Dick Cheney pointed out in his 1990s “defense strategy” plan, America simply wishes to rule the world.

That this is now the gift of Barack Obama, the “Son of Africa”, is supremely ironic. Or is it? As Frantz Fanon explained in Black Skin, White Masks, what matters is not so much the color of your skin as the power you serve and the millions you betray.

John Pilger is an Australian journalist and documentary maker, based in London. He has twice won Britain’s Journalist of the Year Award, and his documentaries have received academy awards in Britain and the U.S.

by John Pilger

(WWW.Johnpilger.com)

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J.P. Morgan’s hunt for Afghan gold

A team of bankers starts to tap the country’s vast mineral riches, with help from the Pentagon.

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By James Bandler, editor-at-large
May 11, 2011: 5:00 AM ET

FORTUNE — Qara Zaghan, Afghanistan: The four Black Hawk helicopters sweep down on this remote river valley, flying fast and single file. Snow covers the mountains’ peaks, but the lower slopes look like rust — dry, rocky, and bare. As we bank around the river bend, we see our first flash of green in the fields below and then the rectangular mud huts of the village, where hundreds of Afghans mass to greet us.

“That’s the mine over there,” one of my companions says, pointing to the cliffs rising above the village.

That’s it? That’s the gold mine? It doesn’t look all that different from the forbidding country we’ve been traversing: just another pile of rocks and scree. The jet-lagged man in the seat across from me knows better. His sleepy eyes are suddenly alert. If anyone can wrest a fortune from Afghanistan’s rubble, it is this man, Ian Hannam.

Arriving in a developing nation with his iPad and his enigmatic smile, Hannam personifies the soft side of Western power. He doesn’t bend people to his will with weapons or threats. But there is no mistaking the dealmaker’s impact: In his wake, mountains are razed, villages electrified, schools built, and fortunes made.

To Hannam, chairman of J.P. Morgan Capital Markets, Afghanistan represents a gigantic, untapped opportunity — one of the last great natural-resource frontiers. Landlocked and pinioned by imperial invaders, Afghanistan has been cursed by its geography for thousands of years. Now, for the first time, Hannam believes, that geography could be an asset. The two most resource-starved nations on the planet, China and India, sit next door to Afghanistan, where, according to Pentagon estimates, minerals worth nearly $1 trillion lie buried. True, there is a war under way. And it’s unclear how the death of Osama bin Laden will impact the country’s political and economic environment. But Hannam is not your usual investment banker: A former soldier, he has done business in plenty of strife-torn countries. So have all the members of his team, two of them former special forces soldiers who have fought here.

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Attending the ribbon cutting were (from left) mine owner Sadat Naderi; Mining Minister Wahidullah Shahrani; J.P. Morgan's Ian Hannam; and (behind Hannam) investor Pairoj Piempongsant.

As he flies to the mine for the ribbon-cutting ceremony, Hannam thinks back over the past 12 months. This little mine, where operations have yet to commence, is puny by J.P. Morgan’s (JPM) standards, but he knows it might be the project for which he is remembered. A lot of powerful people, including the commander of U.S. forces in Afghanistan, Gen. David Petraeus, are counting on him to demonstrate that the country is safe for foreign investors. Hannam has chafed at times under the pressure from the Pentagon, and the cold-eyed realist in him wonders whether unrealistic expectations are being placed on this business venture.

Hannam ducks his head and climbs out of the chopper, necktie flapping in the prop wash. As he trudges up the hill, even the jaded, 55-year-old banker seems swept away by the pageantry of the moment: the village elder in a ceremonial robe, the silhouettes of women watching from the ridges, the saluting Afghan soldier. Hannam is enveloped in a crush of local tribesmen chattering excitedly in Dari. One of them puts a garland around his neck. Another hands him a Ziploc bag containing a chunk of Afghan gold. A mullah utters prayers. Afghanistan’s minister of mining gives a long speech.

Hannam and his local partner, Sadat Naderi, walk up the hill to pose for photographs. Naderi points to a narrow band of quartz that runs in an east-west line across the cliff side. It shimmers in the sun. That is the treasure, he says.

“Unless,” Hannam mutters, “it’s fool’s gold.”

Absurd risks vs. amazing rewards

Investing in conflict zones is often thrilling, but the great commodities rush that J.P. Morgan and the Pentagon are trying to spark in Afghanistan creates a risk/reward equation of a different magnitude. It’s extreme at both ends.

When J.P. Morgan launched its Afghan initiative in 2010, violence was at its worst since the American-led occupation began in 2001. The Taliban have made a point of killing Westerners and have specifically said they would attack any companies involved in mining. Before our trip to the mine was done, our group would get a taste of the insurgents’ ability to strike violently and unpredictably.

Then there’s the Afghan infrastructure — or rather, there isn’t. Big mines need power, lots of it. Outside of cities, only 15% of Afghanistan is electrified. The mountain roads — ungraded and often without guardrails — are perilous, I learned the hard way, particularly in winter. Seat belts? No one bothers. You crash, you die.

If the brutal war and roads don’t give a businessperson pause, the country’s governance and corruption problems should. Massive fraud marred recent elections. Transparency International rates Afghanistan as the second most corrupt country on earth after Somalia. The last minister of mining was identified in a Washington Post report as the recipient of a massive bribe, an allegation he denied to Fortune. The current minister, who had been widely described as an honest reformer, has recently had his integrity questioned in State Department cables released by WikiLeaks. He, too, told Fortune he has done nothing improper.

But if the risks are absurd, the potential rewards are off the charts. Hundreds of billions of dollars’ worth of iron, copper, rare earth metals, and, yes, gold are buried beneath Afghanistan’s deserts and mountains. This wealth has lain there mainly undisturbed for thousands of years as armies of Persians, Greeks, Mongols, Britons, Russians, and now Americans tramped above. Invaders have dreamed of exploiting it since the time of Alexander the Great, but no one has yet succeeded on a large scale.

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A Chinese company is trying to start a copper operation in strife-torn Logar province, but actual mining is years away.

In an 1841 article in a journal of Asiatic studies, Capt. Henry Drummond, a member of the British 3rd Bengal Light Cavalry, described his rambles through the wildest parts of Afghanistan to conduct the first Western mineral survey of the country. He found “abundant green stains” of copper, some of which rivaled the deposits of Chile, and veins of iron ore that “might no doubt be obtained equal to the Swedish.” While many of his countrymen viewed Afghanistan as an untamable place, where a man could not stray many yards from his home or tent without risk of being murdered, Drummond was smitten. Mining, he felt — not the gun — offered the best hope to pacify the territory and win over Afghans.

“Give them, however, but constant employment, with good wages and regular payment; encourage a spirit of industry, both by precept and example; let strict justice be dealt out to them without respect of persons; and we shall shortly see their swords changed into plowshares, industry take place of licentiousness, and these people be converted into peaceable and useful subjects,” Drummond wrote. But the Afghans weren’t keen on the idea of handing over their minerals to occupiers, or on the British occupation itself, for that matter. A year later they massacred the entire British army, save one English survivor, at Gandamak.

During the Cold War, both Soviet and U.S. geologists conducted surveys. The Russians bored thousands of test holes and identified big deposits of copper, zinc, mercury, tin, fluorite, potash, talc, asbestos, and magnesium. But instability in the countryside put an end to serious mining exploration.

After the toppling of the Taliban by the U.S.-led coalition, the Afghan government, with financial assistance from the U.S. Agency for International Development, commissioned new, high-tech aerial surveys of Afghanistan. The results were stunning: The U.S. Geological Survey identified huge veins of copper, iron, lithium, gold, and silver. The Afghan government solicited bids for one of the biggest of the copper deposits, a site south of Kabul that had been identified by both Drummond and the Soviets. China, offering a rich price, won the bid in 2007, beating out four other mining companies. But the Chinese mining company has yet to extract any copper from the site because of delays clearing land mines from the area, and the discovery of archeological relics.

Then, in 2009, mining in Afghanistan got the push it needed — from the U.S. military. Petraeus had been appointed commander of U.S. Central Command, which had ultimate authority over Afghanistan. He realized that a U.S. exit from Afghanistan depended on getting the country’s economy running. Up to 60% of Afghanistan’s $15 billion GDP comes from foreign aid, according to Pentagon estimates, and another 20% comes from the illicit drug trade — poppies. What Afghanistan needed was the real hope that it might achieve economic sovereignty. “I’m an old economist,” the general says in an interview at his headquarters in Kabul. “And at the end of the day this is about progress for the [Afghan] people and giving them the prospect for a much brighter future for them and their families. That’s what persuades the citizenry to support the government rather than support the Taliban.”

Realizing that conventional foreign-aid organizations weren’t getting the job done, Petraeus moved a crack economic stabilization team from Iraq into Afghanistan. That team quickly realized that mining would be key.

Enter Ian Hannam.

“This is the time in Afghanistan for the adventure venture capitalists — for those who can do business in tough places in the world,” Petraeus says.

From special forces to making billionaires

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Villagers at Qara Zaghan hope mining will bring jobs, electricity, schools, and a health clinic.

Ian Charles Hannam seemed bound for a swashbuckling career at an early age. Raised in a working-class neighborhood in South London, the son of a council worker who oversaw a housing and street-repair crew, Hannam grew up knowing that nothing would ever be handed to him. He joined the Territorial Special Air Service at age 17, one of the younger men to pass the service’s grueling selection process.

Hannam’s unit, the Artists Rifles, was a part-time regiment akin to a U.S. National Guard special forces unit. The Artists Rifles had a storied past and a reputation for attracting adventure seekers from all social classes. Since then, Hannam has counted his old SAS cronies as his closest friends, often calling on them to help him in the world’s tougher places.

While serving in the Artists Rifles, Hannam pursued a degree in civil engineering from England’s top school in that field, Imperial College. Upon graduation in 1977, he took a job with Taylor Woodrow, a large British construction firm. His first assignment was to build roads, radar stations, and airstrips in Oman for the SAS, which was in the final stages of crushing a Marxist-led insurgency that had been boiling in the Dhofar region for more than a decade. The experience convinced Hannam that revolts could be beaten with a counterinsurgency program that emphasized developing a country’s infrastructure and natural resources.

Still working for Taylor Woodrow, Hannam went to Nigeria and then back to Oman. Living in a tent, he could not help noticing how well oil-company executives lived. That’s when he decided to go to business school and become rich.

After graduating from the London Business School, Hannam got a job in 1984 in the training program at Salomon Brothers in New York. At the airport on his way home to London for Christmas that year, he was detained by immigration officials because he had no U.S. entry stamp on his passport. The reason: He had parachuted into the U.S. with an SAS unit that was training with American special forces, and then traveled to New York to start the training program.

With a work ethic that former colleagues describe as ferocious and an engineer’s taste for understanding complex financial mechanisms, Hannam was fast-tracked to the bank’s vaunted debt syndicate desk. “His embrace of complexity and change, his indifference to organizational hierarchy and abundant self-confidence born of experience set him apart,” recalls Terry Fitzgerald, founder of Longbow Capital Partners, who was at Salomon with Hannam.

When Salomon was hired to advise media baron Robert Maxwell’s Mirror Group during its public offering, Hannam was one of Salomon’s lead bankers charged with marketing the IPO. Salomon lost money on the deal. Months later Maxwell died and Mirror Group collapsed amid investigations into accounting fraud and raids on its pension fund.

Hannam left Salomon soon after the fiasco and was hired by merchant bank Robert Fleming, a Scottish firm founded by the grandfather of James Bond creator Ian Fleming. By 2000, Hannam was the highest-paid employee at Fleming, making more than the CEO. After the bank was acquired by J.P. Morgan, much of Fleming’s staff was laid off. Not Hannam. He helped engineer a joint venture with, and eventual takeover of, venerated British banking house Cazenove.

Among the old guard at Cazenove — which was subsumed by J.P. Morgan, though the British franchise still bears its name — Hannam was regarded as a bit of a barbarian. He bragged about his wealth. He had appalling table manners. “I’ve got more degrees than I can count, but I still talk like I’m illiterate, and my colleagues hate me for it,” he’d say.

From Congo to Colombia, from Iraq to Sierra Leone, Hannam and his small team of soldiers-turned-bankers and advisers did business with oligarchs, gem dealers, and former mercenaries. He could be bracingly direct. When he landed in Baghdad for a meeting with Iraq’s oil minister, the minister asked, “What are you here for?”

“I’m here to make five new Iraqi billionaires every year for the next 10 years,” Hannam said with a twinkle in his eyes. It was an effective icebreaker, recalled his friend Richard Williams, a former SAS commander who is now CEO of the Afghan gold mine. “They’re all thinking, ‘How can I be one of those?’ Which is not a question that a minister should be thinking.” However crude, Hannam’s point — it would be Iraqis, not Westerners, who were getting rich — worked.

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At an emerald mine high above the Panjshir Valley, work is done by kerosene lantern.

Over the years Hannam had starring roles in a string of huge deals, including the combination of BHP and Billiton (BHP) and its listing on the London exchange, the creation of mining group Xstrata, and the formation of Kazakh commodities giant Kazakhmys. In 2007, Hannam’s appetite for risk and intrigue nearly sank him. A group of Omani investors had hired him to explore the possibility of a leveraged buyout and breakup of Dow Chemical. Hannam and another top J.P. Morgan executive held clandestine meetings with two Dow Chemical executives at the Compleat Angler, a luxury hotel on the bank of the Thames.

The only problem: Dow’s CEO had no idea that the meeting was taking place. The scandal attracted front-page notice around the world.

In 2008, Hannam was passed over for the top job at Cazenove in favor of an outsider. Hannam flew to New Zealand for two weeks, turned off the phone, and brooded. But he decided to stay at the bank, and soon he was doing multibillion-dollar deals again, including lead work on the recapitalization of HSBC. With a job that paid bonuses as high as 10 million pounds, Hannam had come a long way from his boyhood in Bermondsey. He had a wife and three children, a townhouse in Notting Hill, a wild game preserve in the Stormberg mountains of South Africa, and a 230-acre estate in Vermont. But the council worker’s son was hungry for something bigger.

In 2009, at a dinner in Baghdad, he met the man who would give him his chance. The name of their meeting place was fitting for a rendezvous that would help touch off a 21st-century version of the Great Game: the Baghdad Hunting Club.

Hannam was at the banquet hall for a reception thrown by the Trade Bank of Iraq to honor J.P. Morgan. Also at the reception was Paul Brinkley, a deputy under secretary of defense charged with jump-starting Iraq’s stalled economy. A former tech company executive, Brinkley served as a matchmaker of sorts between Iraqi entrepreneurs and foreign businessmen. With the blessing of Defense Secretary Robert Gates, he operated outside normal bureaucratic channels, eschewing the bulletproof vests and helmets his civilian colleagues wore in combat zones. In three years he had secured some $8 billion in private investment contracts for Iraq, helping start textile mills, cement factories, and electronics companies. Hannam and Brinkley had heard about each other’s work. J.P. Morgan had been one of the first Western companies to plant the flag in Iraq, overseeing the country’s currency and setting up a big oil project in Iraqi Kurdistan. Hannam and Brinkley fell into conversation about Afghanistan, which was to be Brinkley’s next posting.

“I’ve got a problem in Afghanistan,” Hannam remembers Brinkley saying. Brinkley was talking to the right man.

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Soon they were having more meetings, in New York and Washington. Brinkley wanted to know what it would take to get the big international mining companies into Afghanistan. Hannam said it was too early. The giants weren’t likely to leap into Afghanistan until smaller, wildcat operators went first. Copper and iron-ore mines were complicated and required huge infrastructure investments: railroads, roads, power plants, and smelters. Hannam said the first project should be less ambitious. A gold or lithium mine would be perfect. These materials could be transported by helicopter or trucked out by road. Hannam and Brinkley agreed that any such project should be led by an Afghan, lest it be seen as part of a resource grab by foreigners. Hannam pledged to bring entrepreneurial support, technical expertise, and capital. “And I’ll make some Afghans very rich, by the way,” he added.

In February 2010, Hannam flew to Kabul to see the situation on the ground. Brinkley took him to a reception at the American ambassador’s home. There, Hannam met an Afghan businessman named Sadat Naderi. British educated, smooth, and brimming with energy and ambition, Naderi ran a diversified company that included insurance, logistics, and supermarkets. There was one other thing, he said: “I’m one of the first Afghans that has actually won a gold license.”

Hannam’s eyes lit up. Naderi, it turned out, already had a little gold mine in Baghlan province. His family had run a tiny artisanal operation there, even minting some coins, for years. He had won the legal rights to it in formal bidding in 2008. To develop it, he needed technical advice, equipment, and capital.

Naderi was an Ismaili, a member of a Shiite sect. That was a good thing in Hannam’s eyes. Progressive in their views toward women and education, Ismailis are renowned businessmen. The Ismailis’ religious leader, the Aga Khan, presides over a vast charitable and business network that includes the Serena Hotel chain. The sect has a long-standing relationship with the British, dating back to the 1840s, when Ismailis provided British armies in Afghanistan with cavalry and intelligence.

Naderi’s father was the religious leader of all the Ismailis in Afghanistan. The family has several mansions and a palace in their home village, Kayan, which has athletic facilities and a train, and once had a zoo. Naderi’s brother Jafar had been a militia commander during the last days of Soviet occupation, with a 12,000-member private army. A documentary film titled The Warlord of Kayan had shown Jafar fishing with a grenade, riding his motorcycle, and blasting AC/DC. During the Taliban era, the Naderis had fled for their lives, and Osama bin Laden briefly occupied their palace in Kayan.

Sadat Naderi, not surprisingly, was happy to contemplate an investment of working capital raised by J.P. Morgan and backed up by the Pentagon. “The sooner we stand on our own feet, the better it is for us Afghans,” Naderi says. “You cannot be a beggar nation forever.”

“Don’t fall behind.”

Naderi’s gold mine, in Baghlan province, is only 50 miles from Kabul as the crow flies. During winter months it might as well be on the moon. To get there by road you must traverse the dangerous Salang Pass, which cuts through the towering Hindu Kush range. In 2010, in the same month that the J.P. Morgan team first arrived in Afghanistan, 180 travelers were killed on the pass in an avalanche.

I had my own taste of winter travel over the 11,000-foot-high pass when I set out with a convoy led by Richard Williams, the mining company’s CEO. Garrulous, self-deprecating, and brimming with insights about the Muslim world, Williams could be mistaken for an Oxford don. But he remains the hard-charging individual depicted in Mark Urban’s book Task Force Black, which describes Williams’ exploits in Iraq as the leader of an SAS team charged with capturing and killing Hussein loyalists and al Qaeda members. “Richard is a buccaneer, a pirate,” Urban quoted one of Williams’ former associates as saying. “He goes for the opportunities and adrenalin every time.”

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Herding and farming are the main economic activities in Qara Zaghan.

It was snowing when we left Kabul early one morning, and by the time we reached the start of the climb, the weather had turned so nasty that police had halted traffic up the road. Nonetheless, our party of VIPs received permission to proceed with a police escort.

Williams and his group were in armored, four-wheel-drive vehicles. There was no room in the caravan for me, a translator, and a photographer, so we hired a driver and a Toyota Corolla. The front-wheel-drive car was soon laboring in the heavy snow. Our chains kept slipping off the tires. The radiator overheated, belching coolant into the snow. When it became apparent that we might not keep up, Williams’ group put a policeman in our car, and then proceeded on ahead without us. Visibility was terrible; the only way our driver could navigate was to crane his neck out a side window. After we passed the summit, the driver lost control of the car, which skidded and spun 180 degrees into a snowbank. Hands trembling, I lit my first cigarette in decades, wheezing on the first puff.

The next day, after spending the night in a hut, we set off on the return trip to Kabul. I begged Williams and his group not to abandon us. But when one of our party was stricken by a stomach ailment and we pulled over to let him relieve himself, the convoy swept on without us. We spun out again, narrowly missing a head-on collision with a truck.

When we caught up with Williams’ convoy near Kabul, we were too furious to wave. “I thought the SAS motto was similar to that of the U.S. Army [Rangers]: ‘Leave no man behind,’ ” I complained to one of Hannam’s soldiers-turned-bankers afterward.

“Leave no man behind?” He laughed. “Where did you get that idea? It’s ‘Don’t fall behind.’ And ‘Don’t forget your Imodium!’ ”

A deal too important to die

Of all the obtacles that could have wrecked the mining project — the murderous roads, the Taliban, the corrupt government — the one that nearly killed it was the most predictable: the profit margin.

In late September, J.P. Morgan CEO Jamie Dimon, Brinkley, and Mining Minister Wahidullah Shahrani met at J.P. Morgan’s headquarters in Manhattan. Dimon pledged J.P. Morgan’s support. On the way down in the elevator, Dimon told Shahrani, “You’re in good hands with Ian. He’s eccentric, but he gets things done.”

But soon Brinkley’s team was wondering. On the day the deal signing was to take place, Hannam’s team stopped acting like former warriors and began behaving like, well, nervous investment bankers. Hannam, after talking about how rich he was going to make his clients, suddenly began to complain that there was no way to make a profit. The 26% royalty rate for the mine, his team claimed, was way too high. Mining Minister Shahrani was bewildered — the rate had been agreed upon years before, when the Naderi family had first bid for the mine. Nothing had changed.

Brinkley’s Pentagon team was deeply frustrated. They felt the bankers had pulled a fast one. Had Hannam’s group not done its homework? Or were they just being bankers, trying to squeeze more money out of the deal with some 11th-hour brinkmanship?

Brinkley lit into the J.P. Morgan group: “When are you going to get this done? You’ve told people you’re going to do it!” The bankers, in turn, felt they were being unfairly pressured by the government, which seemed desperate to get the deal done even if it was uneconomical.

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Villagers of Qara Zaghan have been digging for gold for decades.

Everyone recognized, though, that the deal was too important to die. Naderi and Hannam’s team worked out an arrangement with the Ministry of Mines in which the royalty would be deducted from the corporate tax, as it is in many other countries. Soon, helped by rising gold prices, the deal was back on track. J.P. Morgan says it is not charging its usual advisory fees. While Hannam has described his work on the mine as a charitable endeavor, he says he expects a big payoff down the road for clients who invest in it.

J.P. Morgan says it isn’t putting any of its own money into the project. Hannam secured $40 million from investors in the U.S., Asia, and Europe. They included Enso Capital founder Joshua Fink, son of BlackRock’s Larry Fink; British mining titan Peter Hambro; and Thai businessman Pairoj Piempongsant. Hannam created an investment vehicle, Central Asian Resources, to enter into a joint venture with Naderi’s new mining company, Afghan Gold. Sadat Naderi was made chairman of Afghan Gold, and Richard Williams CEO. Their goal is to pull 5.4 metric tons of gold from the mine during the first phase of operation. After that the plan is to go after five other gold sites, and then bid for the rights to other minerals, including copper and rare earths.

This past December, an ecstatic minister of mines announced the deal. Petraeus congratulated President Karzai on the news. “Wonderful,” Petraeus remembers Karzai saying.

“It’s big,” Petraeus told me of the gold mine deal. “It’s very big. I mean, everyone knows who J.P. Morgan is, and what that represents. That’s substantial. It gives real encouragement to our Afghan partners.”

A deceptive peace

After the ceremony to inaugurate the mine in Qara Zaghan, the barren valley rang with a merry hubbub. Hannam’s close friend, Murad Megalli, responsible for J.P. Morgan’s investment banking practice in Central Asia and the Middle East, made portraits of the villagers with a Leica film camera. The minister of mines was exultant. Naderi spoke optimistically of “partnership” with his new investors. Everything seemed to be going right.

Then it wasn’t. At a military base on our way back to Kabul, our BlackBerrys started buzzing with news of a Taliban attack in the capital. Militants had struck one of Naderi’s supermarkets, called Finest, with guns and a bomb, killing eight people. Naderi at first didn’t understand what I was saying when I told him the news of the attacks. “The Finest got hit,” I said. “Hit?” Naderi said. “Finest hit?” He turned ashen.

Megalli and Hannam sat on a bench trying to digest what had happened. Hannam was at first convinced the attack was linked to J.P. Morgan’s presence in the country. It wasn’t. (The Taliban later claimed they were trying to kill an American mercenary who they erroneously claimed was at the store.) Then, Hannam immediately put his banker hat back on. At least the deal was done, he said, and the money was in.

Megalli was struck by how fast things could spiral out of control. “The peace here is so deceptive,” Megalli said. “It is so fragile.”

A week later I returned to my Kabul hotel room to receive this e-mail from Hannam about his colleague and friend: “Murad died in plane in Kurdistan yesterday. Any good photos I can give family?”

Murad Megalli and Hannam had flown out of Afghanistan on a private plane, and then gone their separate ways. Megalli had taken the plane to Kurdistan. The plane crashed in a snowstorm, and Megalli and another J.P. Morgan banker were killed. Hannam was devastated. From the meeting with Brinkley at the Baghdad Hunting Club, Megalli had been a champion of the Afghan venture. He had believed mining could make a difference for the country. His death, and the attack on Naderi’s supermarket, were sobering reminders of the personal risks of frontier capitalism.

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Baghlan Province has gold but few roads and no rail service, making it a challenging place to do business.

Other storm clouds hover over the enterprise. Corruption allegations swirl around several key backers of the mining project in the Karzai government. Paul Brinkley’s Pentagon team, which energized the Afghan mining sector and also put hundreds of Afghans to work in manufacturing technology and agriculture, is being disbanded, a casualty of interagency warfare. In April, after the burning of a Koran in Gainesville, Fla., mobs rioted in Afghanistan. The UN compound in Mazar-i-Sharif – a city that is to play a key role in the shipment of gold from the Baghlan mine — was attacked, and 12 people were killed.

The spark that Brinkley and Hannam struck, however, continues to burn. Six major minerals sites are due to be auctioned by the Afghan government over the next year. SRK, a major mining-consulting firm, will advise the Afghan government. Bankers from Morgan Stanley (MS) and executives from Chevron (CVX) have been scouting Afghan natural-resource prospects.

And next January the bulldozers and crushing machines are set to start working in the remote valley where Hannam’s investors have staked their claim. It remains to be seen whether the J.P. Morgan adventure will leave any more indelible a mark on Afghanistan than did Capt. Drummond of the Bengal Light Cavalry 170 years ago. But at least someone will have begun releasing the wealth trapped in Afghanistan’s stones.

–Doris Burke and Ali Safi contributed to this article.

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