Clear and present danger

TIME, we are repeatedly being told, is running out. The latest White House mantra, faithfully echoed from No.10 Downing Street, is that action against Iraq is “a matter of weeks, not months”. There has been no satisfactory explanation for why that should be so. Why can the arms inspections not be an open-ended process?

After all, what are the chances that Iraq would try to develop a nuclear weapon or attempt to share with terrorists any chemical or biological weapons it may possess while United Nations inspectors are busy at work? Zilch, by any reasonable reckoning.

Why, then, shouldn’t the inspections be allowed to continue, if necessary, indefinitely? If any “weapons of mass destruction” are found, they can be destroyed. If not, then the outcome ought to involve lifting the sanctions that are believed to be directly responsible for the loss of at least one million Iraqi lives.

But let’s not forget that the United States reluctantly backed the inspections process not because it desperately desired peace, but in order to find a more widely acceptable excuse for war.

Let us suppose the Iraqis were to fulfil US Secretary of State Colin Powell’s wish by loading any stocks of anthrax, VX or whatever they may have concealed on to a truck, and then “drive them up and park them in front of [the inspectors’ headquarters]”. Would we then be told: “Baghdad has done what was demanded of it. All its stocks of WMDs are now accounted for and will be neutralized under UN supervision. The UN will now be requested to lift sanctions, and the US military forces in the Gulf have been ordered to start returning home”?

Fat chance. It is far more likely the American response would be along the lines of: “We told you so! There’s bound to be a lot more where that came from, and some of it may already have ended up in Al Qaeda’s hands. The inspections are over. The first wave of missile attacks will commence tomorrow. God bless America.”

Is there any other conceivable no-war scenario? Well, there have been hints that Saddam Hussein and his clique may be offered immunity from prosecution were they to voluntarily go into exile.

On the face of it, that does not seem to be such a bad option. Saddam has never offered the people of Iraq good governance. They have consistently been tyrannized and subjected to mass slaughter, either by Saddam’s forces or as a consequence of Baghdad’s actions. No one with even an iota of common sense could argue that Iraqis deserve the Takriti regime, or that most of them would not be thrilled to see the back of Saddam Hussein.

But, apart from the fact that Saddam has thus far been disinclined to take the bait, there are several other points to ponder. In the improbable event of such an exit strategy being agreed upon, chances are that the US would continue to insist on its favoured “weeks, not months” time frame. What would be the consequences of the power vacuum that would inevitably follow the “regime disappearance”? Who would step into the breach?

Conveniently, Uncle Sam is waiting at the gates. It would insist on taking over from Uncle Saddam. But there is no guarantee that a US military occupation would avert a civil war. American troops — and bombers — could be engaged for a long time in “mopping-up operations” against “pockets of resistance”. A puppet regime in Baghdad would indefinitely be reliant on US forces for its survival, and it would almost certainly cede control of Iraq’s oilfields to the American corporations that are reported to have held discussions about concessions with Vice-President Dick Cheney.

Not only could such a state of affairs get very messy indeed, but one must also consider the principles at stake. What sort of precedent would be set by the Iraqi government’s abdication at gunpoint? The US would feel empowered to replace at its whim virtually any regime anywhere in the world with certified puppets. Who would be next? North Korea? Iran? Zimbabwe? Venezuela? Pakistan? And, just for old times’ sake, Cuba and Vietnam?

Granted, Saddam and his henchmen are a particularly nasty lot. Equally, many other regimes across the world, including some of Uncle Sam’s best friends, could be accused of doing a disservice to the people they misgovern. But external threats and use of force are invariably indefensible as a means of dislodging them. To cite but one example, the overthrow of the petroleum industry alumni with few qualms about violating human rights who are so keen to dip their hands once more in Iraqi blood, who currently hold sway in Washington, is best left to the American people; if it cannot be achieved electorally (remember what happened in Florida in November 2000?), they may be compelled to consider other means.

All the same, the exile option does offer Saddam Hussein an opportunity to panic the American oil men. Let’s suppose he were to suggest: “Okay, I’ll go, provided the UN is prepared to guarantee that it, and not the US, will set up an interim administration with the aim of holding elections within a year or so; that any peacekeeping force deployed in Iraq will be Arab-led; and that profits from the sale of Iraqi oil will be used exclusively to rebuild the country’s infrastructure and its economy.”

If he is unlikely to make such a reasonable offer, it is even unlikelier that the US would accept it. The stock response would be an uptight “We refuse to negotiate with dictators” or some such gem, followed rapidly by an invasion lest other members of the UN Security Council be tempted by the alternative scenario.

Current efforts by the Anglo-American axis are directed towards wringing a second resolution out of the Security Council in order to create the impression of an international imprimatur for the coming aggression. In ganging up with seven other right-wing European leaders to offer obsequious endorsement for US war plans, Tony Blair was endeavouring to serve the same purpose. As Nelson Mandela aptly put it last week, Blair is in effect “no longer prime minister of Britain” but “the foreign minister of the United States”.

Although resolution 1441 did not authorize the use of force, the US has always made it clear that it did not feel obliged to exercise restraint on that basis. Of late, a “material breach” of Iraqi obligations has been claimed more or less every day by US officials. Hans Blix’s presentation last week was, predictably, pounced upon as evidence, to the extent that the chief UN inspector subsequently found it necessary to question self-serving distortions of his report by the US. Meanwhile, IAEA chief Mohammed El Baradei’s plea for more time fell on deaf ears.

Blix will return to Baghdad during the coming weekend, and will be back at the Security Council for a follow-up report on February 14. Today General Powell will be fronting up before the Council with a show-and-tell performance aimed at substantiating tenuous claims of links between Baghdad and Al Qaeda. A second resolution will be moved only if Blair and George W. Bush are convinced that France will not use its veto. Jacques Chirac has thus far appeared resolute, but may well be swayed. Russia and China will, at best, abstain.

The Council’s non-permanent members may not be convinced of the case for a war but, with the possible exception of Germany and Syria, they are likely to be brought into line through a mixture of bribery and intimidation. Pakistan, for example, would anyhow have been disinclined to attract the wrath of Washington, but the question simply does not arise in the wake of analysts suggesting, with a degree of historical plausibility, that Islamabad would be a likelier source than Baghdad of WMDs for would-be fundamentalist warriors.

The drive for a second resolution as well as the fact that hostilities have not already been declared can be attributed primarily to the millions of people all across the world, not least in Europe and the US, who have been trampling the streets in support of peace. This remarkable phenomenon is worthy of closer scrutiny, and we may turn to it next week, ahead of the mass mobilizations planned for the following weekend. For the time being it is enough to applaud the growing realization in the West that Bush — who, in Mandela’s words, “has no foresight and cannot think properly” — poses an incomparably greater threat to world peace than the Iraqi dictator.

Unable to argue that the blood of innocent Iraqis is a price worth paying for access to oil reserves and to keep Israel happy, British and US officials speak only in terms of “disarming” Saddam. Cowardice prevents them from admitting that they simply do not care about the enormous loss of life and mass suffering that war will entail.

Bush’s State of the Union address last week had the unmistakable aura of an orchestrated Nuremberg rally circa 1936. The appeasers in the present context are not the champions of peace but those baying for war. Blair may fancy himself as a latter-day Winston Churchill, but he is more in the Benito Mussolini mould. Jacques Chirac is no Marshal Petain, but only if he can avoid the collaborationist temptation will the UN emerge from this month’s ordeal with some of its dignity intact.

E-mail: mahirali@journalist.com

America’s power game

POWER and arrogance characterize US diplomacy. “We will not shrink from war if that is the only way to rid Iraq of its weapons of mass destruction”, said Colin Powell at Davos, adding, “mechanisms are in place. It would be very difficult, it would take a miracle to find a dialogue and a peaceful solution out of the crisis.” Powell went on to declare that the US was ready to attack Iraq alone if allies peeled away.

“Multilateralism cannot become an excuse for inaction”, said the US secretary of state. The message is loud and clear. If necessary, America may act unilaterally to disarm Iraq. Washington had once given a nod of approval to President Saddam Hussein to attack Iran. Years later, an emboldened Saddam unsuccessfully tried to absorb Kuwait. The Desert Storm put that wrong right.

The UN imposed sanctions on Iraq and these are still operative. Overtime Washington became weary and decided to discard Saddam as it had previously abandoned its former allies - President Diem of South Vietnam, Shah of Iran and President Ziaul Haq of Pakistan, to name just a few. President Bush uses strong language against President Saddam Hussein and wants to remove him from power.

The US alleges that Iraq has clandestinely stockpiled weapons of mass destruction. Its faithful ally, Great Britain, joins in this chorus. The UN inspectors searched all places of their choice in Iraq for two months but failed to find any evidence to substantiate allegations. The chief UN weapons inspector, Mr Hans Blix, and the director-general of the International Atomic Energy Agency, Mr. Mohamed ElBaradei request for more time from the Security Council to enable them to complete their task. Commenting on their report the White House warns that Baghdad is “running out of time.”

The US ambassador to the United Nations maintains that the report does not “give us any hope that Iraq will disarm” voluntarily. Secretary Powell’s Davos speech and the US reaction to the UN inspectors’ report put the UN on the spot — act as demanded by Washington or you will be bypassed. This puts the world body on trial. Coming days and weeks will tell if it acts independently or succumbs to US pressure.

Media reports disclose that during the years 1998-2001 some sensitive nuclear-related materials and parts were received by Iraq from India through EIS Company. Some engineers of this company also worked at a plant in Iraq but this work was later abandoned. This case is currently under investigation.

An armada of the US and British forces in the Gulf awaits orders to go into action. The US has made elaborate plans to administer Iraq after it has been ‘liberated’ from President Saddam Hussein. The game of power and oil is being played out on the chessboard of Iraq on the pretext of uncorroborated allegations.

A vast majority of countries oppose an attack on Iraq because the UN inspectors have not detected any weapons of mass destruction and have requested for more time to complete their work. The North Atlantic Treaty Organization is under US pressure to pledge military assistance to Washington in case of war. France and Germany are against war and their heads of state maintain that it is wrong to believe that war is unavoidable. The US Defence Secretary Donald Rumsfeld makes a loaded comment that France and Germany represent an ‘old Europe’. This remark angers European leaders. Russia and China oppose a military offensive. Most countries are of the opinion that Iraq should fully adhere to the UN Security Council mandate, and that only the UN Security Council should finally decide any action against it, if necessary.

As war clouds hang over the Gulf region and media trial of Iraq continues, the Islamic countries are in disarray. The Arab League is mum. So is the Organization of Islamic Conference. The public reaction in these states is muted. The West is critical of Saddam’s harsh rule and ruthless policies. The Bush administration has links with Iraqi opposition and encourages it to rise in revolt. Such interference in the internal affairs of another country is unjustified and is violative of the UN Charter and international law. It is the right of the people of Iraq to make their policies and change their rulers if they so desire. Others cannot arrogate this right.

War in Iraq will disturb regional peace and create multi-faceted problems for the Gulf states and beyond. It will also have serious political and economic implications for Pakistan. Islamabad’s principled voice of reason demanding only UN-mandated action in Iraq may be too weak to be heard in the din and noise that prevails in the countries that call the shots, but it should continue to be raised at all levels. War will emotionally disturb a section of the Pakistani population, particularly the rightist groups. It will be so notwithstanding the fact that Pakistan-Iraq relations have had a chequered history in the past and Pakistan has some unpleasant memories. Emotions apart, human lives should be preserved not destroyed.

The people of Pakistan are against war. They advocate settlement of all disputes — global, regional and bilateral — peacefully and on a fair and equitable basis. Contentious issues should always be settled through negotiations and dialogue — be they in Iraq, Palestine, Kashmir or elsewhere. Removal of the underlying causes of conflicts is a wise approach to promote peace and security.

Regretfully, the commitments made by President Clinton (Kargil crisis) and President Bush that steps will be initiated for the settlement of Kashmir dispute remain unfulfilled. On the contrary, US policies now heavily tilt towards India. Of course, the US has the right to develop good relations with both India and Pakistan and these can be helpful in promoting regional peace. Recent history is one such example when India and Pakistan came dangerously close to an open conflict. However, Washington’s warm ties with India will hurt Pakistan if these are developed at the cost of Islamabad or to its disadvantage.

A recent development is a case in point. US Ambassador Nancy Powell urged Pakistan to comply with its pledges to prevent ‘infiltration’ into Indian-held Kashmir and not allow the use of its territory as a platform for terrorism. The ambassador’s statement raised a storm of protests in the national media and in political circles. The additional foreign secretary received the ambassador at the Foreign Office and informed her that no infiltration had taken place and that her remarks were inappropriate. An official of the State Department said in Washington that the ambassador was ‘misquoted’ in the media. However, he generally upheld what Ambassador Powell had said. The US ambassador to India, Mr Blackwill, had also earlier talked of ‘continuing cross-border terrorism.’

Significantly, Ambassador Powell’s written statement read out from a public platform did not include the denials issued by Pakistan. Nor did she refer to, or condemn, the massive acts of state-sponsored terrorism in Indian-held Kashmir. Her statement was considered biased and its timings noteworthy. It was meant to please India, to put pressure on Pakistan, to downplay Kashmiri freedom struggle and to divert attention from the INS registration issue raised by Pakistan’s foreign minister in the US. It provided fuel to the opposition to criticize Prime Minister Jamali for his government’s foreign policy.

Blackwill’s statement is a part of coercive diplomacy. Perhaps Washington has started seeing developments in Pakistan through the prisms of India. This aspect needs to be critically examined by the Foreign Office.

UN Secretary-General Kofi Annan shares the request of the UN weapons inspectors for more time. This reasonable demand reflects logic and justice. America is in a unique position to influence the global power scene from a moral high ground. A unanimous decision by the UN Security Council for granting more time will strengthen the world body and enhance Washington’s image. It will be a victory for peace and defeat for none. Events have presented President Bush a unique opportunity. He has the choice of being remembered in history as a visionary leader acting with circumspection or an ordinary mortal placing his ego before global public opinion.

Power and responsibility go together. The US undoubtedly has the power to crush Iraq, a weak country with insignificant power potential. This will not make Mr Bush great. His decision to save the lives of Americans, Iraqis and others will project him as a person of peace. His choice should be similar in Palestine and in Kashmir — find peaceful solutions to these conflicts.

The writer is a retired general of the Pakistan Army.

Babar and the elephants

PEOPLE who roam the corridors of power are always on the look-out for official appointments and concessions and contracts — anything to make money the easy way — for no one ever died of hard work in government service.

Even the Council of Islamic Ideology is not left alone. Somebody was telling me the other day that the four vacant posts of members are also considered an attraction although they are meant to be filled up by Islamic scholars. So far as I know, the Council (or the CCI) has been in existence for something like forty years and has the last word on disputed matters. And whereas it has declared hundreds of laws, rules and practices as being contrary to the Quran and the Sunnah, none of its recommendations seems to have been accepted either by successive governments or the people.

But it certainly was a painful reality for the late Maulana Kausar Niazi when he was made chairman of the CCI by the then prime minister, Ms Benazir Bhutto, in 1993, and must also have been for his successor, the late Iqbal Ahmed Khan (of the Muslim League), who must have pulled his hair at the style of scholarship displayed by past members. Before I give you some examples, let me digress a little on the methodology of debating.

A clever debater always tries to demolish his opponent’s case by using the latter’s own arguments against him. Something like what Babar did in the First Battle of Panipat. He scared the elephants of Sultan Ibrahim Lodhi with the sound of his cannon, and the massive beasts ran back trampling their own forces in the process.

At one time in pre-partition India our ulema were very fond of conducting public debates with Christian and Hindu priests. These “manazaras” used to be great events, and thousands of adherents from both sides would listen to their respective wranglers and applaud their biting criticism of the other faith and its leaders. Apparently neither side was able to convince the other of its flawed perceptions.

Otherwise the whole of Hindustan would have been converted to Islam, or we, the Muslims would have adopted either Christianity or Hinduism (or even Sikhism) as our new faith. In these debates too the favourite ploy of the speakers was to beat the opponent with his own logic.

The Islamic Ideology Council’s stand against family planning stems from its refusal to submit itself to ijtehaad, or revised thinking in changed circumstances. Apparently they were unmoved by Iqbal’s call for ijtehaad in his famous lectures and their admiration of him was confined to his popular poetry. For instance, whereas Al-Azhar has revolutionised public opinion among the Muslims of the Arab world on the subject, and the ulema of Indonesia and Malaysia have decided to forge ahead, these gentlemen have refused to budge.

This reminds me of how, in the past, the CCI, while rejecting birth control as un-Islamic, relied on the reasons that Lord Bertrand Russel put forward to oppose the practice. It is common knowledge that Russel had rejected the faith of his parents. Instead of looking to Christian religious leaders for support against family planning (like the manazira maulvis relying on opponents arguments to support their own theses) the CCI quoted the opinion of a non-believing philosopher. Would it have liked us Muslims to follow Russel’s other precepts too, like atheism?

An outstanding characteristic of the CCI has been that, closing its mind to ijtehaad (as stated above) it used to operate as if its members were living in the Middle Ages. Apparently its members led their own lives in harmony with modern-day needs and modern education, but wanted us to go back in history. Then, venturing into the field of military preparedness, the council had said that if the obnoxious practice of restricting births was adopted on a wide scale, the country would be deprived of the necessary manpower for its armed forces.

This was such a revolutionary concept that I’m surprised the West didn’t catch on to it. If properly publicised it must leave thinkers and sages in the US, Europe, Japan, etc. (and especially China) far, far behind since they thoughtlessly promote birth control on a national scale, ignoring their countries’ defence needs. Maybe they would like to engage the former CCI members as military advisers.

Although not pertinent to the topic, I am reminded of what an old man once said to President Ayub when the latter was explaining the advantages of family planning to a group of maulvis of Hazara, his homeland. Said the old man, “Huzoor, janaab, we have to say only this much that had your worthy parents opted for birth control the country would have been deprived of the greatest leader in its history.” Why wasn’t this wise old man taken on the Council of Islamic Ideology? As an example of home-grown rural wisdom the remark was a minor masterpiece, but that’s about all there was to it.

Here’s another argument from the old CCI against birth control as quoted by an Urdu columnist. It was stated “on authority” that by practising birth control women are apt to lose their hair. Maybe I haven’t looked carefully, but, by this account, European women shown on foreign TV should all be bald. Perhaps they are wearing wigs!

I must obtain the complete version of the CCI’s verdict on family planning from its present chairman, Dr S.M. Zaman, who is said to be an enlightened scholar. Besides, Dr Zaman must put his foot down, even if he does not have the authority, and insist that the four vacancies in the Council are filled up by genuine scholars of Islam, otherwise one can assume that the government is out to belittle the image of Islam in the eyes of the world by nominating half-baked experts for such an important assignment.

Joining hands across borders

TODAY as the world stands poised on the edge of war, a paradoxical phenomenon is emerging on the international scene. This is the worldwide peace movement which has been spawned by the growing thrust towards war. The massive turn-out at the rallies in Washington, London and other European capitals against an American attack on Iraq should leave no one in doubt about the strong pacifist sentiments the world over.

Its significant feature is that it transcends international boundaries. For the first time in contemporary history, people struggling for a common cause are joining hands transnationally to demonstrate their commitment to peace.

The threat of war has galvanized the peace activists into action. Earlier, the risk of impoverishment and deprivation which looms large on the horizon — and has already begun to impact on people’s lives in Third World countries — had roused the conscience of thousands who came together in the anti-globalization protests in Seattle and other cities where the World Trade Organization meetings were being held in the last few years since the WTO was founded in 1995. They have now joined hands under the banner of the World Social Forum to resist the growing avarice and the monopolistic tendencies of the corporate sector.

The peace movement is following a similar pattern, though it reflects a greater sense of urgency, given the imminence of war against Iraq and its terrifying consequences. What is significant about this protest is that it has brought together on the same platform like-minded people from different countries. The extensive reach of the protests has given them strength and visibility which have created a deep impact.

This is the other side of the globalization process unintended by its protagonists. It has facilitated the movement of capital, and, to some extent, people too, and has lowered state barriers. This has allowed the people of different states to interact with one another and rally round common causes which affect them all. Communication technology has helped in this process by facilitating the exchange of information, and the trans-border education and mobilization of people.

This may not exactly be the withering away of the state as visualized by Karl Marx. But it certainly means some dilution of the concept of national sovereignty as envisaged as a feature of the modern state which had emerged in Europe — followed by the rest of the world — after the Treaty of Westphalia in 1648. The present process is not a redrawing of the political/geographical map of the world. It is a new political trend which is now gathering force and momentum in step with the globalization process itself.

As a result of this trend, the affinity of the social classes now runs across international boundaries. For instance, the workers, be they in Pakistan, America or Europe, have many common interests uniting them in their equations with the capitalists and they can relate to each other quite naturally. When the workers in one country feel threatened by an event in one country, their colleagues in other parts of the world also feel concerned. Thus the globalization process which is undermining Third World economies has been challenged in the West as well. The protesters in the industrialized countries also have a cause to worry. They fear the loss of jobs if their companies move to the Third World to set up their factories in regions where labour is cheaper and plentiful.

The universalization of the English language and the spread of intellectual ideas — the Internet has played a phenomenal role in this — has also led to the jelling of like-minded people into cohesive intellectual groups, international boundaries notwithstanding.

This emerging phenomenon has significant implications for world politics and international relations, as well as for the domestic politics of different countries. It has made it possible for the people from the so-called “enemy countries” to join hands to form pressure groups for peace. One just has to look around to see how people who at one time would have been on different sides of a political divide now find themselves drawn together sailing in the same boat.

Numerous friendship groups have sprung up in India and Pakistan, the West Bank and Israel, and other places where the people on the opposite sides of the borders have united on a common platform of shared views and aspirations irrespective of their governments’ official stance. Their aim is to find the middle ground.

Such moves have the potential of generating pressure in favour of peace and conciliation and against a policy disposition to hostility and belligerence. Although so far this has not created the required impact on the official policies of different governments, one hopes that it will serve as a restraining force. Thus the governments of India, Pakistan and Israel continue to adhere to their policies in spite of what the peace activists have to say. In the United States, one cannot be certain that the massive rallies against a war on Iraq will actually deter President George W. Bush from attacking that country. The second significant implication of this trend is that the polarization which takes place is not between different states/governments; it is between different classes spread across the national boundaries of sovereign states. This could have profound implications for the domestic politics of states while also affecting international relations.

The failure so far of the peace movements to palpably influence their governments is a paradox in a world which sets great store by democratic norms and participatory governance. There are three instances which stand out conspicuously. In India, the numerous voices of sanity and moderation which have been raised and the strong protests by secular forces against communal killings in Gujarat failed to swing the vote against the BJP and its leaders such as Narendra Modi in the state elections in December. However, the series of state elections due in India later this year would be the true test of the influence of the peace activists on the voting trend in the country.

In the United States, opinion polls have registered a slide in George Bush’s popularity from 80 per cent or so in early 2002 to 52 per cent a few weeks ago. And yet in the mid-term elections in November the Republicans won a landslide victory. This is a phenomenon which peace activists should study to determine the factors which prevent the peace mood from translating into votes in the electoral process.

Likewise, in Israel, where the fledgling peace movement PEACE NOW has struggled against the injustices of the occupation, Ariel Sharon’s hawkish Likud party was swept back into office in the general elections in January.

There is a horizontal polarization which appears to be taking place. The scenario that is emerging could be a destabilizing one because we could see states pitted against each other internationally while fissures within them could lead to civil strife. All this points to the urgent need to speed up the pace of efforts towards creating a peace culture and a climate of tolerance and coexistence.

The scope for doing this is quite considerable. Globalization has been accompanied with high technology communications, such as satellite and cable television and the Internet, and this has facilitated greater interaction between the institutions of the states and their people. This interaction is taking place even between citizens of supposedly ‘enemy’ countries.

In these conditions, the theory of balance of power as it developed in the post-Congress of Vienna European system now appears to be quite obsolete. The only option for statesmen is to devise a new international system untied to the myth of state sovereignty in the traditional, puritanical sense and seeks to create an equitable equation among states based on tolerance and coexistence. The protagonists of peace are potentially stronger than their opponents. While those in the peace movement can unite on a minimalist agenda of non-violence, secularism, social justice and humanitarian values from all over the world, the radicals outside the peace movement stand divided and at loggerheads with one another.

The need of the hour is for the supporters of the peace movement to prevail over the governments with militant and hardline policies. At present they are simply catching the media’s attention. This is not enough. It is equally important to persuade those in office to change their course.

Soft on the auditors

YOU might have thought, after the damaging accounting scandals of last year, that America’s chief regulators would insulate themselves a bit more from the lobbying of the accounting industry. But last week, as the Securities and Exchange Commission scrambled to write new rules implementing the law passed by Congress last year to crack down on corporate accounting scandals, industry fingerprints were once again evident.

It’s true that the commission took some positive steps to regulate auditors who are supposed to assure investors that corporate books aren’t cooked. But the SEC, facing intense opposition from the powerful and vociferous accounting industry — and with the discredited and supposedly departed Harvey Pitt still in charge — also backed away from several measures that would have done more to break the insidious relationship between auditors and the companies that pay them. It appears the lessons of Enron haven’t sunk in everywhere.

One such lesson was that auditors, who are meant to be independent of the companies they audit, shouldn’t also be harvesting fat consultant contracts from those firms. But the SEC last week decided that accounting firms can provide both auditing services and extensive tax advice, a lucrative growth industry. This puts accounting firms in the conflicted position of first recommending tax shelters to their clients and then having their own auditors review the permissibility of such schemes.

The SEC has punted this question to the audit committees of corporate boards of directors — many of which have not distinguished themselves with their aggressive oversight.

The rules also will allow accounting firms to blur the amount of money they earn from services other than audits, allowing such fees to be lumped in with accounting services. That will mean that shareholders and others will find it more difficult to know how much accountants are being paid for their pure auditing work compared with the amount they are earning from consulting services. This again goes to the heart of the conflicts that auditors face in not wanting to offend the corporate hand that feeds them other business.

The rules head in the right direction by prohibiting auditors from receiving bonuses for bringing in non-audit work.

—The Washington Post