www.timesdaily.com By ANDREW SELSKY Associated Press Writer January 27. 2003 6:07PM

A Colombian police officer stands guard over a bridge on the Arauca River that leads from Colombia to Venezuela, Saturday, Jan. 18, 2003. President Alvaro Uribe has made Arauca state a priority, but months into his crackdown, it remains a lawless frontier. The governor, a retired army colonel, recently resigned because of death threats. And while government forces are concentrated in the towns and U.S. special forces have arrived to train Colombian troops, rebels and paramilitaries still carry out attacks in the grassy savannas at will. (AP Photo/Zoe Selsky)

Colombia's interior minister insisted Monday that the government was still in control of Arauca state, a region where one rebel group killed six soldiers and a civilian with a car bomb over the weekend and another kidnapped two foreign journalists.

Colombian Defense Minister Martha Lucia Ramirez and the commander of the armed forces, Gen. Jorge Enrique Mora, visited Arauca on Monday to investigate the volatile situation.

The car bomb, which exploded near a military patrol in the village of Pueblo Nuevo on Sunday, was believed set off by the rebel Revolutionary Armed Forces of Colombia, or FARC, the army said.

The civilian who died was the driver, the army said. The blast, about 200 miles northeast of the capital, also wounded eight soldiers and another civilian, the army said.

Authorities have accused rebels of twice using hostages as unwitting suicide bombers, luring them into cars without telling them the vehicles were packed with explosives, and then detonating the bombs by remote control when the car neared a military target.

Arauca - a state about twice the size of New Jersey in northeastern Colombia, along the Venezuelan border - is rich in oil resources, and FARC and other rebel groups have repeatedly attacked a pipeline running through the state. An illegal right-wing militia is battling the rebels for control of the oil plains in the state, which has about 350,000 residents.

Some 70 U.S. Army special forces trainers are to begin training a Colombian army brigade in counterinsurgency tactics in Arauca this week so they can protect the oil pipeline, owned jointly by Los Angeles-based Occidental Petroleum and the Colombian oil monopoly Ecopetrol.

Interior Minister Fernando Londono said Monday the government was still in control of Arauca, despite the violence.

"This doesn't mean that the government, the armed forces and the police have lost control of Arauca, which is a very difficult zone to manage," Londono told RCN radio Monday.

The army announced it killed three rebels Sunday near the Arauca town of Saravena. No further details were immediately available. There was also no word on the fate of kidnapped American photographer Scott Dalton, 34, and British reporter Ruth Morris, 35.

Their rebel captors - the National Liberation Army - have said nothing about the freelance journalists since announcing Thursday over a clandestine rebel radio station that they had "detained" the two, who were on assignment for the Los Angeles Times, on Jan. 21.

There was concern the recent bombings and clashes between government security forces and rebels put the hostages' lives at risk, but there have been no calls for the army to mount a rescue attempt.

Arauca's oil pipeline resumed pumping Sunday night after being shut down for four days due to a rebel bombing, an Ecopetrol spokesman told Dow Jones Newswires on Monday.

The dynamite attack last Wednesday was the first of the year on the pipeline, which was bombed 40 times in 2002 and 170 times in 2001.

Some 3,500 people die each year across Colombia in the decades-long war. The army announced Monday that rebels had killed eight people over the weekend in various parts of the country, including two who had been kidnapped.

www.quicken.com

Monday, January 27, 2003 04:37 PM ET  Printer-friendly version   NEW YORK (Dow Jones)--The national average retail price of regular gasoline rose by 1.4 cents a gallon to $1.473 in the latest week, the Energy Information Administration said Monday.

The price is up for the seventh straight week and at the highest level since last Sept. 24. Retail gasoline has gained 8.3%, or 11.3 cents, over the past seven weeks amid worries over an impending war with Iraq and the continuing strike disrupting Venezuela's oil exports.

Prices are 37.2 cents above a year earlier.

Prices are based on a survey of 900 retail outlets.

Prices gained in all regions.

On the East Coast, prices were up 0.4 cents at $1.466 and were 37.6 cents above a year earlier.

Midwest prices were 2.1 cents higher at $1.459 and were 38.3 cents above a year earlier.

Gulf Coast prices were 0.7 cent higher at $1.414 and were 36.8 cents above a year earlier.

Rocky Mountains prices were 2.4 cents higher at $1.438 and were 32.1 cents above a year earlier.

West Coast prices were up 2.1 cents at $1.569 and were 35.9 cents above a year earlier.

• By David Bird, Dow Jones Newswires; 1-201-938-4423; david.bird@dowjones.com

www.scoop.co.nz Tuesday, 28 January 2003, 10:03 am Press Release: Council on Hemispheric Affairs

Venezuela: Tainted Journalism or Paranoia? Memorandum to the Press 03.03 For Immediate Release Monday, January 27, 2003

Venezuela: Tainted Journalism or Paranoia on the Part of The Middle-class Opposition

Dear Colleague,

As part of the ongoing debate concerning the current political instability in Venezuela, we are reprinting an article, authored by Thor Halvorssen, published in the commentary section of the The Washington Times on Jan. 22, 2003, attacking the position of the Council on Hemispheric Affairs, and the response to it by COHA director, Larry Birns, which appeared in the Washington Times on Jan. 26, 2003.

Venezuela through a tilted lens? Washington Times, January 22, 2003 Thor Halvorssen

With every passing day, life for Venezuelans becomes more dangerous. Since his election four years ago, President Hugo Chavez has presided over the most dramatic decline in the nation's fortunes: Analysts predict that in the first quarter of 2003 the economy will contract by 40 percent; more than 1 million jobs have been lost; approximately 900,000 people have gone into voluntary exile (most of them middle-class professionals); unemployment is at a staggering 17 percent; Almost 70 percent of the country's industries have gone bankrupt; 70 percent of Venezuelans live in a state of poverty (up from 60 percent when Mr. Chavez began his rule); and the income of more than 15 percent of Venezuelans has dropped below the poverty line.

Mr. Chavez's policies have left the nation in shambles. Stratospheric levels of corruption, collectivist central planning, mismanagement, and incompetence during the greatest oil boom have squandered a historic opportunity to cultivate a stable middle class. But stability is hardly the goal of Lt. Col. Chavez, who uses the nation's wealth to fund and supply weapons to the FARC and ELN drug-trafficking guerrilla terrorists in Colombia and the ETA Basque terrorist organization in Spain.

Mr. Chavez has cozy relationships with the dictators of Cuba, Libya, Iran, and Iraq (Mr. Chavez praised Saddam Hussein as his "brother" and "partner"), and earlier this month Mr. Chavez was accused by his personal pilot of funneling $900,000 to Osama bin Laden. Mr. Chavez has publicly described the U.S. military response to bin Laden as "terrorism" claiming he saw no difference between the invasion of Afghanistan and the September 11 terrorist attacks on the U.S.

Readers of the New York Times, The Washington Post and of the Associated Press, and viewers of CNN, are fed a dramatically different story. There is an enormous divide between what the world is hearing about Venezuela and what is really happening there. Reporters have so controlled the flow of information and disfigured the truth that their coverage of Venezuela is a caricature of what conservative critics call the "liberal media bias." What we are seeing in media coverage of Venezuela is not liberal bias, but totalitarian bias.

A recent example is Christopher Toothaker of the Associated Press. Mr. Toothaker has spent considerable time in Venezuela, he speaks Spanish, and he has access to government and opposition sources. In a Jan. 4 report, he minimized the importance of the upcoming constitutional referendum, stating that the opposition presented "over 150,000 signatures" to election authorities calling for a vote on whether Mr. Chavez should resign. This is a dramatic and deliberate understatement. The Venezuelan Constitution, approved by Mr. Chavez himself, provides for a referendum if 10 percent of the electorate petitions in writing. The opposition presented 2,057,000 signatures - some 15 percent of the voting rolls - a startling error that any fact-checker should catch. The smaller figure appears in dozens of other Associated Press reports, CBS, CNN and even in a story bylined by Ginger Thompson of the New York Times that was carried in the South Florida Sun-Sentinel.

Miss Thompson is no fan of objectivity. On Jan. 3, the opposition organized a march to protest Chavez. Hundreds of thousands of nonviolent demonstrators carried flags, posters and signs calling for a peaceful resolution. The protesters were ambushed by members of Mr. Chavez's armed militia who dispersed the march with a hail of bullets and rocks. The Chavez police blithely watched the armed thugs shoot at the defenseless crowd. I was there. To our incredulity, the Chavez police then supplied the criminals with tear gas grenades. In her Times story, Miss Thompson characterized the violence as a "clash" and a "street fight" - moral equivalency at its worst. American readers would never know it was an ambush.

The sympathies of Miss Thompson's colleague, Juan Forero, are revealed by Larry Birns, director of the Council for Hemispheric Affairs. In late December, Mr. Birns, a refreshingly sincere D.C. activist who acts as a Chavez cheerleader and apologist, told a Venezuelan government official the names of the four reporters he believed were most amicable to the Chavez government. This Times scribe made the top of his list: "He is committed to the revolution," Mr. Birns said of Mr. Forero. Reuters and the Associated Press were also praised for their "strong support" of Mr. Chavez.

The Washington Post's reporting is just as cant-laden as the New York Times', and its editorial page is utterly one-sided. Last Sunday, Mark Weisbrot of the Center for Economic and Policy Research penned a column calling the Chavez government, responsible for dozens of political deaths, "one of the least repressive in Latin America." He should travel more.

Mr. Weisbrot states that "no one has been arrested for political activities." This is nonsense. Some of these arrests are so public Mr. Weisbrot cannot credibly claim ignorance. For example, Carlos Alfonso Martinez, an outspoken political opponent of Mr. Chavez and one of the most respected officers in the armed forces, was arbitrarily arrested on Dec. 30 by the secret police. The act caused public furor both because it was a further indication of government repression and also because Mr. Martinez was arrested without a warrant and remains under arrest even though a judge ordered his immediate release. How did this fact slip by the editors at The Post?

Mr. Weisbrot ends his column in The Post by saying that Chavez is Venezuela's best hope for democracy and social and economic "betterment." And yet Mr. Weisbrot does not support the referendum that would let the voters declare whether Mr. Chavez rules with the consent of the governed. Mr. Chavez told voters in a television broadcast: "Don't waste time. Not even if we suppose that they hold that referendum and get 90 percent of the votes, I will not leave. Forget it. I will not go."

Putting aside Mr. Chavez's track record on economics, does this really sound like the best hope for democracy?

Meanwhile, members of the U.S. government, business, and diplomatic communities make their decisions based on the "knowledge" they acquire from the media. Venezuelans are suffering unnecessarily because of the arrogance and favoritism of a handful of journalists. It is wicked. Yet what is worse is that, no matter what happens, the media will never be held accountable.

Thor Halvorssen is a human-rights activist who was a political adviser andconsultant in two Venezuelan presidential elections. He lives in Philadelphia.

Letter To The Editor, Washington Times, Published Sunday January 26, 2003

Tony Blankley Editorial Page Editor The Washington Times

January 26, 2003

To the Editor:

I admit I hadn't heard of your contributor, Thor Halvorssen ("Venezuela Through a Tilted Lens," 1/22/03), but I now know that he's a shameless inventor. Moreover, the Times may have been gulled by an author with a complex past, which can be checked on the internet. Also, why didn't he reveal that he wasn't just your average Philadelphian, as listed, but served as Venezuela's drug czar in the early 1990s, under one of the most corrupt governments in its history, when he was involved in questionable incidents of public interest?

Halvorssen savages your professional colleagues for their alleged bias reporting from Venezuela. Among these, were two highly respected New York Times reporters, Juan Forero and Ginger Thompson, to whom I have spoken by telephone. Halvorssen's mean-spirited attack and his patently off-the-wall conspiracy theories regarding their alleged favoritism towards leftist Venezuelan president, Hugo Chávez, are an extremist's fulminations against the international media. These, almost without exception, see today's uproar there not as a Castro complot, but due to misadventures on both sides.

Halvorssen's targets - the New York Times, the Washington Post, Reuters, and AP - are also vilified by the left for their anti-Chávez bias, using almost the same verbiage as his. The sin of these very solid professionals apparently is that they have tried to fairly treat an extremely involved story, thus inviting Halvorssen-like sclerotic attacks.

While I'm grateful for his characterizing me as "refreshingly sincere," I'm afraid I can't return the compliment, for I think he's up to knavery. He says that I told a Venezuelan government official that Timesman Forero was "committed to the revolution." Nonsense! I said no such thing. Last Christmas Eve, I received a phone call at my in-laws house in New Jersey, from a man who spoke rapid Spanish and poor English. Since I couldn't quite understand him, I soon turned the phone over to a Spanish-speaking relative.

This alleged high Chávez official frantically blurted out that an anti-Chávez coup was to occur on Dec. 29th, and that I must come down to Caracas immediately and bring four U.S. journalists of my choice with me as observers. I expressed skepticism whether this was possible, but at the very least I would need to consider it, and besides I felt that the New York Times, Reuters, AP, among others, were doing a first-class, balanced job, so why were more reporters required? I quickly sensed that the Caracas call might be a scam, particularly when the official didn't again call, as scheduled. Given his somewhat gamey biography, I now assume that Halvorssen was somehow involved in this script, or even made the call, because the only other conversant person would be the professed Chávez official, who presumably would not be the former's soulmate.

Rather than a Chávez "apologist," as Halvorssen claims, COHA has been a critic since 1998, when it attacked him for his too-close military ties. Since then it has found him "arrogant," "confrontational," "authoritarian," "acerbic," and "inflexible." As for both Halvorssen and the opposition, on the rare occasions when they tell the truth, they wail that the economy is dying and that the petroleum industry is heading for ruin, but fail to acknowledge their own direct complicity.

What is needed is moderation and concession. Venezuelans of Halvorssen's ilk must see that they constitute a disloyal opposition threatening the destruction of the political system through foul play, and not Athenian democrats. As for Chávez, he risks suffocating his revolution by holding it too tightly, as time runs out for him and also the opposition.

Larry Birns Director Council on Hemispheric Affairs Washington, D.C.

1730 M St. NW, Suite 1010 Washington, DC 20036 (202) 216-9261 coha@coha.org

www.examiner.com Date: 01/27/2003 BY CONN HALLINAN Special to The Examiner

    WHEN THE BUSH administration threatened North Korea with nuclear weapons last year, it did more than ignite the present standoff in North Asia. It opened the Pandora's Box of proliferation.

    The genesis of the present crisis goes back to the administration's 2001 nuclear policy review, which proposed using nuclear weapons against non-nuclear nations, including Libya, Syria and North Korea.

    While the North Koreans have caught flak for withdrawing from the Nuclear Non-Proliferation Agreement, it was, in fact, the U.S. that violated the treaty by making the threat in the first place.

    Under the 1968 agreement, nuclear powers agreed never to threaten non-nuclear nations with nuclear weapons unless those countries were in alliance with another nuclear power.

    In spite of the insular and rigid nature of the North Korean regime, it is George Bush, not Kim Jong Il, who has thumbed his nose at the international community. Washington, not Pyongyang, dismantled the Anti-Ballistic Missile Treaty, the Strategic Arms Limitation Agreements and is preparing to violate the Comprehensive Test Ban Treaty by testing its "bunker busting" nuke.

    How did this happen?

    It happened because the spineless Democrats remained silent and because the United Nations Security Council failed to challenge the nuclear policy review as a violation of the Non-Proliferation Treaty.

    Where will this lead? How about a nuclear arms race in Asia?

    North Korea is not the only proliferation problem on the Korean Peninsula. In March 1994, the head of the South Korean National Security Planning Agency revealed that former President Roh Tae Woo approved a covert nuclear weapons program.

    There are at least two other countries in Asia that can produce nuclear weapons if they choose -- Japan and Taiwan.

    According to the CIA, Taiwan, Israel and South Africa tested a nuclear weapon over the South Atlantic on Sept. 22, 1979, so we can assume the Taiwanese know how. And in May 2002, Japan's chief cabinet secretary, Yasuo Fukuda, said that Japan was considering abandoning its long-term opposition to nuclear weapons.

    How about nuclear weapons in South America?

    Early this month, Brazil Minister of Science Roberto Amaral said Brazil could not afford to renounce any scientific knowledge, "whether the genome, DNA or nuclear fission."

    The left-wing government of President Luiz Inacio Lula da Silva quickly distanced itself from Amaral's remark, but Brazilians are well aware of the unequal nature of the Non-Proliferation Treaty. In September da Silva said that, "If someone asks me to disarm and keep a slingshot while he comes at me with a cannon, what good does that do?"

    Brazil and Argentina have nuclear programs dating to the 1950s and, during the period of their respective military dictatorships, pursued nuclear weapons research. Both countries signed the Non-Proliferation Treaty, but Brazil has cause to be jumpy, given the Bush administration's attitude toward left-wing regimes in Latin America.

    Republican Rep. Henry Hyde, chairman of the House International Relations Committee, says Brazil, Venezuela and Cuba are a Latin "axis of evil" and that da Silva is a "pro-Castro radical."

    Talk like that ought to make everyone nervous these days, particularly with right-wing extremists such as John Bolton, Otto Reich and Elliot Abrams heading up the administration's Latin America policy.

    If Brazil decides to take this axis stuff seriously, it may indeed decide to go nuclear. If Brazil builds a bomb, so will Argentina.

    "Sow the wind, reap the storm" goes the old dictum. The Bush administration has been sowing nuclear threats since early last year, and we are reaping the results of that policy.

    Comment: letters@examiner.com

    Conn Hallinan is a provost at UC Santa Cruz.

money.cnn.com January 27, 2003: 3:30 PM EST

Fear of war with Iraq takes its toll on U.S. markets; blue chip average at its lowest in 3 months.

NEW YORK (CNN/Money) - Investors continued to pummel the stock market Monday afternoon after progress reports from U.N. weapons inspectors failed to quell fears about the likelihood of war with Iraq.

Shortly after 3:00 p.m. ET, the Dow Jones industrial average (down 109.77 to 8021.24, Charts) and the S&P 500 index (down 11.49 to 849.91, Charts) both lost just under 2 percent, while the Nasdaq composite (down 15.45 to 1326.69, Charts) lost more than 1.5 percent. The Dow's decline continued to outpace that of the other indexes, and the average briefly fell below 8,000 for the first time since October. Its losses Monday came on top of a 5-percent decline last week.

"The market has had war jitters and that, to a large extent, is responsible for a lot of the retreat over the last few weeks, but the decline comes with the backdrop of other things," said Michael Carty, principal at New Millennium Advisors. "You have worries about North Korea, Venezuela, the elections in Israel, you have companies saying that they won't provide guidance, like McDonald's and Coca-Cola. There are tremendous amounts of cash out there, but nobody wants to get in."

Chief U.N. weapons inspector Hans Blix delivered his team's 60-day progress report to the U.N. Security Council Monday morning. Blix said that although Iraq has cooperated with U.N. inspectors, it has failed to offer proof of its complete disarmament from weapons of mass destruction. The report by Blix and International Atomic Energy Agency director general Mohamed ElBaradei indicated that inspectors would need more time to complete their task in Iraq.

Uncertainty over whether inspectors will get an extension for their work has left investors skittish and has pressured U.S. stock markets and the dollar. Although several key members of the Security Council, including France and Germany, have said inspectors should be given more time, U.S. officials have stated that the country is prepared to go to war with Iraq alone.

"You had a terrible day Friday with the market pricing in the reality of these events and you have a continuation of that reaction now. There are no surprises. It's pretty much across-the-board negativity," said Douglas Altabef, managing director at Matrix Asset Advisors.

Following the morning's reports, Bush Administration officials said that Iraq was not in compliance and that the U.N. needed to reassess how it approaches the situation.

"The U.N. says go slow, the U.S. says the fact that Blix can't find anything is more of a comment on Blix than anything else," Matrix Asset Advisors' Altabef added. "The point is, Bush is not going to be deterred by these findings."

The Iraqi weather is also a factor in any military action, Altabef said, noting that if the Bush Admininstration is going to act, it will need to do so soon, because after April, extremely hot weather would impact military action.

The United States' position will become more clear Tuesday, when President George Bush is scheduled to deliver his annual State of the Union address, a portion of which is expected to be dedicated to the government's views on Iraq.

Another factor likely to impact the market in the coming days is the two-day meeting of the Federal Reserve's policy setting Federal Open Market Committee, set to begin Tuesday. Tech stocks lag, too

The day's corporate news was scattered and mostly bearish. Two of the technology sector's titans, Microsoft (MSFT: down $0.81 to $49.04, Research, Estimates) Chairman Bill Gates and Hewlett-Packard (HPQ: down $0.52 to $18.23, Research, Estimates) CEO Carly Fiorina, both said over the weekend at the World Economic Forum in Davos, Switzerland, that they don't see demand for new information technology picking up anytime soon.

Most major technology stocks, including Microsoft and Hewlett-Packard, declined. Microsoft, a member of the Dow industrials, was the Nasdaq's No. 1 most active issue.

Although the period of reporting fourth-quarter earnings is coming to a close, a few big names are still expected to report results this week. Dow component American Express (AXP: up $0.08 to $33.78, Research, Estimates) reported a profit of 52 cents per share, more than twice what it earned a year earlier and a penny better than what analysts were expecting. The company is the first of 11 Dow components due to report results this week. Its stock, which had been down all morning, rose modestly after the report.

Shares of Dow component Johnson & Johnson (JNJ: down $1.31 to $52.30, Research, Estimates) fell after the consumer products company said late Friday that it will take a charge in the fourth quarter after a court ordered it to reimburse Amgen (AMGN: down $1.46 to $50.78, Research, Estimates) for attorneys' fees and other costs associated with a licensing dispute.

On the Nasdaq, shares of i2 Technologies (ITWO: down $0.32 to $0.94, Research, Estimates) lost 25 percent in active trade after the business software maker said it would need to reaudit 2001 and 2002 results after the Securities and Exchange Commission began an informal inquiry.

Gold climbed $1 to $369.40 an ounce, after having risen above $370 for the first time in about six years earlier in the session.

Market breadth was negative, with losers beating gainers both on the New York Stock Exchange, by about 3 to 1, and on the Nasdaq, by more than 11 to 5. Some 1.07 billion shares changed hands on the NYSE and 1.12 billion shares traded on the Nasdaq.

Bond prices fell, pushing the yield on the 10-year note up to 3.97 percent from 3.93 percent late Friday. Bond prices and yields move in opposite directions.

The dollar continued to lose ground against the euro, but rose modestly against the yen.

The war rumblings fueled buying in oil futures overnight, but light crude retreated in New York after the day's announcements, with its price falling 80 cents to $32.48 a barrel.

Overseas stock markets took a beating, unsettled by the increasing prospect of war in the Middle East. European stocks closed lower, while Asian-Pacific markets also lost ground, with Tokyo's Nikkei 225 index shedding 1.4 percent.