By Associated Press, 3/29/2003 20:00

Demonstrations around the world Saturday related to the war in Iraq:

More than 100,000 people protested in cities across Germany, including 30,000 people who held hands in a 31-mile chain between two northwestern cities.

Hundreds of women covered in black robes protested in San'a, Yemen. Some carried placards declaring ''the United States and Britain are the axis of evil.''

In the United States, 8,000 to 12,000 war supporters gathered on the steps of the Pennsylvania Capitol. Thousands also marched to support the military in Miami and on Cape Cod in Massachusetts, and a few hundred people rallied for U.S. troops in San Francisco.

About 15,000 anti-war protesters lay down in Boston streets to protest the war. Hundreds also rallied in Los Angeles, New York City, Paterson, N.J., and Boulder, Colo.

About 3,000 protested in Santiago, Chile, and 100 demonstrated in Caracas, Venezuela. One Caracas protester said of the U.S.-led coalition: ''Those wretched gringos decided to leapfrog the U.N.'s authority.''

Marchers in Rome hung black mourning banners from the city's bridges. At Vicenza in northeastern Italy, demonstrators threw red paint and flares at the walls of a U.S. military base where hundreds of paratroopers now in northern Iraq had been based.

15,000 turned out in Athens, Greece. Some protesters spattered paint on the road outside the U.S. Embassy and on the windows of a McDonald's restaurant.

Protests in Paris attracted about 10,000 people but turned violent when 20 youths mobbed a couple angry with demonstrators who carried pictures of Iraqi leader Saddam Hussein. The two were bruised and treated at the scene.

By NDUKA UZUAKPUNDU Sunday, March 30, 2003

THE United States-led unjust aggression against   Iraq is progressing as planned. But, if you are familiar with received war-time parlance, given the consuming mobilisation and the strategy made by Washington and its allies – in order to sink President Saddam Hussein – you are most likely to think otherwise. Suppose in the first 72 hours of the aerial bombardment of Basra and Umm Qasr by U.S. troops there was a gleeful and genuine beam of footage of broken Iraqi resistance – this time not just by the ubiquitous, Qatar-based Arab satellite television station – Al Jazeera – but also other influential broadcasters – like the BBC, CNN, ABC, NBC, CBS etc. – the language of the sitrep issuing from the U.S. Central Command post in Qatar, would have been cheeringly different: “the war is progressing beyond our wildest imagination.” And that could have been General Tommy Franks – the Kosovo veteran – who is in charge of the anti-Saddam aggression – speaking. But this war is not progressing as President George W. Bush, Defence Secretary Donald Rumsfeld and Secretary of State General Colin Powell may have expected. It is too unjust and morally indefensible to be.

Iraq - Saddam and his associates in the alleged weapons of mass destruction (W.M.D) saga - as the pre-war ranting went - would be tested within days. That has not been. And yet Rumsfeld did say that Iraq would not be too much of a problem, even if Washington were to take on North Korea at the same time. The friends of Washington are eagerly waiting to see a demonstration of that. While he said Iraq is a new kind of war, neither Washington nor London knows how to fight it. Bush may have - in the weeks ahead - to shift position, for obvious reasons: Iraq is not as backward as Afghanistan; Iraq is about four times the size of Afghanistan; 24 times Kuwait; its people are a justifiably proud lot driven by their 8,000-year long history of civilisation, which has been nurtured by the Euphrates and the Tigris and their leading geo-strategic position in the Arabian Gulf region.

The breadth of Iraqi resistance to the aggression, so far, suggests the inaccuracy of the pre-war intelligence about Iraq gathered by Washington and its regional allies. Iraqis are, for all these traits - and many more - unlikely to bow soon. Bush and his distinguished ‘War Council’- including the famous Congressman from North Texas, alias Tony Blair - are well into plans in readiness for a long, stretching aggression against Iraqis. Almost too early in their self-appointed errand, they have come to realise that Iraq holds forth a telling feature that is quite distinct from Grenada, Haiti, Somalia, Kosovo and Afghanistan. But, like Somalia, there is some unveiled unease in the Bush camp that the casualties: 18 U.S. troops missing in an ambush in An Nasiriyah; the felling of British planes by friendly fires flung from American Patriot missiles; the beamed confessions by some American soldiers that they were unwilling - as opposed to illegal - combatants in the anti-Saddam war; that, indeed, they had nothing against the Iraqis; are developments too unhealthy for the Coalition’s cause.

Still, the latest intelligence forecasts a crippling soar: as ‘another’ anti-Vietnam civil disobedience brews on the U.S’s Atlantic seaboard, a crop of unidentified U.S. troops in Umm Qasr may be plotting to jam the Coalition forces’ central communication lines, disable some B-52 war planes and waste the head of the unjust war out there in Qatar. These are Americans, augmented by the consuming anti-war protests and the fact that theirs is an outing not backed by the resolution of the United Nations Security Council, who have come to realise the duty they owed their conscience - and the cause of justice and peace - that Iraq is decidedly a war of blame. These are Americans who figure that against the run of their country’s war history, the aggression against Iraq would not win them the hearts of Iraqis whenever the din of war subsides. They would rather act now, the way they have planned - by April 9 - so some intelligence say - if only to be seen as having expressed their disapproval of the aggression.  

Cultivated patience 

Meanwhile, American voters and tax-payers are waiting - with some cultivated patience - to task Bush over his promise to send American sons and daughters to war fronts to conquer and amble out unscathed. There is already a build up to an opportunity to that effect right inside Iraq - an opportunity which Afghanistan was, understandably, not magnanimous enough to offer: Several families of captured U.S. legal combatants have been trooping to Fort Bliss - the base of the 507th  Maintenance part of the 111th Air Defence Brigade, in Texas - whence some of the prisoners of war came. Bush expects that their Iraqi captors would treat them humanely, because they are as good as the illegal combatants who have refused to evacuate Guantanamo, because of the unimaginable comfort and bliss they have found on the island; something that wealthy and magnanimous Afghanistan was too stingy to offer them. Said Bush on his return last week to the White House from Camp David: “We expect them (the American POWs) to be treated humanely, just like we’ll treat any prisoner of theirs ... If not, the people who mistreat the prisoners will be treated as war criminals.”  

But for ordering a  criminal aggression  against the people of Iraq, Bush and his associates shall be treated as heroes. The POWs have been shown on Arab, American and British television stations. But, as the spokeswoman of the International Committee of the Red Cross (I.C.R.C), Nadu Doumani, said, the showing of the POWs on television violates Article 13 of the Geneva Conventions, which says POWs should be protected from public curiosity. The unanswered questions posed by Article 13 – in its assumed magisterial disposition are: What is the just definition of ‘curiosity’? Who defines it? Is it Bush, Blair or Saddam?  Because of the aggression against Iraqis, Article 13 ought to be tolerant of certain informed infractions. Although, it is true that those who crafted Article 13 were never that clairvoyant to foresee such obvious falsity that could lead to an unjust aggression, it is, nonetheless, imperative they should retire to their chambers and reflect on all possible unjust future war situations - including what is left of Bush’s “axis of evil” - Iran and North Korea - and loosen it up with some provisos, in a transparently liberal fashion, to accommodate some informed extremities.

In the face of the offensive against the Iraqis, Article 13 is indefensible. It is archaic and unrealistic. If war is not about propaganda - propaganda that, in some instances, is steeled by the footage of POWs and laboriously stuffed body bags, of what relevance is Article 13?. For now, Article 13 should be rested. Here is an unjust war for which, in fairness, the Iraqis should be allowed to press their case by any means within their reach. As it presently is, Article 13 is akin to an unjust crusade to tamper with press freedom, just in case any newspaper naughtily publishes the truth with supposedly an unjust intent to embarrass a public officer. It is morally offensive and unjust to crave a veil - as Article 13 seeks, in every material particular, to do - for the faces behind an unjust aggression. Iraq is enough as an unjust war milieu for which it will be more tolerable to beam the faces of POWs,  than those of lifeless victims. If war has nothing attractive to offer, Article 13 ought to be ambitious enough to ban it. By implication, there will be no more POWs – and the I.C.R.C. will be saved the discomfort of some television stations exposing legal combatants to curiosity. Regrettably, Article 13 is, unjustly, about making the media one of the countless casualties of the war.

Presently, the Saudi crown - torn between its loyalty to Washington and the anger of public opinion against the war - is pondering over what it would look like if the Americans should topple Saddam from his oil empire. Would it corrode the mighty influence of the Organisation of Petroleum Exporting Countries (OPEC) in global oil politics? Would it be nunc dimitis for the cartel? Would Washington, thereafter, steep itself in creating a permanent glut in the global oil market to cheapen the price? Would it then have transmitted to fruition the threat of the crude Republican Nixon administration, during the 1973 crude oil crisis, when a barrel sold for $40, that those oil-exporting Arab countries - and their accomplices in the oil cartel - who whetted the attendant embargo - shall, whenever the United States found an alternative to Arab petroleum, quaff their hard currency earner. Perhaps. That was in 1973. This is 2003. Some 30 years later. Is crude Nixon’s oil prophecy about to come true? The unjust war against Saddam casts Republican Washington as being too crudely ambitious. It is no longer satisfied with its indisputable leadership of the post-Soviet, unipolar world, especially in the field of space and war technology, it also wants, with the crudest of intentions, to control the supply and demand of the crudest and commonest commodity in international trade. Iraq might well be it: since the bombing of the World Trade Centre and The Pentagon on September 11, 2001, the Afghan campaign, USS Cole and growing Arab unease and open criticisms of U.S. stagnating policy on Palestine, amongst others, Washington had been in search of an alternative source of cheap crude oil – to supplement what it gets from such short hauls from neighbouring Mexico and Venezuela. And because Washington realises that it cannot, for too long, rely on a local Arab instrument to take care of its oil interests in the Gulf – just as the experience with the Shah has shown – it is beginning to eye the treasures of the Gulf of Guinea.    

Clinton administration

  Although the Washington of the mid 90s was well positioned to take on Saddam, soon after the Iraqi troops were chased out of Kuwait, the Clinton administration was pretty wary not to besmirch its image, should it go beyond the brief of the Security Council resolution. The Bush administration says it has an anti-Saddam war plan that would make for an easy encounter with Iraqi troops, with a minimum human catastrophe. Independent reports say the opposite. Today’s U.S.-led aggression against Iraq, in spite of Saddam’s recorded co-operation with the arms inspectors, will surely have the crudest of consequences on both sides.

There was no justification for Bush and his associates to have read the Iraqi case as one of inaction, on the part of the Security Council, which, it is true, characterised its handling of the abuse of human rights and crimes against humanity in the Balkans, and lawlessness and terror in Afghanistan to defend his slipping American troops into a unilaterally declared war. Indeed, British Middle East specialist and journalist, Patrick Seale, charges Washington with deceitful propaganda to justify the aggression, saying Washington has not proved its accusation that Baghdad was developing weapons of mass destruction and had links to terrorist groups. The real target of the war, he says, is to make U.S. supremacy prevail on a strategic oil-rich region, and to protect Israel’s regional superiority and its monopoly over weapons of mass destruction in the Middle East. 

The unjust aggression against Iraq will surely  draw upon the Middle East and certain parts of the world, including the U.S. and Britain, humanitarian crisis and mighty pestilence of Biblical magnitude - the kind that would stretch Washington awfully thin. Washington may not find a post-Saddam Iraq and its breathing oil deposits to control. Baghdad, by some accounts, may turn out to be another Stalingrad for the Coalition forces. The historian, Anthony Beevor, speaks of Saddamgrad. It is likely that Iraq, thanks to an informed Arab conspiracy to thwart Washington’s unjust designs, will be balkanised into ungovernable counties – a la Somalia, until all foreign troops disengage from the territory. Before then, you cannot rule out the possibility of some of the hard by complacent, pro-American and undemocratic cronies being swept away. Put differently, this violent campaign against Saddam that is not blessed by a resolution of the Security Council could lead to the disappearance of Iraq from the world map, if only temporarily. And this is one situation that would surely make the retrieval of a belle epoque, a herculean burden.

Posted on Sat, Mar. 29, 2003 DIANE SUCHETKA Staff Writer

CARY - Eight war protestors, including a UNC Chapel Hill professor, are awaiting trial in Raleigh for refusing to leave U.S. Sen. John Edwards presidential campaign headquarters last month.

A Siler City peace activist is serving six months in prison for splattering blood on doors to the Pentagon.

Hundreds of students have walked out of classes at UNC Chapel Hill and Duke University and thousands of protestors have gathered at the state Capitol in Raleigh.

Charlotte may have more residents than any other city in North Carolina, but the stronghold of North Carolina's peace movement is in the Triangle.

N.C. activists say their numbers have shot up since the United States began bombing Iraq. And they expect their movement to continue to grow whether the war ends quickly or not.

They'll talk about that growth, among other things, at a statewide strategy session in Charlotte today.

About 75 peace activists are expected in Charlotte for the 10 a.m. meeting, at Wedgewood Baptist Church. They'll break at noon to attend an anti-war rally at Independence Park, at East Seventh Street and Hawthorne Lane.

One reason Triangle peace activists feel certain their political action will continue even if the war doesn't is that people are joining the movement there for secondary reasons.

Men and women, many of them minorities, are speaking out against the war because they're worried about the erosion of civil rights they see in the Patriot Act, says Rañia Masri, a human-rights advocate who oversees peace research and education at the Institute for Southern Studies in Durham.

Among other things, the act allows the government to detain any foreigner the attorney general says is endangering national security.

Other activists are coming out because they're concerned about the billions of dollars in tax money the war could take away from social programs, education and health care.

"People are connecting this war with many other issues," says Masri, who serves on the national board of the grassroots group Peace Action. "And when we have a peace movement that's connecting all these issues, it's a peace movement that's not going to go away. We're going to continue to organize and continue to grow until these issues are resolved."

Those secondary issues are making the movement more diverse too, says Patrick O'Neill, one of the eight protestors arrested in Raleigh and co-founder of North Carolinians for Alternatives to War.

That diversity is evident in Charlotte's war protests, too. After-work gatherings at Marshall Park include Latinos, Asians and African Americans; children as young as 10 and adults in their 80s. Taken together, those working for peace, O'Neill says, represent a large cross-section of the American public. He points to religious leaders from many mainstream denominations who have made statements against a U.S. attack of Iraq. To the dozens of U.S. cities and counties that have passed resolutions opposing the war. And to the labor unions that have taken a stance against a U.S. attack of Iraq.

At the same time, public support for the war remains strong. At least seven in 10 back the effort now that U.S. troops are fighting in Iraq, according to a CBS News poll.

Back in the Triangle, 70-year-old Cary peace activist Bill Towe says interest has risen since the bombs began falling. Now, the coordinator of N.C. Peace Action, the state affiliate of the Washington-based group once known as SANE, is getting 100 to 150 e-mails a day, at least twice as many as before the war began.

He hears from people who are concerned about U.S. foreign policy in general; about America's involvement in Columbia, Israel, Korea, the Philippines, Venezuela. "When the Vietnam war ended, there was a decline in the peace movement," says Towe, a political activist for more than 40 years. "Now with all these issues it won't dissipate like it did in the past."

There are reasons the peace movement is stronger in the Raleigh area than in Charlotte.

Charlotte is a more-conservative banking town, with a smaller concentration of college students. It has less of a history of activism, fewer labor unions and political action groups, experts say

Charlotte also has what Tom Hanchett, staff historian at the Levine Museum of the New South, calls a culture of civility.

"Protesting anything is just not seen as civil in this part of the South," Hanchett says. "Here the civility tends to put a lid on any kind of protest."

Diane Suchetka: (704) 358-5073; suchetka@charlotteobserver.com.

<a href=www.dailytelegraph.co.uk>By Alice Thomson (Filed: 29/03/2003)

It's 3.30pm at Terminal 2, Heathrow. The arrivals lounge is full of rugby players, businessmen, a stag party, the traffic of a Friday afternoon. In the middle stands a man with ruddy cheeks and gnarled hands, looking like a Dutch bulb grower in his crumpled suit.

He may look innocuous but, in the next week, Carel de Rooy will be meeting presidents, prime ministers, ministers, princes and paupers in his quest to raise £106 million. As Unicef's representative for Iraq, he will be flying on to Brussels, Geneva, Germany, Ireland, Italy, Spain and France to plead for money for Iraq's 12 million children in the charity's largest ever emergency appeal.

"The Irish," he says, "have been fantastic in their support. The French are the least interested." London, where he is meeting Clare Short, is his second stop.

"Less than a week ago I was in Baghdad's marketplace searching for bread," he says. "I don't know when I'll go back. I've left 200 of my staff there, delivering babies, trying to keep water flowing, building latrines in camps, distributing £2 million of high-protein biscuits and milk formula, inoculating as many children as we can."

The remaining staff, all Iraqis, are trying to ignore the war as they check the orphanages and the generators that they have installed in the water treatment plants. Meanwhile, Mr de Rooy has flown to Turkey, Syria, Jordan, Iran and Kuwait in the last four days, setting up camps in case refugees flee over the borders.

"If the support doesn't come we'll have a catastrophe of unforeseeable dimensions," says the Dutchman. "Nearly 1.7 million people have been without water for four days in Basra and we're already seeing a thin column of refugees crossing the river. It's like watching a colony of ants on the move after someone has stepped on their nest: weary but determined. I get that sickening feeling . . . here we go again."

Mr de Rooy, who is 51, has worked in Colombia, Venezuela, Nigeria, Brazil and Ivory Coast. "Iraq is different," he says. "Seventy per cent of the population is urban. They don't have a plot of land to grow tomatoes or keep chickens. They are used to a higher level of comfort - running water and electricity. There are few wells to keep them going.

"Almost all of them have become reliant on state hand-outs to eat; now they are stuck. There is five weeks of food left in the country. This is not about the reconstruction of Iraq - it's about survival."

Nearly 80 per cent of Iraqis are partly dependent on the oil-for-food programme; more than 60 per cent receive all their food from the state. "Twenty-three per cent of children are chronically malnourished already. If they get diarrhoea, they may die."

Mr de Rooy has spent two years in Baghdad. "There's been a crisis here since 1985, with the Iran/Iraq war. Then, there was the invasion of Kuwait that sucked the country dry, and after that sanctions.

"In the mid-1980s a professional would earn about 120 dinar a month, and about three per cent of that would be spent on protein. Now they earn 1,500 dinar but two chickens cost almost that much. That means instead of eating protein every day, they may have it three times a year. So 60 per cent of the women now have anaemia, half of all newborn babies have a low birth rate, 20 per cent of pregnancies go wrong."

The statistics are reeled off with dizzying speed. "Only countries such as Mozambique have worse rates of respiratory infections and chronic malnutrition among small children - and they have to contend with Aids. Over the last 10 years alone child mortality in this country has risen by 160 per cent - the biggest leap in the world. One in eight under-fives now dies. Yet Iraq is the second largest oil producer in the world. It's ludicrous."

The education system has fallen apart. "Each school," says Mr de Rooy, "has three shifts, so children are taught for only two hours a day. Teachers earn $5 a month and 25 per cent of children never go to school at all. Instead, they start working at the age of five in factories or as apprentices. For girls, it is worse - more than 33 per cent of girls stay at home to help their mothers."

It makes him want to shout: "It doesn't have to be like this!" Twenty years ago, Iraq had the third highest standard of living in the Middle East, out of 16 countries. Now, it has dropped to the bottom of the league.

But Mr de Rooy insists that he is still optimistic. "Iraq is a very secular state, and quite tolerant. These used to be educated, sophisticated people with a cosmopolitan view of the world. There is still a large middle class, even if they are starving.

"I have great friends in Baghdad - engineers, architects, bankers - all desperate to work. Some of the four million who emigrated might return. Iraq has the money from oil. It has a chance."

Baghdad, he says, may now be a dilapidated city, but it still has a sense of dignity. "You see that picture on television of the ragged skyline but you don't see the people below, desperately trying to keep their rooms clean and their families washed. There are few cafes left, but they are amazingly hospitable on their small piece of floor."

Iraqis, he says, are not corrupt. "They were called the Germans of the Arab world - they are naturally very straight and strict. I grew up in Latin America, so I know all about corruption. In Iraq, they don't steal the rations we supply. The country can recover quickly: it's got good people, spirit and resources."

He is too nervous to comment about the war in case it jeopardises the work of his team still in Baghdad, but he was in New York on September 11 and as soon as the war against terrorism began, he thought: Saddam's had it.

"My family were in Iraq but I got them out last year. My 15-year-old wasn't frightened but he wasn't learning anything with only two hours of school a day, so I sent them back to Brazil where I grew up. I saw my wife and my children at the beginning of January, but I'm not sure if I'll see them again this year.

"After this fund-raising, I'll go straight back to Iraq. I do feel bad that my family takes second priority but the Iraqi children have to come first."

His nightmare is that if the war intensifies, not only will he be unable to return but children will start dying from malnutrition and diarrhoea. "Then, there will be no point in discussing a future for Iraq. The oil-for-food programme has got to be reinstated. It was a disaster because it made the people dependent on Saddam but now it is all they have."

Both his parents fled Rotterdam after being bombed during the war. "My parents came from relatively privileged backgrounds but I have enormous sympathy for refugees," he says. "If possible, it is always better to help them remain in their own homes; otherwise, they will never feel they belong anywhere."

At university, he studied geology and specialised in water treatment, which led him to Unicef. "I found myself in remote villages, building wells in Africa. I became hooked on helping the vulnerable."

Working with Unicef after the earthquake in Colombia, the floods in Venezuela, the famine in Ivory Coast and the earthquake in El Salvador must have prepared him well for any disaster.

"They were all natural disasters - we just got on with it," he points out. "This is far more tortuous - it's a man-made hell. It is hundreds of earthquakes, thousands of volcanoes.

"This is like watching an earthquake and then being forced to sit on your hands while children and women are slowly, silently smothered to death over a decade."

Donations can be made by phone (08457 312312) or online at www.unicef.org.uk

28 March 2003: Attempts to deliver aid 'a disaster' 28 March 2003: Thousands flee from Basra 26 March 2003: UN wrangles halt aid appeal as Iraqis' food stocks dwindle 26 February 2003: Two million Iraqis could become refugees, says US 26 March 2003: UN wrangles halt aid appeal as Iraqis' food stocks dwindle 25 March 2003: UN ready to heal rifts with vote on oil-for-food aid External links     Unicef

By Leslie Fong

STOPPING the exodus of capital from America to Europe is the real reason why the United States started the war against Iraq despite worldwide objection, according to a Chinese think-tank chief with access to the leadership in Beijing.

In an analysis said to have been read by President Hu Jintao and other top leaders, Mr Wang Jian argues that the steady flow of money away from the US and into Europe over the past six months has raised the spectre of a financial meltdown in America.

With a financial system sustained largely by incoming funds invested in government bonds and other instruments, the US simply cannot afford to let the exodus continue.

It has to thrash the euro, which has been appreciating against the US dollar, and make Europe a risky place in which to park excess money, he says.

Mr Wang, who heads the government-linked Macroeconomics Society of China, asserts that the US has decided that a war in the Middle East, from which most major European economies except Britain import almost all their oil, would be the most effective way to rattle fund managers.

Iraq, with the second largest oil reserves in the world after Saudi Arabia but few friends even in the Arab world, as good as offered itself as the target.

No doubt higher oil prices will hurt the American economy too, but the impact will be much less severe as the US depends on the Middle East for only 26 per cent of its needs.

Further, he says, it has its own oil fields and holds in reserve enough to meet its needs for 150 days compared with just 90 days for Europe.

In any case, victory in Iraq will mean American control over the country's oil fields, however much the Bush administration may deny that it wants to do that. The US can then tighten the screws on Europe.

Mr Wang's paper has created a stir among the community of researchers and analysts in Beijing, many of whom advise the Chinese government on foreign policy and strategic issues.

It has sparked off deep discussions in such circles, which is hardly surprising as no one believes the reasons given by the US government for going to war.

In contrast, only a few accept that the US is really out to set up a kind of model government in Iraq to show that Islam is not incompatible with modernity as the West defines it - the essence of regime change.

Opinion is divided among those who have read and debated Mr Wang's paper.

Most agree with his argument that war in Iraq, especially a prolonged one that will push oil prices up and up, will hurt Europe and the euro more than the US.

But they see the likely collapse of the euro as a by-product of the war, not the reason for launching it in the first place.

'I think Wang Jian is being deliberately provocative. It was probably his way of drawing attention to some of the economic repercussions of the war,' says Dr Yuan Gangming, Senior Fellow at the Chinese Academy of Social Sciences' Institute of Economics.

Dr Tao Wengcao, deputy director of the academy's Institute of American Studies, thinks the economist is way off the mark.

However, a military analyst, whose writings are tracked by his American counterparts, thinks Mr Wang is closer to the truth than many would give him credit for. 'History will vindicate him,' he says.

At the heart of the economist's argument is the assertion that the US will do everything to defend its 'dollar hegemony' because it is now living off the paper on which it prints its greenback.

With a withering manufacturing sector, whose share of the GDP is down to 18 per cent last year from 24 per cent in the early 1990s, it has been relying on financial transactions for growth.

Weighed down by a trade deficit nearing US$500 billion (S$885 billion) a year, the US needs an inflow of US$1.3 billion a day in foreign funds to help pay the bills for the shoes, clothes and other goods it imports.

To put it bluntly, Mr Wang says, the US is paying for merchandise from China and elsewhere with pieces of paper not backed by gold or anything more solid than faith in the greenback.

These dollars are then re-invested in US Treasury bills, bonds and other 'virtual' assets which are no better than promissory notes or digital signals in a computer.

Given this fragility, once international capital moves out of the US in large enough quantities, America will be staring at a huge financial crisis in the face.

And the money is on the move.

Mr Wang says that between 1996 and 2000, US$2.3 trillion worth of international capital flowed into the US, 70 per cent from a Europe lacking faith in its own euro and mesmerised by the false dawn of the 'new economy' in America.

But with the collapse of the dot.com bubble, the discovery of massive corporate fraud, the Sept 11 disaster and an appreciating euro, the tables are being turned on the US.

Since the fourth quarter of last year, the net inflow of international capital into Europe has been exceeding 15 billion euros each month.

What worries the US even more is that the money stays there, in European long-term bonds and other securities.

Mr Wang says that it has not escaped the Americans that the war in Kosovo spooked fund managers.

Within 10 days of the euro's launch in 1999, it rose 19 per cent against the dollar. But once fighting in Kosovo started two months later, the exchange rate fell to as low as 0.8, a 40 per cent drop from peak to trough.

Noting that Iraq's peace-time oil production amounts to just two million barrels a day and Saudi Arabia alone can put three million a day more onto the market, he says the US can only keep up the pressure on the euro if it also moves against other producers.

He thinks Iran and Libya, known to have been supporting terrorist groups, will be next. But European countries like France and Germany, once alerted to what the US is doing, are bound to respond.

And so may begin a 21st century replay of what the imperialist powers did from the 18th century; only this time, instead of fighting for territory, natural resources and markets, the tussle will be for oil and investible funds.

'I hope my analysis is wrong because if it is not, then the consequences are horrendous,' he says at the end of his paper.

The military analyst has this to say: 'Yes, he is wrong, but only because Iran and Libya are not next - well, not yet.

'Watch Venezuela. Its oil exports were disrupted recently because of strikes and disturbances. Can one be sure there was no American hand behind these?'

• The writer is Editor-at-Large of The Straits Times.