• briefing asia infrastructure aug 15, 2006 • briefing asia energy aug 15, 2006

aid.
Across the Muslim world, thousands of people protested Israel`s actions in Lebanon after Friday prayers. In Amman, Jordan, at least 2,000 people marched to shout support for Hezbollah. And in Karachi, Pakistan, crowds burned an effigy of President Bush and U.S., Israeli and British flags.
In Egypt, protesters condemned Arab leaders for not speaking out in support of Hezbollah. Police beat some of the demonstrators with batons. We`ll have more on the crisis in the Middle East right after this news summary.
In Iraq today, at least 18 people died when gunmen attacked two Shiite neighborhoods south of Baghdad. It happened in Mahmoudiya, the same town where Sunni attackers killed 50 people earlier this week.
To the north today, U.S. forces in Baquba killed five people in a raid, including two women and a child. The U.S. military said the troops were fired on from the buildings. It said the people inside ignored warnings to leave.
And a U.S. Marine died in western Iraq. He was the 24th American killed this month.
Police in India today made their first formal arrests in last week`s deadly train bombings. Three suspects were taken to a court in Mumbai, formerly known as Bombay. A lead investigator said they could be involved with larger networks across South Asia.
K.P. RAGHUVANSHI, ATS Chief Joint Commissioner (through translator): We have definite evidence that these people are linked to terrorist activities. The bomb blast is a big conspiracy with many other players. Until the other accused are arrested, I cannot give any further details.
JIM LEHRER: The train bombings killed 207 people and injured more than 800 others.
Islamic leaders in Somalia called for a holy war today against Ethiopia. Witnesses reported Ethiopian troops had deployed in Baidoa. It`s the only city in Somalia where the U.N.-backed government has any control. Islamic militia forces have been spreading their control across Somalia.
The city of St. Louis got a little relief today from days of stifling heat. Temperatures eased slightly, but more than 300,000 homes and businesses still had no power after heavy storms on Wednesday. National Guard troops moved in to help yesterday.
On Wall Street today, the Dow Jones Industrial Average lost more than 59 points to close at 10,868. The Nasdaq fell 19 points to close at 2,020. For the week, the Dow gained more than 1 percent; the Nasdaq lost nearly 1 percent.
And that`s it for the news summary tonight. Now, the Middle East fighting; and the Rice mission; the oil markets; and Brooks and Oliphant.
(BREAK)
JIM LEHRER: The tenth day of the fighting in the Middle East. We have two reports. The first is from Julian Manyon of Independent Television News. He traveled from Beirut south to Tyre, Lebanon, today.
JULIAN MANYON, ITV News Correspondent: The roads we took were deserted and dangerous. In normal times, Tyre is an hour`s drive from Beirut, but now virtually all the bridges are smashed by the Israeli air force and we had to make a detour deep into the mountains.
As we drove further south, the roads emptied. Not far away, a cloud of smoke rose from an Israeli air strike. Normally bustling Nabitir (ph) was a ghost town. No one was traveling in our direction. But as we approached Tyre, car loads of refugees were flooding out.
At the entrance to Tyre, a giant bomb crater almost severed the road. Beyond it, a city under siege by the Israeli air force. Columns of smoke rise from attacks on nearby villages, and one of the city`s largest buildings has been blasted by an Israeli bomb.
Today, the Lebanese authorities took drastic steps to deal with the number of corpses overwhelming the city`s morgue. Army lories brought some 80 dead to a hastily dug mass grave. The normal tradition of family burial could not be observed, though each coffin was marked with the victim`s name so the bodies can be recovered and reburied later. The small coffins were those of children.
Every day, the human cost of this Israeli operation is becoming more apparent. The Israelis insist that they choose their targets carefully, but the dead and injured are overwhelmingly civilians.
At the city`s hospitals, doctors are struggling to deal with casualties streaming in from the surrounding areas.
DR. BASSAM MTREK, Jabal Amal Hospital (through translator): I`ve seen just civilians, children and women, most of them children and women, around 60, 65 persons are children.
JULIAN MANYON: Overcome by grief, a woman whose husband was killed in an air strike. She has not yet found the courage to tell her children that their father is dead.
The Israeli air force is dropping bombs just outside the city of Tyre, but it`s also dropping leaflets like this one, warning local people to leave their homes and go beyond the Litani River to the north over there.
They say that their homes and villages here in the south are being used as staging areas for terrorist attacks; they say their lives are in danger. The leaflet is signed quite simply, "The state of Israel."
Many have fled, but some are refusing to leave. In a bomb shelter in Tyre, 40 people from seven different families hide together in stifling heat with no running water and no toilet. Normal life is breaking down in this city. And with the Israeli forces striking ever fiercer blows, no one knows what the future will bring.
JIM LEHRER: Next, an ITN report from Israel from Juliet Bremner.
JULIET BREMNER, ITV News Correspondent: Israel can`t stop the damage being inflicted on it by Hezbollah. Another volley of Katyusha rockets lands in Haifa. Another 19 of its people are injured, a clear signal from the militant fighters that they`re still a force to be reckoned with.
The Israeli response was to put its impressive military machine into top gear. Columns of tanks headed to the border. Thousands of reservists are being called up, all indications they`re getting ready for a big push on the ground.
Even for a country used to defending itself, Israel feels particularly under siege at the moment, being attacked from all sides. Its security forces are having to fight off Hezbollah in the north, Hamas on the Gaza Strip, and trying to stop suicide bombers coming in from the West Bank.
The funerals of six soldiers lost in the last three days are a stark reminder of the cost of fighting on all fronts. The men were killed as they tried to destroy Hezbollah bunkers across the border. There will be more mourning like this if they push further into Lebanese territory.
The Israeli government is anxious to stress incursions into Lebanon don`t amount to an invasion.
MARK REGEV, Foreign Ministry Spokesman, Israel: No one in Israel wants to reoccupy Lebanon. No one in Israel claims an inch of Lebanese soil. On the contrary, we want to be surgical. We want to deal with the terrorist threat posed by Hezbollah, and then we want to leave.
JULIET BREMNER: Opinion polls show that a staggering 95 percent back the response to Hezbollah`s attacks. I discussed the crisis with lawyer Sefi Melamed and his friends in a liberal suburb of Tel Aviv.
KARIN MELAMED, Tel Aviv Citizen: So we`re going to fight until the end. I have three boys. I have two boys and another one, and I want to finish it. I want not to going to be a war in this country. It needs to finish.
SEFI MELAMED, Tel Aviv Citizen: Of course it`s right, because the situation right now is not very good for us, and we have to put an end for it for once and for all.
JULIET BREMNER: Politicians must hope their people stay as resolute if more coffins start to return from the frontline.
(BREAK)
JIM LEHRER: Now, the United States prepares to get involved. Ray Suarez has that part of the story, beginning with the day`s diplomatic developments.
RAY SUAREZ: After two days of meetings with United Nations officials in New York to discuss the ongoing crisis in the Middle East, Secretary of State Condoleezza Rice returned to Washington to outline U.S. strategy and her trip Sunday to the region. The first stop is Israel.
CONDOLEEZZA RICE, U.S. Secretary of State: It is important to remember that the cause of the current violence was Hezbollah`s illegal attack from Lebanese territory. It is unacceptable to have a situation where the decision of a terrorist group can drag an entire country, even an entire region, into violence.
RAY SUAREZ: Fighting continued to rage between the Israeli military and Hezbollah, as the U.N. Security Council met again today to discuss the crisis.
CONDOLEEZZA RICE: Today, the United States renews its call for the immediate release of the abducted Israeli soldiers. And as Israel exercises the right of any sovereign nation to defend itself, we urge Israel`s leaders to do so with the greatest possible care to avoid harming innocent civilians and with care to protect civilian infrastructure.
We do seek an end to the current violence, and we seek it urgently. More than that, we also seek to address the root causes of that violence so that a real and endurable peace can be established.
RAY SUAREZ: Secretary Rice says she plans to meet with Israel`s prime minister and, in Rome, with members from the U.N. Security Council and Arab states. She defended her decision not to meet with any Syrian or Hezbollah officials.
CONDOLEEZZA RICE: First of all, Syria knows what it needs to do, and Hezbollah is the source of the problem. The issue here is that, in Resolution 1559 and ever since, the world has spoken to the need of Lebanon to be able to function as a sovereign government without the interference of foreign powers. That`s why Syrian forces were told to leave Lebanon.
The resolutions have insisted that the government of Lebanon needs to be able to extend its authority over all of its territory, and you can`t have a situation in which the south of Lebanon is a haven for unauthorized, armed groups that sit and fire rockets into Israel, plunging the entire country into chaos, when the Lebanese government did not even know that this was going to be done.
RAY SUAREZ: The secretary also acknowledged that other world leaders, like U.N. Secretary General Kofi Annan, had called for an immediate cease- fire, but she said that would not be good enough.
CONDOLEEZZA RICE: ... I can guarantee you, if you simply look for a cease-fire that acknowledges and freezes the status quo ante, we will be back here in six months again, or in five months, or in nine months, or in a year trying to get another cease-fire, because Hezbollah will have decided yet again to try and to use southern Lebanon as a sanctuary to fire against Israel.
RAY SUAREZ: Hezbollah not only has a well-armed militia based in Lebanon, it`s also a political party. Hezbollah members hold cabinet and parliament positions in the Lebanese government. Secretary Rice said those members failed to act responsibly.
CONDOLEEZZA RICE: If, indeed, Hezbollah went without the authority of the Lebanese government, violated every conceivable international norm -- not to mention a number of international U.N. Security Council resolutions -- and didn`t bother to tell the members of the Lebanese government. So, obviously, they didn`t act in a responsible way in their political cloak.
JAMES ROSEN, FOX News Correspondent: Madam Secretary, as you mentioned, a key element of Resolution 1559 calls for the dismantling of terrorist militia groups inside Lebanon by the sovereign authority of that government.
What have you heard from your discussions with the Lebanese that would explain why they have made so little progress on that up to now? And what you think would change in the next week or two in the political framework that would suddenly allow them to make progress on that?
CONDOLEEZZA RICE: Well, clearly, this is a young government that does not have the capacity to do everything that was anticipated in 1559; it`s just the case.
What we have to do is to help create a framework in which, first of all, the end to the violence would push forward the sovereignty of the Lebanese government and the deployment of Lebanese forces southward, with some kind of international assistance, perhaps significant international assistance. And then we have to continue to work with this government on the political front.
But what I said, James, is that -- in answer to Lisa`s question -- is that it is now clear why 1559 anticipates a circumstance in which you cannot have people with one foot in politics and one foot in terror, because that Hezbollah sitting within the Lebanese government, as ministers within the Lebanese government, would launch an attack without the knowledge of the Lebanese government, that then plunged the Lebanese people into the circumstances that they are, unfortunately, now in.
That`s why 1559 has wisdom, but we will work on a political framework to help the Lebanese to fulfill those terms.
RAY SUAREZ: Rice said the Syrian government, which has long backed Hezbollah, must make a move.
CONDOLEEZZA RICE: The Syrians have to make a choice. Do they really wish to be associated with the circumstances that help extremism to grow in the region? Or are they going to be a part of what is clearly a consensus of the major Arab states in the region that extremism is one of the problems here?
In this sense, I would just ask you to look back on what is being said by some of these Arab states. Everybody wants the violence to stop; there is no difference there. But this is different than times in the past when there has been a reflexive response from the Arab states.
This time I think you`re getting a very clear indication of where people think the problem is, and Syria has to determine whether it`s going to be a part of that consensus or not.
QUESTION: Madam Secretary, aren`t you concerned that the delay in halting the fighting and the loss of many civilian lives in Lebanon will hamper your efforts to win the hearts and minds of the Arab world?
CONDOLEEZZA RICE: I`m concerned about civilian casualties, because I`m concerned about civilian casualties. Nobody wants to see innocent civilians caught up in this kind of fighting.
And it`s why we are very determined to do more about the humanitarian situation. It`s why we have talked so determinedly and so frequently with the Israelis about restraint in their operations. It`s why we`ve worked to get the humanitarian corridors opened.
This is a terrible thing for the Lebanese people. The unfortunate fact is that, if we don`t do this right, if we don`t create political conditions that allow an end to the violence, to also deal with the root cause, deal with the circumstances that produced this violence, then we`re going to be back here in several months more.
RAY SUAREZ: Before she leaves for the Middle East, Secretary Rice and President Bush will meet Saudi officials to discuss the crisis.
Some analysis now from Martin Indyk, who was assistant secretary of state for Near Eastern affairs and twice U.S. ambassador to Israel during the Clinton administration. He`s now director of the Saban Center for Middle East Policy at the Brookings Institution.
And Robert Malley, who was special assistant to President Clinton for Arab-Israeli affairs and also served on the National Security Council staff, he`s now the Middle East program director at the International Crisis Group, which promotes conflict prevention and resolution.
Mr. Ambassador, what`s your overall assessment of the new Rice initiative to head over to the region and start trying to straighten things out?
MARTIN INDYK, Saban Center for Middle East Policy: Well, I think it`s about time. I think it was a mistake for the secretary of state at least not to send some special envoy out there earlier than this, because it was important to show that the United States is engaged in the effort to try to shape a cease-fire package.
We can get into what the package should be, but it`s more than the cease-fire as she suggests, but we needed to be out there and engaged early on. In previous administrations, all the way back to the Reagan administration, we would send, when the Lebanon crisis blew, we would send a special envoy out or an assistant secretary, just like we had U.N. envoys in the region.
But now that she`s engaged, I think that it`s very important that she put together that package. I think there`s a consensus that is forming in the international community, and even between the Israeli and Lebanese governments, that would put together a credible package that would link American concerns, Israeli concerns, and the concerns of the Lebanese government.
RAY SUAREZ: Robert Malley, what do you make of what you heard this afternoon?
ROBERT MALLEY, International Crisis Group: Well, I mean, I agree that it was about time that we involved, because the United States, frankly, has been missing in action, not only in the region as vital to our interest, but at a time when the conflagration is about as bad as it has been in many, many years.
The one thing I would emphasize, though, is for the secretary of state to go there and not say that reaching an immediate cease-fire is a priority is getting things backwards. I understand the concern that, if you have a cease-fire, and nothing else happens, then you may go back to the status quo ante.
But if you don`t have a cease-fire now, all the risks that we`re seeing, more civilian casualties, Hezbollah getting stronger, not weaker, the Lebanese central government getting weaker, not stronger, the Arab world as a whole -- forget about the governments who really don`t represent their people on this -- but the Arab world as a whole turning more anti- American, more anti-Israeli. All of that will happen.
You get a cease-fire, then you roll up your sleeves and you try to get to the roots causes, as Secretary Rice said, to try to make sure this doesn`t happen again.
RAY SUAREZ: Well, you heard the secretary refer to the cease-fire as a false promise which can guarantee future violence. And here we are on the tenth anniversary of the last Hezbollah-Israeli border conflict, where a cease-fire was reached, and maybe she had that in mind when she said those words.
How important is that cease-fire, when you think that what you really need to do is settle the whole thing, as one of our Israeli men on the street said, once and for all?
ROBERT MALLEY: The notion that you could settle this once and for all, and quickly, within the time span that`s going to be important for the civilians on both sides who are dying, I think is an allusion.
I would say, let`s distinguish between two things: Number one, cease the fire, and that is critical for all of the reasons I said before, the most important, of course, being that civilians are losing their lives everyday.
But then you need, yes, to get to the deeper roots of the conflict. It`s not just the fact that Hezbollah is an armed organization, although that`s a very important piece of it. It has to do with the makeup of the Lebanese political system, because Hezbollah is a representative of the largest constituency, the Shiites, and they don`t feel represented, which is part of hwy they have rallied behind an armed organization.
It has to do with the role of Syria, with the role of Iran, with the lack of Arab-Israeli peace. Those are the root causes. So I`m all in favor of that, but let`s get the cease-fire in place, and then there`s no reason to abandon the field. The United States should be more active diplomatically at that point and see whether we can get to those root causes, which would ensure that we don`t have the recurrence of the violence a year down the road.
RAY SUAREZ: How do you respond to Robert Malley`s criticism of the rejection of the Bush administration of short-term measures?
MARTIN INDYK: Well, I think it`s unrealistic to get an immediate cease-fire. I think that it is going to be important to put the elements together, which includes a cease-fire, the deployment of the Lebanese army to the south, so that Lebanese government`s authority will be extended there, and the friction between Israel and Hezbollah will be removed, and an international force put in place to back that up, plus a whole lot of other things like donor fund for the reconstruction of Lebanon, dealing with some of the longer-term issues, like the Shebaa Farms territorial dispute, and of course there`s the question of the kidnapped soldiers.
But all of those things have to be put into a package. And while that package is being put in place, I think realistically what`s going to happen is that the Israelis are going to be moving into the south and trying to push what`s left of the Hezbollah cadres out of the south, beyond the Litani River, about 20 miles north, and to destroy the infrastructure that Hezbollah has put in place in the last six years since Israel withdrew.
That will create a kind of vacuum which the Lebanese army, backed by an international force, could then enter, and I think that would lay the basis for a cease-fire.
RAY SUAREZ: But it`s been hinted at by various people in the Lebanese government that, if Israel mounts a land offensive into southern Lebanon, they`ll throw in their lot with Hezbollah. They won`t just sit aside and let their territorial integrity be compromised.
MARTIN INDYK: Well...
RAY SUAREZ: Doesn`t that threaten a wider war?
MARTIN INDYK: Their territorial integrity is already compromised. It`s in particular compromised by the fact that Hezbollah seems to feel free to operate as a state within a state, particularly in southern Lebanon.
I don`t think the Lebanese armed forces are going to really engage. If they do, it`s for the sake of their own credibility, which is not a bad thing anyway.
And I don`t think the Israelis are going to launch a massive ground invasion. I think they`re going to go in, in selected places, with large numbers of troops to try to deal with the situation, and then get out, as we heard in your earlier piece.
But the critical problem here is we can get the Lebanese government, and the Israeli government, and the international community behind a cease- fire with these kinds of elements in it. How do we get Hezbollah to go along with what the secretary of state is talking about?
Because there the challenge is that they are going to have to leave the south and agree not to come back in, stop the rocket fire which can go over the southern buffer zone, and agree to implement 1559, which calls for their disarmament. In other words, this whole effort is going to depend on Hezbollah cooperating in its own demise as a, quote, "resistance operation," and I don`t see how that`s going to happen.
RAY SUAREZ: Well, Robert Malley, you have sources inside southern Lebanon. What are you hearing about Hezbollah`s intentions, its strategic goals at this point in the conflict?
ROBERT MALLEY: Well, first let me react to what Martin said, because I think in what he described is the answer to his own question. If before you get a cease-fire, you need to have in place the deployment of the Lebanese army to the south, an international force, the release of the prisoners, discussion of the Shebaa Farms, people are being to be dying for a very, very long time. So I think that`s what is unrealistic, if you really want to try to move this relatively urgently, as Secretary Rice herself said.
Now, what we`re hearing -- and of course, we do have people, the International Crisis Group has people on the ground -- Hezbollah right now is not at all feeling that it has to surrender or in any way accept the terms that Secretary Rice has put on the table.
They feel that their ability to fight has not at all been affected; they feel that public support for them is growing; they`re waiting for the day that Israeli troops are going to come in.
Now, all of this could be part of the bravado and sort of the self- delusions of an organization that`s under attack and is waging attack, but it`s important to look at how they`re looking at it and how they see things. Because if they see it that way, that means that all of these things we`re talking about -- getting them to disarm, allowing the Lebanese army in -- and, by the way, that Lebanese army has a lot of Shiites who are not about to attack Hezbollah.
So they don`t feel that they`re under pressure. They think time is on their side. And we need to keep that in mind if we`re thinking about solutions that, on the one hand, will address the root causes, but on the other hand put an end to the violence very soon.
RAY SUAREZ: Robert Malley, very quickly, can there be a regional solution, a cessation of conflict, without the destruction of Hezbollah as an armed force?
ROBERT MALLEY: If there is not, as I said, we`re going to be waiting for a very long time. I think we need to first let`s stop the violence and then let`s tackle the issue of Hezbollah`s future, its demilitarization, the future of Lebanon, and of course the future of the Arab-Israeli peace process, which has been abandoned for far too long.
RAY SUAREZ: Robert Malley, Ambassador Indyk, thank you, both.
ROBERT MALLEY: Thank you. (BREAK)
JIM LEHRER: Now, what the Middle East crisis is doing to the price of oil on the future markets this week. NewsHour economic correspondent Paul Solman has our report.
PAUL SOLMAN: Bedlam as usual at midtown Manhattan`s Man Financial, one of the world`s top commodity brokers.
FUTURES TRADER: Give me that. I`ll give him a shout. I`ll get him rolling.
PAUL SOLMAN: In the Middle East, Hezbollah versus Israel. Hanging on every headline, it seemed, the oil futures market, which, opened for electronic trading Sunday night at 6:00 p.m., would start trading on the exchange floor in less than an hour on Monday. We asked Andy Lebow for recent prices.
ANDREW LEBOW, Man Financial: Yager (ph), what was last night`s range?
FUTURES TRADER: It was from $77.74 to $75.60.
PAUL SOLMAN: That`s a $2 difference within minutes, a 3 percent plunge, about 300 points if this were the stock market.
And that was because the Israelis said what right over here at 6:00 in the morning?
ANDREW LEBOW: That they may very well wrap up the military offensive in a couple of days.
PAUL SOLMAN: And then that was denied?
ANDREW LEBOW: Came to here. It`s up here now. There`s a refinery on fire in Venezuela right now, so the market has rallied up further.
PAUL SOLMAN: And that chart only went up to 6:00 a.m. What`s the price right now?
ANDREW LEBOW: It`s about the same.
PAUL SOLMAN: The same, unless, of course, the Mideast crisis spreads and drives the price up above last Friday`s record $78 bucks a barrel. And that gets us to the key question of this story: What moves the oil market? Lebow`s answer: the usual suspects.
ANDREW LEBOW: It`s supply and demand, lack of spare production capacity, lack of spare refinery capacity, geopolitical fears.
PAUL SOLMAN: In short, a familiar story: the geopolitics of the Middle East; too few refineries; surging demand for oil in