TALABANI REPORTS ON SADR REPRESENTATIVE'S VISIT,

S E C R E T SECTION 01 OF 02 BAGHDAD 000266 SIPDIS SIPDIS E.O. 12958: DECL: 01/24/2017 TAGS: PGOV PREL IZ SY SUBJECT: TALABANI REPORTS ON SADR REPRESENTATIVE'S VISIT, DISCUSSES DE-BA'ATH, OTHER ISSUES Classified By: Ambassador Zalmay Khalilzad per 1.4 (b) and (d) ¶1. (S) SUMMARY: Iraqi President Jalal Talabani told the Ambassador in a meeting on January 24 that he had met with a Sadrist the day before who told him they were ready to accept indirect communication with the U.S. as well as U.S. troops in Sadr City. Talabani agreed to work on his own version of the de-Ba'athification law to present to the Council of Representatives. He and the Ambassador discussed what could be done to energize the political process in Iraq as well as how to deal with KRG President Massoud Barzani's seeming intractability on hydrocarbons legislation and other issues. They also discussed President Bush's State of the Union speech and a potential Ba'ath Party split. Water Minister Abdel Latif Rashid discussed with the Ambassador a water project in Sulaymaniyah and the inability of the GOI to spend money. END SUMMARY. -------------- Talabani Receives Sadr Envoy -------------- ¶2. (S) Talabani told the Ambassador he received a Sadr representative, Baha ad-Din al-Arraji, on January 23 who told Talabani the Sadrists are not fighting against the coalition and are ready to accept U.S. troops entering Sadr City to arrest anyone that violates the law. Talabani asked him if this was also Muqtada al-Sadr's policy, he replied that it was - the "Sayid" (which we take to mean Sadr) told him to see Talabani. He said more broadly the Sadrists are ready for indirect contact with the USG, and are prepared to replace all the Sadrist ministers. They would prefer technocrats who need not be Sadrists, and they will accept Thamir Ghadban for Minister of Oil. ¶3. (S) He told Talabani the Sadrists are ready to replace Maliki, but did not offer a replacement. Baha ad-Din also expressed interest in meeting with Talabani and Vice-President Hashimi to discuss how to avoid problems with the Sunnis. Talabani said he did not mention the captured Sadrist Abdel Hadi al-Darraji. The Ambassador suggested Talabani follow up with a call to Sadr. -------------- De-Ba'athification Law -------------- ¶4. (S) Talabani said the Syrians told him in Damascus they were very displeased with de-Ba'athification and wanted it changed to "de-Saddamification." The Ambassador told Talabani that Chalabi was headed in the wrong direction on the de-Ba'athification law - instead of narrowing its focus he is expanding it to include civil society and other areas. ¶5. (S) Talabani said he could draw from both the Iraqi Islamic Party (IIP) draft and the Chalabi draft of the de-Ba'athification law and send a compromise law to the CoR in the name of the Iraqi President. The Ambassador said Chalabi needed to do the right thing with the de-Ba'athification law and stressed to Talabani the importance of including a sunset clause that stipulates when de-Ba'athification Commission ends and the judiciary takes over. Talabani said the Shia may be able to accept this now that Saddam has been executed. -------------- Steps Toward Political Progress -------------- ¶6. (S) The Ambassador asked Talabani what steps they could take to make real political progress, saying that the political elite is not energized enough. Talabani agreed to the Ambassador's suggestion that he give a speech to the Council of Representatives to press them to resolve the hydrocarbons law, de-Ba'athification law, and other laws. ¶7. (S) Talabani suggested they meet with SCIRI and UIA leader Abdelaziz al-Hakim in preparation for a larger meeting with Maliki, Hashimi, and Vice-President Mahdi. Talabani thought the Ambassador's suggestion of holding a retreat for Iraqi leaders was good, but he suggested they first meet with Hakim. He said Da'wa was the primary obstacle to forming the moderate front and the relationship between the PM and Hashimi made things difficult. ¶8. (S) Talabani said he needs to have a frank discussion with the PM regarding his actions toward Hashimi and on improving his performance. He said the Presidency and the PM need better communication and should be meeting once a week. Talabani told the Ambassador he had not been briefed by Maliki or National Security Advisor Rubaie on the next phase BAGHDAD 00000266 002 OF 002 of the Baghdad Security Plan, though he said Rubaie had expressed interest in coming to brief. -------------- Hydrocarbons and Security -------------- ¶9. (S) The Ambassador told Talabani he had heard from Deputy Prime Minister Barham Salih that Kurdistan Regional Government (KRG) President Massoud Barzani and KRG Prime Minister Nechirvan Barzani are pushing for more regional control over revenue sharing and contracts in the hydrocarbons law and are concerned about the implementation of the security plan and the use of peshmerga forces. He told Talabani that Barzani needed to understand the U.S. and the Kurds have a close relationship, but Barzani can damage that relationship if he stands in the way of progress. Talabani said Barzani would not come to Baghdad to discuss it, but he would call him on his secure line and tell the Ambassador if it was necessary to go to Erbil to see Barzani. -------------- Finance -------------- ¶10. (S) Asked how to increase the capacity of the GOI to spend money, Rashid said the Minister of Finance refuses to release it. Rashid said he is nice but does not deliver. The Ambassador suggested they tell the Finance Minister it will be difficult to keep him in that position if he does not deliver. Talabani said he would speak to him. -------------- State of the Union -------------- ¶11. (S) Asked for his reaction to the January 23 State of the Union speech, Talabani hesitated and then responded with "I must be OK with it." Water Minister Latif al-Rashid was more forthcoming, saying President Bush's speech was good and covered important areas such as Baghdad Security, the Jaysh al-Mahdi militia, and Iraqi responsibilities. -------------- Ba'ath Party Split -------------- ¶12. (S) Talabani said "al-Duri" (NFI) is publishing three articles. One article attacks Syria for allegedly plotting with the U.S. to occupy Iraq. Talabani said this is part of his strategy to break apart the Ba'ath Party. He gave the Ambassador a document on the alleged Ba'ath party split. KHALILZAD