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A POLITICAL COUP | DEBT RELIEF

White House soft-pedals Baker's mission

WASHINGTON -- The Bush administration is trying to lower expectations for this week's initial attempt by former secretary of state James A. Baker III to persuade disaffected US allies to join in a top presidential priority, erasing Iraq's crushing foreign debt burden.

Yesterday's announcement of the capture by US troops of deposed Iraqi dictator Saddam Hussein was likely to make Baker's job somewhat less prickly. Two chief opponents of President Bush's decision to invade Iraq and remove Hussein, the leaders of France and Germany, were quick to praise the development.

Gerhard Schroeder, Germany's chancellor, sent Bush a letter of congratulation expressing "much happiness" over the arrest. President Jacques Chirac of France, where Baker's mission begins tomorrow, called it a major event that will contribute to democracy and stability "and allow the Iraqis to master their destiny."

Baker leaves today and after France will go to Russia, Britain, Italy, and Germany. His first stop is Paris, where the week of meetings begins with Chirac. The rest of Baker's itinerary was still being tweaked as late as the weekend, a senior administration official said.

A longtime Bush family friend, Baker is a veteran troubleshooter with extensive business and diplomatic relationships around the world. In accepting the unpaid, part-time post of Bush's personal envoy on Iraqi debt, Baker is taking on a difficult mission at a difficult time despite yesterday's Hussein capture.

The Pentagon announced publicly last week that companies from Russia, Germany, France, and other countries that opposed the Iraq war cannot bid on Iraq reconstruction projects financed by US grants of $18.6 billion. The move infuriated the left-out countries and even drew criticism from some of Bush's most loyal Republican allies at home.

Russia, Baghdad's biggest creditor at $8 billion, made clear after learning of the policy it had no intention of writing off debt. The European Union has said it plans to investigate the legality of the ban, and United Nations Secretary General Kofi Annan called it "not unifying."

In all, Iraq owes some $40 billion to the United States, France, Germany, Japan, Russia, and other countries among 19 nations that belong to the Paris Club, an umbrella organization that conducts debt negotiations. At least another $80 billion is owed to other Arab countries and nations outside the Paris Club.

The monumental task of restructuring such a large IOU, combined with the anger on the eve of Baker's trip, led the White House to dampen hopes for progress by week's end, when Baker is to return and brief the president.

The White House has offered little information about Baker's travel plans and given little assurance it would discuss his meetings in Washington throughout the week, suggesting that information instead must be obtained through the governments with which Baker is meeting.

With American troops dying almost daily from attacks in Iraq, criticism mounting of Bush's postwar strategy for the country, and the presidential election in less than a year, the administration is eager to help Iraq to its feet quickly.

The administration has refused to say how much of the debt Iraq owes the United States will be forgiven. 

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