Well, the legislation Bush promised never materialized, and on Wednesday attempts to arrive at a compromise oil law collapsed.

What's particularly revealing is the cause of the breakdown. Last month, the provincial government in Kurdistan, defying the central government, passed its own oil law; last week, a Kurdish Web site announced that the provincial government had signed a production-sharing deal with Hunt Oil of Dallas, and that seems to have been the last straw.

Now here's the thing: Ray L. Hunt, the chief executive and president of Hunt Oil, is a close political ally of Bush. More than that, Hunt is a member of the President's Foreign Intelligence Advisory Board, a key oversight body.

Okay, that's comment one from Paul Krugman. I'd like to combine that with this quote from Executive Order issued July 17, 2007

(i) to have committed, or to pose a significant risk of committing, an act or acts of violence that have the purpose or effect of:

(A) threatening the peace or stability of Iraq or the Government of Iraq; or

(B) undermining efforts to promote economic reconstruction and political reform in Iraq or to provide humanitarian assistance to the Iraqi people;

(ii) to have materially assisted, sponsored, or provided financial, material, logistical, or technical support for, or goods or services in support of, such an act or acts of violence or any person whose property and interests in property are blocked pursuant to this order; or

(iii) to be owned or controlled by, or to have acted or purported to act for or on behalf of, directly or indirectly, any person whose property and interests in property are blocked pursuant to this order.

(b) The prohibitions in subsection (a) of this section include, but are not limited to, (i) the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any person whose property and interests in property are blocked pursuant to this order, and (ii) the receipt of any contribution or provision of funds, goods, or services from any such person.

Now by my interpretation of this, it seems that Hunt Oil's move to create a separate plan with the Kurdish provincial government clearly undermines the efforts to create a unified Iraqi government. That would appear to be in violation of the executive order. Of course since Ray Hunt is a good buddy of W, and part of his Advisory Board, there's no way in hell that's going to go anywhere.

What I can say with 100% certainty however is whether or not any law was broken, this is a HUGE conflict of interest for Hunt to be involved in both sides of this.

San Jose Mercury News - Bush ally's Kurdish oil deal proves the surge has failed

Once considered to be Iraq’s worst enemy, Iran has now created, financed and armed the Shiite Islamic movements within southern Iraq. Since the Iraqi Parliamentary elections of 2005, the Shiites have made considerable political gains and now have substantial influence over the country’s U.S.-created military, its police, and the central government in Baghdad. In addition, Iraq is developing economic ties with Iran that Galbraith believes could soon link the two countries’ strategic oil supplies.

That sounds about right. Iraq and Iran have historically been opposed, but a civil war between the Shiites and Sunnis gives a religious edge to this where the Iranians can support the Shiites at basically no cost to themselves. And if we oppose them, we're in opposition to the main group in that "unity government."

Heckuva job Georgie.

Ambassador claims shortly before invasion, Bush didn't know there were two sects of Islam