January 6, 1999

                   More on Operation Desert Fox and the Apparent Coup Attempt

                   The conventional time line for Operation Desert Fox begins around
                   December 10, when UN inspectors were embroiled in their last
                   round of standoffs with Iraq over access to disputed sites in
                   Iraq, including Ba'ath party headquarters in Baghdad.  The next
                   point on the conventional time line occurred on December 16 when,
                   only hours after chief UN weapons inspector Richard Butler issued
                   a report stating that Iraq was continuing to be uncooperative,
                   the UN withdrew its inspectors from Iraq and U.S. cruise missiles
                   began striking Iraq.  Three other incidents prior to the launch
                   of Desert Fox caught our attention, however.

                   The first two events occurred on December 14.  A Saudi soldier
                   was shot and killed by an unidentified assailant in a vehicle
                   near an Iraqi border post near the Saudi town of Arar.
                   Speculation at the time was that smugglers may have been
                   responsible, which is an altogether possible explanation.  Also
                   on December 14, U.S. forces in the Persian Gulf region were put
                   on Defense Condition Charlie, ostensibly due to a heightened
                   threat of terrorist actions from militants linked to Osama Bin
                   Laden.  That, too, may have been the case, but we're not
                   convinced there wasn't more at work.

                   The most significant incident occurred just before the air
                   strikes on December 16, when Saddam Hussein announced a dramatic
                   restructuring and redeployment of the Iraqi armed forces.  This
                   may have been merely coincidental and somewhat bad timing, but it
                   certainly wasn't initiated by forewarning of the U.S. cruise
                   missile attack.  Our speculation, based on subsequent events, is
                   that Saddam's Presidential Decree Number 98, rearranging the
                   Iraqi armed forces, was prompted by Saddam uncovering a U.S.
                   sponsored coup plot.  Moreover, it is possible that the discovery