Why has the U.S. restored diplomatic ties with Libya? 

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On May 15, while the rest of us were busy celebrating Slovenian Armed Forces Day and the 65th birthday of nylon stockings, President Bush was busy dramatically altering U.S. foreign policy.

It was on that date that President Bush fully restored U.S. diplomatic relations with North African Arab dictatorship Libya, and instructed Condi to remove Libya's name from the U.S. list of nations that sponsor terrorism.

How does making nice with a brutal dictator square with Bush's outspoken commitment to spreading freedom and democracy?

It doesn't. In the words of C. David Welch, the State Department's assistant secretary for Near Eastern affairs, the policy shift is a "demonstration" showing that "when countries make a decision to adhere to international norms and behavior, they will reap concrete benefits."

Translation: "Hey, Iran and North Korea, Bush's mission of toppling dictatorships and installing democracies is officially over. If you wanna go from chump-to-champ and rogue-to-vogue, just start acting like Libya."

Even if, like me, you never believed this administration's hifalutin freedom-talk, it's still pretty mind-blowing to witness the United States encouraging other nations to behave more like Libya.

Back in the '80s, Libya was America's primary Arab foe. After Ayatollah Khomeini of Iran and J.R. Ewing, Libyan dictator Col. Moammar Gadhafi was the man Americans most loved to hate. President Reagan once called him the "mad dog of the Middle East."

Gadhafi is a quasi-socialist, stridently nationalist dictator. Since taking power in 1969, he has jailed political opponents, supported terrorism, nationalized Libya's oil industry and funneled cash and weapons to several brutal African leaders.

In 1979, the United States made Libya an inaugural member of our State Sponsors of Terrorism list. In 1980, we broke off diplomatic relations. In 1986, after Libyan agents bombed a disco in Berlin, killing two U.S. servicemen, Reagan sent 66 U.S. aircraft on a bombing raid to kill Gadhafi. They missed him but killed 100 other Libyans, including Gadhafi's adopted daughter.

Libya responded in 1988 by blowing up Pan Am flight 103 over Lockerbie, Scotland. Of the 270 people who died, 189 of them were Americans. Until 9/11, it was the deadliest terrorist attack on American civilians.

In 1992, the United Nations imposed sanctions on Libya to pressure it into handing over the two men thought responsible for the Lockerbie bombing. The sanctions crippled Libya's biggest earner, its oil industry. By the end of the 1990s, Libya's economy was a wreck and Gadhafi was politically isolated.

With an eye on saving himself and eventually passing on control of his country to one of his sons, Gadhafi decided to reverse course. Gadhafi decided that he wanted to be friends with us.

He started negotiating with the Clinton administration. In 1999, he handed over the Lockerbie bombing suspects for trial in the Netherlands (one was convicted, one acquitted). According to Martin Indyk, assistant secretary of state for Near East affairs at the time of the talks, Gadhafi also agreed then to cooperate with U.S. efforts to combat al-Qaeda. Gadhafi has never been a huge fan of militant Islam, nor it of him. Militant Muslims repeatedly tried to assassinate Gadhafi.

In August 2003, the United States persuaded Libya to pay $5 million to the families of each Lockerbie bombing victim. The following month, the U.N. lifted sanctions.

By December 2003, Libya agreed to hand over to the U.S. its entire WMD program. Libya's WMD program wasn't a threat to anyone, but turning it over to us was important because it revealed to the world the extent to which Pakistani nuclear engineer A.Q. Khan had become the Ron Popeil of nukes.

The Bush administration doesn't like to talk about it, but oil was a huge factor in our decision to make nice with Libya. Libya has the largest proven oil reserves in Africa. Libyan oil's chemical properties make it easy to refine, and because of the country's long Mediterranean coastline, it's easy to export. In a business fraught with violence and uncertainty, Libya is a sure thing.

Since sanctions were lifted, American, European and Asian oil companies have been rushing in. Establishing diplomatic relations and removing Libya from the terror list means $$$ for U.S. oil business.

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