Obama administration proposes unfreezing Libya assets

U.S. Secretary of State Hillary Clinton makes remarks about the protests in Egypt at the State Department on January 26, 2011 in Washington, D.C.

Tess Vigeland: Back in February, the United States froze more than $30 billion worth of assets belonging to Colonel Muammar Gaddafi and his government. Today, Secretary of State Hillary Clinton said the Obama administration wants to unfreeze some of those assets to, in her words, "Help the Libyan people."

But as forces loyal to Gaddafi continue to hammer Libyan rebels, opposition leaders say they need more than just humanitarian aid and basic supplies -- they need money for weapons and training. And that's something the U.S. and Europe don't seem willing to pay for.

From Washington, Marketplace's David Gura reports.


David Gura: When Libyan rebels face Gaddafi's forces, it's hardly a fair fight. They've asked the NATO-led coalition for $2 billion to $3 billion for food and medicine, and for more military assistance, including weapons.

Robert Danin: The Coalition has been adamant about not wanting to go down that path of trying to arm the rebels as a way to topple Gaddafi, nor are they willing to put their own troops in on the ground.

That's Robert Danin, a fellow at the Council on Foreign Relations. He says they're worried about how much they'd have to spend, and if it would even help the Libyan opposition.

Danin: Well, I think that there's concern, first of all, that it takes time to stand up an army, train them, get them in a position where they're actually able to be effective.

Experts say it wouldn't be easy for the U.S. to control how the money would be spent. And Democratic Congressman Dennis Kucinich says it's illegal to redistribute those frozen Libyan billions.

Dennis Kuchinich: It'll be dropped into that yawning pit of a war, which, you know, who knows where the money goes.

So far, the U.S. has pledged $53 million in humanitarian aid and $25 million in non-lethal military aid. Rebels aren't supposed to use that for weapons, but Kucinich says that's a joke.

Kucinich: Once you bring money in, money's fungible. And the money's going to inevitably end up arming individuals who have been members of groups which have fought the United States in the past.

But unfreezing Libyan assets could be a way to contribute help without turning to U.S. taxpayers.

In Washington, I'm David Gura for Marketplace.

About the author

David Gura is a reporter for Marketplace, based in the Washington, D.C. bureau.

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