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Chris Sanders: Let Them Eat Words

Sanders Research Associates Ltd. provides international strategic planning and risk management services to both corporate and private clients. SRA also publishes a webzine available by subscription. Visit http://www.sandersresearch.com to get a good feel for the real deal.

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SRA Commentary:

Let them eat words


By Chris Sanders
June 7, 2004

© 2003-5. Sanders Research Associates. All rights reserved.

The whole art of Conservative politics in the 20th century is being deployed to enable wealth to persuade poverty to use its political freedom to keep wealth in power.
- Aneurin Bevan, quoted in William Blum (1986) The CIA, a forgotten history, London, Zed Books, ISBN 0-86232-480-7, p.31

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Is it just a war for oil?

As any of the investors who attended SRA’s November 2001 conference Oil Wars can tell you, the War on Terror was always going to be the War for the Planet’s Oil. By and large, this idea attracts two reactions, both of them erroneous. One is that put forward by the war party itself, which is that the War on Terror is about promoting democracy, liberating enslaved people, overthrowing genocidal dictators, stopping money laundering, narcotics and arms trafficking terrorists, and even promoting women’s rights. This proposition is the easiest to dispose of. The country supposedly promoting democracy just suspended its Bill of Rights through its Patriot Act. It has announced that it respects no authority other than itself and accords no consideration to prisoners; while at home it has used the threat of suspension of habeas corpus and the full weight of anti-terror law to intervene in a major labour dispute on behalf of management.[i] As for genocide, it has abetted or been directly responsible for the deaths of thousands over the last hundred years. It is the biggest money laundering, narcotics trafficking and arms selling power in history, which restored Afghanistan’s opium and heroin export business in record time after overthrowing the government of that country. As for women’s rights, ask Afghani women what they think. Ladies and gentlemen, I give you the United States.

The second proposition is not so easy to dispose of, because it actually has some foundation in fact. It is that the War on Terror is about nothing other than oil and corporate profits. As one can see from the Unocal lobbyists running Afghanistan and the uncanny ability of Dick Cheney’s firm Halliburton to secure fat contracts, it most certainly is about both oil and corporate profits. But that is not the whole story by a long shot. If it were, the doubts of many in the oil industry about the wisdom of invading Iraq would have carried much more weight with an administration supposedly in the pocket of that industry. As for corporate profits, oil at $42 a barrel is pretty tasty, and no one can deny the windfall that American arms manufacturers and murder-for-hire firms are enjoying. But as the Anglo-American oil firms that were once the sole contenders for the richest energy project to come out of Saudi Arabia in decades can tell you, losing that contract to Russian, European and Chinese competitors cannot feel great. And Citibank just sold its remaining 20% of the Saudi American Bank, once the jewel of its global network, and fabulously profitable even in the age of terror. Oil and profits just don’t tell the whole story. Something else is going on.

Access to oil even in the new paradigm of peak oil never needed to be a casus belli. The US already had a major military presence in the Persian Gulf region predating Saddam’s invasion of Kuwait. It was the unchallenged arbiter of Gulf affairs once the Soviet Union collapsed, and the Soviet challenge we now know, with the benefit of hindsight, never had a snowball’s chance in hell of succeeding.


Click for big version

Source: www.lib.utexas.edu/ maps/kuwait.html

Oil producers need buyers as surely as the buyers need oil. Even governments with every reason to be hostile to the US still sell it oil; witness Saddam, who kept the taps open right up to the end, and Hugo Chavez, no dictator but himself existentially threatened by the US (undoubtedly because he is no dictator), nevertheless still keeps the gringos in cheap hydrocarbons.

For that matter, the energy outlook is not the hopeless mess that it is often said to be. There is much the US, with minimal effort could do to extend the useful life of the world’s oil reserves. As has been shown countless times, conservation is easily the most effective policy, and when one thinks about what the $200 billion spent on raining bombs and terror upon Afghanistan and Iraq could do if spent on energy saving infrastructure development and renewable energy research, one can't avoid the concluding that something is wrong or at least incomplete about the world energy picture.

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Bushonomics 101

Consider that with Iraqi exports in the neighbourhood of $2 million barrels a day, the cost of an Iraqi barrel of crude is somewhere north of $200 a barrel when you factor in the daily cost of the war to get control of it. And that is just the purely military costs. It says nothing about the price of rebuilding that country’s oil infrastructure, or the cost of years of no-fly-zone “enforcement.” It factors in none of the human costs and not just to the Iraqis. American servicemen are fed a diet of methamphetamines, “rummies” as the troops call them,[ii] in a combat environment in which the danger of long term health damage from depleted uranium ammunition is more dangerous than the Iraqis with AK47s and RPGs. It strikes us that even the owner of the Texas Rangers baseball team and the fabled loss-making Harken Energy could do the maths on this problem.

Of course, both of those loss-making ventures were profitable for him, which undoubtedly informs his point of view about the economics of Iraqi oil production and marketing. And as we can see from the record of his vice president’s wheeling and dealing in the various theatres of the War on Terror, his friends also know a few things about making money out of other people’s losses. Halliburton’s success, if that is the right word, has nothing to do with its ability to perform on a project. Indeed, like the fabled railway companies of the American frontier and the contemporary privatised British postal service, profitability may well be inversely correlated to project performance. The important thing is to insert a tap into the rich flow of cash and insider information that political office holders control. The occupant of the vice presidential bunker hundreds of feet below the Pennsylvania countryside is nothing if not a good tap.

Could it be that all there is to the War on Terror is just a cynical exercise of power and fraud? Well, actually, it could just be. It would not be the first time. Consider this, for example: one of the best kept secrets of World War Two was the fact that after the invasion of Poland, the British and the French governments continued planning to invade the Soviet Union for months, and the British (at least the Chamberlain government) actively attempted to persuade the Germans to do the same thing.[iii] The pathological anticommunism of the very wealthy in both countries has trumped their nationalism every time, wherein lies a very good lesson: could it be that it is actually parties of the left, that is to say bona fide parties of the people, that are really the ones that are nationalistic? The patriotic bombast of George Bush notwithstanding, it does not take great imagination to picture him happy anywhere that he did not have to work for a living and was kept in an ample supply of cocaine or its religious equivalent, Rapture Fever.

The collapse of the Soviet Union and the rapid accommodation of the Chinese to market economics removed communism as an excuse to tap the masses. It did not, mind you, remove the Pentagon, the biggest tap of all. By 1989 it was bereft of an excuse for twelve aircraft carrier battle groups, Seawolf subs ready for keel laying, death rays waiting to be built in Alaska, and hundreds of field and flag officers wondering where the military contractors that were supposed to be their retirement bonanza were going to be if they had to find a way to compete in a free market for their livelihood. Saddam Hussein marched into Kuwait as if on the wings of the National Security Complex retirement board, which perhaps explains US ambassador April Glaspie’s insouciance in the face of Saddam’s expressed desire to settle his border and oil dispute with Kuwait. It is no coincidence, I think, that in 1993 Samuel P. Huntingdon published in Foreign Affairs his article A Clash of Civilizations?[iv] that purported to show how new global conflicts would be, well, clashes of civilisations. This sounded good if not a little pompous, and was coming from a Harvard professor, former NSC officer and protégé of Zbigniew Brezhinski and, not incidentally, a visiting Fellow of All Souls at Oxford.


Samuel P. Huntingdon

With a background like this he ought to have known, since American intelligence had been busy facilitating that clash for at least twenty years if not longer. It was the US that made possible the long guerrilla war by the Mujahedin against the Russians, and if the Americans cannot be accused of creating radical Islam, they can certainly be accused of fostering it. Given that the US financed the Afghan war against the Russians, supported the Kosovo Liberation Army in its bid to wrest Kosovo from Serbia, helped both to finance their activities by trafficking in narcotics, and in the case of the KLA helped Iran to funnel arms and support, the US claim to be ridding the world of Islamic terrorism is farcical. The US is Islamic terror in many parts of the world.

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The Most Expensive Oil Money Can Buy

Islam as it happens is the world’s fastest growing religion, proving again the spiritual truth that it is in adversity that real life flourishes. As the industrial world rapes Africa, it is not to liberal capitalism that converts are flocking south of the Sahara; it is Islam. It is not an industrial world leader calling for the creation of an international reserve unit openly backed by gold and the force of law; it is a Muslim, Mahathir Muhammed. And it is not Iraqis in Abu Ghraib and Camp X-ray or Palestinians in Gaza and behind the wall on the West Bank that are demeaned and without dignity; it is their oppressors with the blow-dried hair mouthing cant about liberty, democracy and freedom while they deliver the opposite. Their contempt for the people they rule is such that they no longer even attempt to deliver on their empty words: words are enough, apparently. Let them eat words.

This is a high price indeed for oil we could have bought for $40 a barrel or less.

Chris Sanders
csanders@sandersresearch.com

FOOTNOTES:

[i] This was the dispute between the Pacific Maritime Association and the International Longshoremen Association, in which Tom Ridge, as head of the Office of Homeland Security, threatened the union, which had been locked out, with action on the grounds that union resistance constituted "economic terror".

[ii] So-called because Donald Rumsfeld is said to have ordered their use.

[iii] See Clement Liebovitz and Alvin Finkel (1997). The Chamberlain Hitler Collusion, New York, Monthly Review Press ISBN 0-85345-999-1

[iv] Samuel P. Huntingdon, A clash of civilisations? Foreign Affairs, Summer 1993. Huntingdon followed this with a book on the same subject whose title, The clash of civilizations and the remaking of world order dropped the question mark to emphasize, I suppose, that there was no longer anything to question about his world view. Certainly the enthusiasm with which his article was received in establishment circles indicates that from that direction at least, there were and are no questions. For some of his more recent views see http://www.nytimes.com/2004/05/02/magazine/02QUESTIONS.html?ex=1086667200&en=ae20f1e9072c27f6&ei=5070

****ENDS****

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