A War for Bananas? - Part VIII, ThugPolitik -- Full Spectrum Dominance

Following the election of President Clinton, Dick Cheney and his cohorts in the Reaganite bureaucratic infrastructure went to work preparing for the day of the eventual resumption of power. As previously reported (Fear and Loathing in the New American Century) the doctrine was given an initial airing in a “white paper” put out by the New American Century Org., a think tank rustled up {ie. founded} by conservative publisher William Kristol, (with defense industry money), for the specific purpose of promoting the Cheney/ Rumsfeld/ Wolfowitz doctrine of "full-spectrum dominance".

Stated simply the doctrine hold s that the US should control military, economic and political development worldwide by whatever means necessary and convenient, from cyber to nuclear war and all methods in between. In other words, “I’m the boss around here, and no that’s that.” In the words of the white paper, the United States "must maintain the mechanisms for deterring potential competitors from even aspiring to a larger regional or global role." In other words, the doctrine regards any “potential” rivalry as an “actual” threat and calls for the use a full spectrum military response as needed, from secret infiltrations, dirty wars, to nuclear blasts to keep other nations humble. It also calls for disinformation and the use of the internet as a weapon, presumably to keep everyone ignorant.

Published in September 2000, two years before Bush’s first State of the Union Address, it branded Iran, Iraq and North Korea as an “axis of evil.” Its authors recommended that the Pentagon take preemptive measures to prevent the proliferation of weapons of mass destruction in such countries as North Korea, Iraq, and some of the former Soviet republics. The document made no mention of collective action through the UN, stating that "we should expect future coalitions to be ad hoc assemblies, often not lasting beyond the crisis being confronted...."

But the paper was not even principally concerned with the Axis of Evil, hidden in the text of ThugPolitik was a concern for resurgent Russian and Chinese power. It described Russia and China as “potential” threats and warned that Germany, Japan, and other industrial powers might be tempted to rearm and acquire nuclear weapons if their security was threatened, and this might start them on the way to competition with the United States.

In September 2002, the Kristol “white paper” was put on White House paper and became official U.S. Policy under the title “The National Security Strategy of the United States of America”. Although the paper added some rhetorical embellishments about promoting democracy and finding the fountain of youth, its principle premise and objective was simply to maintain the United States in a position of sole global power.

Uri Avneri and Israeli leftists in the peace movement complain that the U.S. is using Israel for its own geo-political purposes. Neo-nazi right wingers in the U.S. and elsewhere complain that the new Youngers of Zion are using the U.S. to advance Jewish aims. Whatever the case, there is an undeniable parallelism between Israeli/ Likud policy in the smaller universe of the Middle East and the US/Bush policy in the greater universe of the world. As Israel must be the sole power in the Middle East, so the U.S. must be the sole global super-power, including the Middle East. The authors of America’s New Century would not deny the parallelism, they would only dispute that it presents any problem. To them, What’s good for Israel is good for the U.S. and vice versa. In a curious way, they speak the same talk as Saddam Hussein or the most fervently anti- Zionist Arab.

This was hardly Bush senior's view of America's role in the world.

Qui Bono?

Is the looming war a “war for oil” as the placards say? The existence of oil fields in the area, the deals that have been made with respect them thus far, the undeniable importance of oil in the modern world and the evident interests various parties have in gaining access and or control to it -- all these factors render it absurd to answer anything but “yes”. But there is little evidence so far that American oil companies (Big Oil) are pushing the Administration to seize Iraqi oil production facilities, in the way they once were pushing Franklin Delano Roosevelt to invade Mexico in order to seize-back nationalised oil.

On the other hand there is ample evidence that circles within the U.S. political establishment have elaborated Israeli security interests (as perceived by the Likudists) into a more General Theory of Hegemony, that resonates with American jingoists while providing an ideological “security umbrella” to Israel.

But while that may well be the case, it also has to be said that it takes many tugboats to push a big liner. Rarely is policy in the mass imperial state the result of any one qui or any one bono. It is usually the result of a confluence of forces, in which various players succeed in cajoling and co-opting one another. More important that asking which singular who is benefited is understanding who the who’s are, what interests and weaknesses they have and how they stand to use or be used.

©WCG, 2003
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A War for Bananas? - Part VII, Oil and Water - The Israeli Factor

No story on the Middle East can be complete without taking Israel into account. While peace groups in Israel favor compromise and coexistence with moderates in the Arab world willing to do the same, Israeli government policy for the past 20 years has been dominated by the irredentist Likud, the successor to so called Revisionist Zionism with its frankly racialist and colonialist ideas. Given this premise, Israeli security is based on a stark equation: Israel must be strong and the surrounding countries must be kept weak.

When one recalls the to-Heaven shrieking furore that surrounded the American sale of AWACS to Saudi Arabia in the 1970’s it is easy to see how Iraq would be the bete noire in Israeli strategizing. Keeping Iraq weak is not simply a matter of reducing its army or constraining its armaments. More fundamentally it is a question of depriving it of its major geo-political asset. A petro-servient Iraq is not a threat to anyone.

One does not need to be a rocket scientist to understand Israeli interests in the situation. According to the Asia Times, an active promoter of Israeli interests is a so-called "former" Israeli intelligence agent, Yousef Maiman, president of the Mehrav Group Maiman is a "Special Ambassador", to Turkenistan as well as a citizen [!] of the same gas republic by presidential decree. According to the Times, nobody knows where Mehrav's money comes from; but the Times quotes the Wall Street Journal, as reporting that it is actively involved in advancing the "geopolitical goals of both the US and Israel" in Central Asia.

What are those goals? Maiman is quoted as saying: "Controlling the transport route is controlling the product." That certainly dovetails with statements by the EIA. The Mehrav Group itself has accordingly joined in promoting the Baku-Ceyhan oil pipeline, which provides the further advantage of being easily extended to bring oil directly to “thirsty” Israel. Magal Security Systems, an Israeli company, is also set to provide the security for the 2,000 km long Baku-Ceyhan oil pipeline Picking up a story disclosed by Israel peace groups, the Times also reports that Mehrav is involved in a “murderous project” to reduce the flow of water to Iraq by diverting water from the Tigris and the Euphrates rivers to southeastern Turkey.

In an article in the New York Review of Books, Frances FitzGerald (9/02) argued that Israel and its lobbyists in the United States want the destruction of Iraq on pure geo-political grounds independent of oil issues. He points out that “years before the Bush administration took office Rumsfeld and [Deputy Defense Secretary Paul] Wolfowitz were calling for [Hussein’s] overthrow on the grounds that he posed a danger to the region, and in particular to Israel”

In January 1998 they, along with the neo-conservative William Kristol and others associated with Kristol's Project for a New Century, wrote President Clinton that if Saddam acquired the means to deliver weapons of mass destruction, he would pose a threat to American troops in the region, to Israel, to the moderate Arab states, and to the supply of oil. Four months later they went to capitol hill to beat this drum before congress.

In June 1999 Wolfowitz complained that “the containment of Iraq is failing. The United States needs to accelerate Saddam's demise if it truly wants to help the peace process." Wolfowitz was implying that with Saddam Hussein eliminated, Israel could choose the peace it wanted with the Palestinians. The cabal kept it up past the elections. Since September 11, William Kristol and associates have been urging Bush to see Israel's fight against terrorism as America's battle to make war on Saddam Hussein, as both Sharon and Peres have urged.

On April 15 2002 Kristol and Robert Kagan wrote that Bush should not play any role as Middle East peace negotiator. "The road that leads to real security and peace—the road runs through Baghdad." One week later, a senior Israeli official confirmed that “Pentagon officials” [i.e Rumsfeld and Wolfowitz] were pushing the White House to bring down Hussein before anything else. With Hussein out of the picture, they argued, Israel could solve the Palestinian problem on its own terms.

As documented in an article in Counterpunch e-zine, Wolfowitz, Douglas Feith, John Bolton have strong affiliations with the Likud. Feith and Richard Perle collaborated in authoring a 1996 study for then Prime Minister Benjamin Netanyahu in which Hussein’s overthrow (aka “regime change”) was described as “an important Israel strategic objective in it own right -- [and] as a means of foiling Syria’s regional ambitions.” The study urged a preemptive strike. (See. A Clean Break: A New Strategy for Securing the Realm (http:// www. israeleconomy. org/strat1.htm).)

Nothing has changed since. In August 2002, Israeli Deputy Interior Minister Gideon Ezra told the Christian Science Monitor that a U.S. attack on Iraq would help Israel impose a new order without Arafat. “The more aggressive the attack is, the more it will help Israel against the Palestinians.” he said.

According to Independent columnist Robert Fisk, Jewish American leaders talk about the advantages of an Iraqi war with enthusiasm, although Bush and Blair keep this aspect of the issue carefully under wraps. According to Fisk, Rumsfeld’s allusions to the “old” Europe were a thinly veiled reference to French antisemitism and collaboration with the Nazis.

Whether they were or not, it was hardly surprising that in a Wall Street Journal article, following Powell’s UN speech, Professor Eliot Cohen, of Johns Hopkins University, suggested that European nations' objections to the war might – yet again – be ascribed to "anti-semitism of a type long thought dead in the West, a loathing that ascribes to Jews a malignant intent.” What kind of intent is it that would seek to divert Iraq’s water to the Levant? “The France and Germany that oppose this war,” Fisk says, “are the "new" Europe, the continent which refuses, ever again, to slaughter the innocent.”

©WCG, 2003
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A War for Bananas? - Part VI, When First You Fail, Try.... What?

The question raised by the foregoing denouement is whether the crisis in Iraq is simply an oil-grab. The evidence points to an affirmative answer; but it is by no means a question of “simply” since private prospects -- to the extent they are actually urged by the oil companies -- must be pieced into and justified by an over-arching national strategy and it is not entirely clear that a national strategyhas been coherently resolved upon.

At the end of 2002, leading oilmen, exiled Iraqis and lawyers met behind the closed doors of the Royal Institute of International Affairs, in London. The meeting was entitled "Invading Iraq: dangers and opportunities for the energy sector".

According to the Guardian which ran the story, “One delegate said the entire day could be summarized with: "Who gets the oil?" If America changes the regime you might expect US companies to get it.” But, as the Guardian noted, “it maybe more complicated than that.”

The Iraqi oil industry was built up by Iraq Petroleum Co. (IPC) a consortium owned by BP, Exxon/Standard Oil, Mobil, Shell, and Partex. In 1972, IPC was nationalized by the revolutionary Iraqi regime. Negotiations over nationalization were fierce. Negotiators for IPC team had some extraordinary clashes with Saddam Hussein and Iraq's vice-president, wh0 threatened “any battle with the companies that was necessary" The Iraqis also threatened IPC with loss of Saudi Arabian and Kuwaiti oil due to Arab solidarity. In February 1973, the IPC finally signed the nationalization agreement. IPC was compensated for its lost oil-fields, and by 1975 operations were taken over by the Iraq National Oil Co and the Northern Petroleum Organization.

Normally, IPC’s compensation would be deemed to terminate its rights. It is also a rule of international law that valid contracts survive regime changes. "The majority opinion is that if a government creates a [legal] title, it survives a change of government," Prof. Thomas Wäld told the Guardian. Doak Bishop, vice-chair of the Institute of Trans-national Arbitration agreed: "Regime change does not change the acquired rights companies have in the area. If the Russians and the French have legal rights in those fields, then a regime change would not oust them of those rights, but it could well get pretty messy."

The Americans, apparently, are of another view. Former CIA director James Woolsey, who is close to the Iraqi opposition groups, recently told the Washington Post: "It's pretty straightforward. France and Russia have oil companies and interests in Iraq. They should be told that if they are of assistance in moving Iraq towards decent government, we'll do the best we can to ensure the new government and American companies work closely with them. If they throw in their lot with Saddam, it will be difficult, to the point of impossible, to persuade the new Iraqi government to work with them."

In light of such belligerence, French complaints about “unilateralism” acquire a new accent.

No one, not even an upstanding oil company, could be expected to toss away manna from heaven (or from the bowels of the planet, as the case may be.) But it seems to be a characteristic of corporate culture that companies are as cautious as they are avaricious. American oil companies certainly understand that a destructive war would make it more expensive to rebuild Iraq’s oil facilities. They also understand that an unstable peace would make it more problematic to pump and transport it. Lastly, oil companies are not adverse to dealing with whatever regime it happens to be easiest to deal with be it Maoist Chinese, Fascist Chileans, Fundamentalist Muslims or Saddam Hussein. That unspecified “oilmen” might have met in London to discuss hypotheticals does not prove that oil companies are pushing the present policy.

Part of the difficulty in figuring out qui bono, is figuring out how to contextualize President Bush’s thuggish pronouncements. The one group to whom Bush’s public tantrums (“I’ve had it” “The Game is Up” “Saddam is finished” etc.) will not sound shocking is that class of American lawyer that deals in what is known as “settlement negotiations”. The claims of super-human patience, the feigned exasperation, the two-hour ultimatum coupled with an angry threat -- these are all the sorts of antics that go on behind the highly polished brass on front doors of “blue chip” law firms. The half of the conversation which the public hears sounds like some kind of “settlement negotiation” is taking place.... But with whom? The difficulty in assessing Bush’s ridiculous antics is that one does not know what offers and counter-offers have been made and rejected. It is a near certainty that the conversation we hear has nothing to do with weapons inspections which is little more than a noisy side-show, employing many, urged with earnestness and signifying nothing. That leaves us in the unenviable Thomist position of “knowing God by saying what he is not.”

While the anecdotal and symptomatic evidence points to the conclusion that the Bush Administration is resolved on war for the sake of oil, that same evidence also points to the bizarre fact that the Administration is at something of a loss as to what to do with the oil once it gets it. Complicating matters is the curious backward way the Administration as well as the Press speak about things.

In mid December 2002, about the same time oilmen and lawyers were meeting behind the closed doors of the Royal Institute, the U.S. State Department issued a communique stating that, the first session of the “Future of Iraq project working group on Oil and Energy” would convene on December 20-21, 2002 in Washington, DC. At this session, the State Department’s Bureau of Near Eastern Affairs would be hosting approximately 15 “Free Iraqis” for discussions regarding the current state of Iraq’s oil and energy sectors, scenarios for the restoration and modernization of Iraq's oil fields and other essential energy infrastructure; and management of the energy sector to meet the needs of the Iraqi people in the post-Saddam era. The meeting would be closed to the press.

A month later, at the beginning of January, the Houston Chronicle circulated a New York Times article on the Administration’s plans for the occupation of Iraq which, it said, “would amount to the most ambitious American effort to administer a country since the occupations of Japan and Germany at the end of World War II.” Although many elements of the plans were classified or still being debated, the occupation had two objectives: "preserve Iraq as a unitary state, with its territorial integrity intact," and "prevent unhelpful outside interference, military or nonmilitary.”

Buried in the middle of the long report, dealing with a pot-pourri of military and social issues, the article noted: "There is no more delicate question for the administration than how to deal with Iraq's oil reserves ... and how to raise money from oil sales for rebuilding without prompting charges that control of oil, not disarming Iraq, is Bush's true aim.”

One would think that the primary “story” was whether one should make war for oil not how the administration has to deal with a “delicate” appearance Nevertheless, in this oblique and almost buried way, the article went on to disclose that “Administration officials have been careful always to talk about Iraqi oil as the property of the Iraqi people.” At the same time, the White House was haunted by the nightmare that Saddam Hussein might deprive them of the desired prize, by destroying the fields. Administration officials were quoted as saying, “It's a big source of concern, and we are trying to take account of it as we plan how to use our military forces.”

Indeed. Speaking on 29 December, Secretary of State Collin L. Powell stated, "If coalition forces go into those oil fields, we would want to protect those fields and make sure that they are used to benefit the people of Iraq, and are not destroyed or damaged by a failing regime on the way out the door."

Once again, as almost every day, one has to pause to make sense out of the Administration’s extremely bizarre way of speaking. “If coalition [i.e. predominantly American] forces go into the oil fields” would they want to blow them up? Hardly. But if one “would want to protect those fields” going into them would not be a matter of possibly happening to be there (“if”). Why does Powell speak as if American forces might stumble into custody of oil fields and then have to do their fair and honest best to be good custodians? He speaks that way in order to avoid speaking truthfully, that the “true aim” of the Administration is to make a bee-line to those oil fields and seize possession of them. Hussein, apparently understood it that way, because in January the Iraqi government stated publicly it had plans to blow the fields up. Of course it was “a big source of concern.”

Once it is seen that the administration (and its echoes in the press) speak backwards, it is understood that seizing the oil fields is not the result of happening to have occupied Iraq, which is the result of going to war; rather, seizing the oil fields is the reason for occupying Iraq which is why the U.S. would go to war. Nevertheless, still talking as if control of oil is one of those collateral “effects” of war which would have to be managed somehow, as best one could, the Houston Chronicle/New York Times article continued “it is unclear how the administration plans to finesse the question of Iraq's role in the OPEC countries and who would represent occupied Iraq at the organization's meetings. [¶] The administration is already anticipating that neighboring Arab nations may accuse occupied Iraq of pumping oil beyond OPEC quotas. One official said Washington "fully expects" that the United States will be suspected of undermining the oil organization, and it is working on strategies, which he would not describe, to allay those fears.

One reason the official might not have described these strategies is that the administration is again deadlocked by a split that has plagued it since it took office. According to a 22 December 2002 story by the Los Angeles Times,the administration’s hawks want the United States to militarily seize, possess and control the oil fields whereas its doves “believe that it should be up to the Iraqis to decide how to rebuild their battered industry -- and which foreign oil companies will get to take part.”

It will hardly come as a surprise that the “hawks” are led by Deputy Secretary of Defense, Paul Wolfowitz, along with Richard Perle, among the chief protagonists of unilateral pro-consularity of American foreign policy. A report prepared by the Center for Strategic and Budgetary Assessments, in December 2002, and delivered to Wolfowitz’s office, concluded that “the cost of the occupation, the cost for the military administration and providing for a provisional [civilian] administration, all of that would come out of Iraqi oil.” Another source told the press that a number of officials in Cheney’s officer were also urging that Iraq's oil funds be used to defray the cost of occupation. Yet another unnamed source stated that many senior administration officials were of the view that "It [the oil] is going to fund the U.S. military presence there. .... They will charge the Iraqis for the U.S. cost of operating in Iraq. I don't think they're planning as far as I know to use Iraqi oil to pay for the invasion, but they are going to use it to pay for the occupation."

Nor will it surprise that the doves are headed by Collin Powell who reflects the views of the Council on Foreign Relations and Rice University's Baker Institute which, the Los Angeles Times states, “is believed to represent the thinking of many U.S. officials.” One of said “officials” is Baker Institute energy analyst Amy Myers Jaffe, who told the Times that "A lot of us have confidence in people who were professionals in the Iraqi oil industry and left the country, and in people who are still there." In other words, these so-called “U.S. officials” are really the oil-company folks who want to be left alone to their own free-market devices dealing with “capable” neo-liberal Iraqi “counterparts”.

Also arrayed against the hawks are bureaucrats in the National Security Council, Justice Department and Federal Reserve banking system. Mike Anton, a National Security Council spokesman denied the existence of any plan to use oil funds to pay for occupation stating that the oil revenues would be used “not so much to fund the operation and maintaining American forces but for humanitarian aid, refugees, possibly for infrastructure rebuilding, that kind of thing.”

Justice Department lawyers are unsure whether any of the oil funds could legally be used to defray occupation costs or whether, on the contrary, they had to be held in trust for the people of Iraq. Laurence Meyer, a former Federal Reserve Board governor, who chaired a Center for Strategic and International Studies conference in November on the economic consequences of a war with Iraq, said that conference participants deliberately avoided the question of whether Iraq should help pay occupation or other costs. "It's a very politically sensitive issue," he said. Meyer did say however, that those officials who believed Iraq's oil could defer some of the occupation costs may be "too optimistic about how much you could increase [oil production] and how long it would take to reinvest in the infrastructure and reinvest in additional oil."

Indeed, a CFR-Baker report estimated that even if Iraq emerged from war with no additional damage to its oil infrastructure, its annual oil revenues probably wouldn't exceed $12 billion a year whereas the Congressional Budget Office estimates that the cost of an occupation would range from $12 billion to $48 billion a year, lasting for one and half years or more. In other words while the bureaucratic infighting continues, Bush continues to speak publicly of administering Iraqi oil “in trust” for the Iraqi people.

It is astonishing to think that at this late date the increasingly belligerent pronouncements of the administration doves might in fact mask a continuing split over what to do with the oil once it is seized -- in other words, what the objective of an invasion is in the first place. And yet it the public symptoms bespeak an internal confusion. It will be remembered that, last Summer and Fall, along with Jim Baker and other former Bush I advisors, Brent Scowfcroft took the unusual step of publicly criticizing Bush Jr.’s reckless unilateralism. In August 2002, Scowcroft weighed in against the war whoops of the Rumsfeld-Kristol- Wolfowitz-Perle crowd arguing that a unilateralist attack would “turn the whole region into a cauldron” and that, with nothing left to lose, Saddam might unleash his weapons of mass destruction and attack Israel. Since this latter option was somewhat far fetched, Scowcroft might have meant to say that Saddam that a unilateral attack might result in Hussein blowing up his own fields. Whatever the case, Scowcroft was adamant that the Administration’s policy should be built on a multilateral focus on terrorism ...not a unilateral war with Iraq

The Administration heeded at least half the advice and, as a result, it administration deviated back to the Security Council chamber where it labored to achieve Resolution 1441. In a joint interview this Friday (2/14), with former Secretary of State Madeleine Albright, on Public Television, Scowcroft was asked whether, in view of the unprecedented applause which greeted the French Foreign Minister’s remarks to the Council, he was “receiving any heat from within the administration”. What was interesting was not Scowcroft reply (he refused any)but rather the little squeak-like “Ha!” that involuntarily emitted from Albright.

©WCG, 2003
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A War for Bananas? - Part V, Politics on the Stump and the Politics of the Pump

Like the sun and the moon, the politics and the economics of the Iraq situation stand in an inverse but reflective relation. The geo-political face of the conflict is simple and fairly constant. Saddam Hussein is a brutal, belligerent dictator who must be got rid of or at least disarmed and “neutralized”. The geo-economic face of the conflict is complex and extremely fluid. The general premise here is that Saddam can be negotiated with and that the stability he affords is better than the chaos. The political face is characterized by periodic and much publicized “crises” followed by long intervals of quiescence in what is supposedly a steady effort to get rid of Saddam. The economic face is ever silent covering steady attempts to trade with Saddam while surfacing from time to time in order to deny doing any such thing. An example of these dual constellations is that, in 1996, while director of Central Intelligence, John M. Deutch headed up American efforts to overthrow Iraqi President Saddam Hussein; but as of February 2000, Deutch sat on the board of Schlumberger Ltd., a multinational “shell” for US companies that was helping Baghdad service its oil rigs.

A brief and somewhat superficial summary of the past six years will give an idea of the curious dynamics surrounding Iraqi oil.

In 1996, the United Nations initiated the so-called oil-for-food program, which allowed limited and monitored sales of Iraqi oil in exchange for non-military and non dual-use goods. As of 1997, the Security Council removed any ceiling on the amount of oil Iraq could sell. However, it maintained a limit on the amount of spare parts Iraq could buy. As of June 1998 Iraq was allowed to buy only $300 million in spare parts every six months.

Complicating the situation, the United State government imposed sanctions on Iraq, which meant, in effect, that it prohibited American companies from doing business with the outlaw regime. But whereas Iraq could sell oil to anyone, it could only get the spare parts in needed from American sources which had built the original infrastructure. And if it could not get spare parts, it’s ability to pump and sell would be reduced. And so it stood; at least officially. According to U.S. government figures, American firms accounted for only a tiny share (about $400 million) of the nearly $10 billion in trade that has been conducted under the oil-for-food exemption. In reality, diplomats, industry officials and UN documents indicate that, between the summer of 1998 and Spring of 2000, American companies, operating through subsidiaries and affiliates, were buying oil and selling parts furiously, although they denied it in order to “comply” with the law.

One such company was Halliburton, the Dallas-based maker of oil equipment of which Dick Cheney was chairman and CEO until his election as vice-president. While the United States and Britain waged almost daily air strikes against military installations in northern and southern Iraq, Halliburton and other U.S. companies, were doing business with Saddam Hussein's government and helping to rebuild Iraq’s battered oil industry. Two such other companies were Dresser-Rand and Ingersoll-Dresser Pump Co., in which Cheney had major stock interests.

Prior to his election Dick Cheney was a long time critic of United States’ sanctions against Iraq which, he said, “penalized” American companies. They did not, however, greatly penalize Halliburton & Co. Although Cheney denied that Halliburton had business dealings “with” Baghdad, UN records showed that Halliburton held stakes in two “affiliates” that signed contracts to sell more than $73 million in oil production equipment and spare parts to Iraq.

Much the same obtains on the oil-buying side of the equation. In a speech to San Francisco’s Commonwealth Club, in November 1998 ,Chairman of the Board and Chief Executive Officer of Chevron Corporation , Kenneth T. Derr, criticized US imposed unilateral sanctions against various countries. Derr went on at length belaboring the obvious fact that (unless there is only one source) unilateral sanctions “don’t work”. On the other hand, Derr said “It might surprise you to learn that even though Iraq possesses huge reserves of oil and gas -- reserves I'd love Chevron to have access to -- I fully agree with the sanctions we have imposed on Iraq. Why? Because .Iraq’s conduct has been so egregious that ... other countries have been willing to join the United States by adding sanctions of their own.” What he did not say was that at the very time, without “access to” the reserves themselves Chevron was purchasing oil from the reserves” via middlemen.

A month later, the United States initiated Operation Desert Fox and bombed Iraq. Baghdad retaliated by prohibiting U.S. oil companies from directly purchasing Iraqi crude. " Any company found supplying Iraqi crude to a country in a state of war with Iraq will be put on the blacklist and there will be a partial or full ban in dealing with it," said Iraqi Trade Minister Mohammed Mehdi Saleh.

Yet despite multi-lateral sanctions imposed against Iraq and despite unilateral sanctions imposed by Iraq, Chevron and Exxon managed to increase their purchases of Iraqi crude in 1999. According to Larry Goldstein, president of the Petroleum Industry Research Foundation, Iraqi crude was the fastest growing source of imported crude amount to about 700,000 of the 2 million barrels of oil exported daily by Iraq or nine per cent of total U.S. oil imports. "The Chevrons and the Exxons of this world have to buy from the Russians, the French and the Chinese traders," said Goldstein. But, he added, "the U.S. spare parts industry is too dominant to ignore."

“Where does Iraq think its oil is going to go if it doesn't go to the U.S.?” asked one trader with a U.S. major oil company. Saudi Arabia, vowed to fill any disruption from Iraq, Iraq’s sanctions failed and Baghdad's penetration of the U.S. oil market soon surpassed pre-Gulf War levels.

In September 1999, more than 50 foreign companies attended an oil and natural gas technology exhibition in Baghdad, the first such gathering in 10 years. Most of the firms were from Canada, France, Italy, and the United Kingdom. No U.S. firms attended, although a high-level Iraqi oil official stated that Iraq was ready to deal with U.S. oil companies.

How Iraq was prepared to deal with foreign companies was another matter. A U.N. “Expert Report,” issued in March 2000, obliquely indicated that someone had floated the idea of foreign companies entering into “production sharing agreements” and/or “participating” in Iraq’s oil production. The Report states that the expert group “was advised, at Ministerial level, that in the current political environment...there would be no discussion on the matter of options for involving foreign oil companies in Iraq’s oil sector.”

The Report went on: “To sustain and increase oil production and export capacity it is the view of the experts that involvement of foreign companies would be helpful and, in principle, the Ministry of Oil welcomes this. .... However,... the Ministry of Oil declined to take part in discussions on this matter and was only willing to discuss the involvement of foreign companies through the use of short-term technical service contracts (“TSC’s”), such as well logging, pipeline pigging, and the drilling and work over of wells.” It would appear, however, that by the end of the following year the Ministry had modified its position at least to a point satisfactory to the companies, although getting there was a tad bumpy.

In October 2000, the Iraqi Oil Ministry expressed frustration with the slow pace of progress by Russian and Chinese firms; and, in January 2001, Shell announced that it had held talks with the Iraqi Oil Ministry regarding "potential opportunities". In March 2001, the Deputy Oil Minister announced that Iraq might terminate contracts with the Chinese and Russian companies. In July 2001, angered by France's perceived support for the U.S. "smart sanctions" plan, Iraq announced that it would no longer give French companies priority in awarding oil contracts, and would reconsider existing contracts as well. Iraq also announced that it was inclined to favor Russia, which has been supporting Iraq at the U.N. Security Council.

In October 2001 a joint Russian-Belarus oil company signed a service contract and Lukoil was granted its concession to spend $4 billion to develop a "super" oil field in southern Iraq In December 2001, the Turkish Petroleum International Corporation won a U.N.-approved contract to drill for oil in northern Iraq. It would appear that Iraq and France also resolved their difference as a recent (Fall 2002) report by the Royal Institute of International Affairs states that France Russia and China all have “potentially massive oil pacts” with Iraq and that “Saddam [Hussein] is believed to have offered the French company Total Elf Fina exclusive rights to the largest of Iraq's oil fields.”

In short, twists, turns, bumps and bombs, by the end of 2001 Iraq appeared poised to solve its oil problems and U.S. companies were not part of the solution. As of March 2000, the U.N. Expert Report had concluded in the direst of terms that Iraq was wasting its assets in order to sell them. “Although the effort of the Iraq oil industry has been enormous, and is notable for its effort to reinstate production after severe damage in a very short time, the lack of means to keep this industry in good shape in terms of capital, equipment and material, and also from the point of view of human resources, is very apparent. .... The oil industry is degrading, safety is below conventionally accepted standards, the environment is endangered, and the ultimate recovery potential of oil and gas in the fields is jeopardized. The current situation, if left unchanged, will lead inexorably to the demise of the oil industry.” In short, Iraq was engaged in the petro-equivalent of slash and burn agriculture.

But by the end of the following year the issues were resolved. Although nothing prevented U.S. companies from continuing to be passive end-buyers of crude, they were not in on the big deals. Moreover, it would appear that U.S. companies also stood to loose on the spare parts business because new infrastructure developed by France, Russia or China would not typically use American machinery.

Little is known of the negotiations in Baghdad, but it much of the blame for the last place showing by American companies can be laid at Washington’s door. As Cheney complained throughout the Nineties, U.S. regulations had hobbled American companies. These policies did not prevent end-runs, but neither did put wind in anyone’s sails. Diplomats interviewed for the Washington Post in February 2000 said Washington had been a greater obstacle for American businesses than Baghdad. The United States had placed "holds" on more than 1,000 contracts valued at $1.5 billion under the oil-for-food program, including some held by American companies. The March 2000 Expert Report Appendix likewise showed that over and over again repairs and construction were blocked by US objections that a screw or an adhesive had “dual use” capacity.

© WCG, 2003
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A War for Bananas? - Part IV, Iraq

The Pools

With proven reserves of 112-billion bbl and probable reserves of 214-billion bbl, Iraq has the second largest crude reserves in the world after Saudi Arabia. It also has 110 trillion cubic feet of natural gas.

Two-thirds of Iraq's production comes out of southern fields in the Shi’ite zone of the country. Although much of the southern oil infrastructure was damaged during the Gulf war, the oil potential of this region alone is huge. More huge, still, is the untapped Western Desert region under which lie an estimated additional 100 billion barrels.

The Pipes

The presently proven reserves are serviced by four pipeline networks:

1. Iraq-Turkey. The 600-mile, 40-inch Kirkuk-Ceyhan pipeline is Iraq's largest operable crude export pipeline. It services the European market. This Iraq-Turkey link has a fully-operational capacity of 1.1 million bbl/d, but is working at about 900,000 bbl/d. A second, parallel, 46-inch line has an optimal capacity of 500,000 bbl/d but at last report was inoperable.

2. Iraq-Syria. The 50-year-old, rusting Banias oil pipeline from Iraq's northern Kirkuk oil fields to Syria's Mediterranean port of Banias (and to Tripoli in Lebanon) was considered defunct; but, as of October 2002, the pipeline reportedly was being used (see above), and there also was talk of building a new, parallel pipeline as a replacement.

3. Persian Gulf Outlet. Iraq has three tanker terminals in the Persian Gulf. These terminals are linked to a reversible, 1.4-million bbl/d North-South pipeline built by Iraq in 1975. The system allows for export north through Turkey or south to the Persian Gulf. However, the entire system was severely damaged during the Iran-Iraq and Gulf wars.

4. Iraq-Saudi Arabia. Iraq has also pumped oil through Saudi Arabia to the Red Sea port of Yanbu (Mu'jiz) . However, in June 2001, Saudi Arabia announced that it had confiscated the line included pumping stations, storage tanks, and the maritime terminal. Iraq insisted that it still owned the pipeline, and in May 2002, stated that the line was "ready for export." (In addition to these transportation networks, Iraq trucks oil to Jordan, but this arrangement is of local benefit only.)
Production Problems

Iraq’s entire oil infrastructure was seriously degraded during the Iran-Iraq and Gulf wars and Iraq has resorted to old technology and questionable techniques (i.e., over pumping, water-injection or "flooding") to maintain production even though the questionable techniques could permanently damage some reserves. Notwithstanding the obvious need for serious capital improvements, the U S government Energy Information Agency (EIA) states: “Iraq's oil production costs are amongst the lowest in the world, making it a highly attractive oil prospect.”

However, as of the moment, Iraq deals with just about everyone except American companies who are out of the prospects largely on account of unilateral sanctions imposed by the US government.

Sales

An estimated 30% of Iraqi oil is sold initially to Russian firms. The remaining 70% of Iraq's oil is sold to a grab-bag of countries including Cyprus, Sudan, Pakistan, China, Vietnam, Egypt, Italy, Ukraine, and others. Iraqi oil is normally then resold to a variety of oil companies and middlemen before being purchased by end users, among them: Exxon/Mobil, Chevron, Citgo, BP, Marathon, Coastal, Valero, Koch, and Premcor. In this indirect manner the United States imported an average of 566,000 bbl/d from Iraq in the first half of 2002.

Thus, although U.S. companies do not deal directly with Baghdad and although they are not, at present, involved in production, the United States has become the greatest single end-purchaser of Iraqi oil.

According to ABC News, as of mid 2000, the U.S. refiners largely obtained their crude oil from Russian firms, or middlemen working through Russian firms. However, an authoritative Iraqi source says that as much as 90 percent of the actual amount of Iraq's estimated 1.8 million barrels per day (bpd) are going to U.S. Gulf coast refineries. This was confirmed by the authoritative oil journal Middle East Economic Survey. There is such demand for Iraqi crude in the United States, the report says, that Saddam is banking on it to mitigate the Bush administration's enmity toward his dictatorship in Iraq, and therefore, any attempts to oust him.

Official sales are effected through the United Nations, oil-for-food program. Until early2000, the transactions were posted on a public web site. However, when the Washington Post began to trace deals to companies run by members of the Bush II team, the U.N. closed the site down claiming the information was proprietary. According to the Post, the veil of secrecy allows the U.S and Iraq to engage in their respective public posturing while dealing under the table.

In addition to the above official and U.N. approved sales, the U.S. General Accounting Office estimates that, from 1997 to 2001 Iraq earned $6 billion dollars from illegal oil sales using small tankers sailing under Persian or other false cover.

Development

Russia, which is owed several billions of dollars by Iraq for past arms deliveries, has a strong interest in Iraqi oil development, including a $3.5-billion, 23-year deal to rehabilitate Iraqi oil-fields. The other major development player is China. Another grab-bag of countries from Indonesia to Spain are involved in lesser degrees.

1. Southern Fields:

Iraq hopes to counter production declines in this area by a large-scale program to drill new wells most of which are to be carried out by Russian, Chinese, Iraqi, and Rumanian companies. In October 2001, a joint Russian-Belarus oil company, Slavneft, signed a $52 million service contract with Iraq on the 2-billion-barrel, Suba-Luhais field in southern Iraq, and expecting to sign a service contract to begin drilling later this year. Another Russian company, Lukoil, has a concession to spend $4 billion to develop a "super" oil field in southern Iraq with reserves estimated at 15 billion barrels or the equivalent of the recovery from the North Sea. In October 2002, Lukoil's Chief Executive (Vagit Alekperov) said his belief that the West Qurna contract would "be upheld no matter what happens" in Iraq, and that he had received "guarantees" on this matter from Russian President Vladimir Putin.

2. Northern Fields

The Kirkuk field, with over 10 billion barrels in remaining proven oil reserves, forms the basis for northern Iraqi oil production. In December 2001, the Turkish Petroleum International Corporation won a U.N.-approved contract to drill for oil in northern Iraq, near Kirkuk. Two Russian companies -- Tatneft and Zarubezhneft -- have won U.N. -approved upstream contracts at the Bai Hassan fields.

3. The West & Smaller Fields.

Smaller fields with under 2 billion barrels in reserves also are receiving interest from foreign oil companies, among them Eni (Italy), Repsol (Spain), Pertamina (Indonesia), PetroVietnam, Noor (Syria) and others . Italy's Eni and Spain's Repsol appear to be strong possibilities to develop Nassiriya. Indonesia's Pertamina signed an exploration contract for Block 3 in the Western Desert. Other companies reportedly interested in the Western Desert region include: Repsol, Lundin, Sonatrach, MOL, Petronas, Ranger, and TPAO.

In total, Deutsche Bank estimates that international oil companies in Iraq may have signed deals on new or old fields amounting to nearly 50 billion barrels of reserves, 4 million bbl/d of potential production, and investment potential of more than $20 billion.

©WCG, 2003

A War for Bananas? - Part III - An Afghanistan Sharing Our Values

A bleaker prospect than Afghanistan’s craggy mountains is hard to imagine; but whereas the country may be poor in resources it is rich -- as it has been since Alekhandars’ time -- in routes. As stated a few days before September 11 by the (official) U.S. Energy Information Administration, “Afghanistan's significance from an energy standpoint stems from its geographical position as a potential transit route for oil and natural gas exports from central Asia to the Arabian sea.” Kazakhstani oil and gas do not need to transit Afghanistan to reach Europe; for that the Caspian or Northern pipelines suffice. But Europe is a bit market. The big oil market in the 21st century is Asia and the major player in getting oil there is Unocal.

Experts expect the Asian oil market to double by 2010 whereas Western oil demand is expected to grow at between 0.5 and 1.2 per cent. The American Conference Board calculates that China’s economy grew 8% in 2002 and that her economy will eclipse that of the European Union between 2010 and 2020. Not without reason, Unocal has pursued plans for the construction of a northern gas pipeline through Kyrgyzstan to feed China, a southern line through Afghanistan tofeed India and an oil line to the Arabian Sea, through Afghanistan and Pakistan, to feed both.

John Maresca, vice president of international relations for Unocal states: “At Unocal, we believe the central factor in planning these pipelines should be the location of the future energy markets. Unocal foresees a pipeline which would become part of a regional system that will gather oil from existing pipeline infrastructure in Turkmenistan, Uzbekistan, Kazakhstan and Russia.” The 1,040 mile-long 42-inch pipeline would extend south through Afghanistan to an export terminal on the Pakistan coast. The project would cost $2 billion, but the profits would be enormous.

To complete these projects, Unocal began negotiating with the Taliban in 1995. The company's scheme required a single administration in Afghanistan, which would guarantee safe passage for its goods. It has been said by knowledgeable observers that American policy was written by Unocal and that the dream of securing a pipeline across Afghanistan was the main reason the US was so supportive of the Taliban. Doing the honors, Unocal invited Taliban leaders where they were royally entertained and wooed with offers of 15 cents for every thousand cubic feet of gas pumped through Taliban lands. Said a US diplomat (1997) “the Taliban will probably develop like the Saudis did. There will be Aramco (the former US oil consortium in Saudi Arabia) pipelines, an emir, no parliament and lots of Sharia law. We can live with that.”

However, the Clinton administration could not live with Ossama Bin Laden’s bombing of American embassies. Clinton withdrew support for the Taliban and Unocal had to shelve its pipeline dreams due to the “instability” of the situation. It’s chief consultant on the project Zalmay Khalilzad moved on to the Rand Corporation think tank.

Everything changed again after 9-11. With the Taliban gone, the situation has (at least officially) “stabilized” and Unocal is back in the running. On Dec. 31, Bush appointed Zalmay Kahililzad as his special envoy to Afghanistan. “This is a moment of opportunity for Afghanistan,” Khalizilzad said. Certainly for Unocal. Pakistan's Frontier Post reports that U.S. ambassador Wendy Chamberlain met in October with Pakistan's oil minister to discuss reviving the Unocal project. The Asia Times reports that many industry experts consider Unocal's revived Afghan adventure fatally flawed and expect the U.S. to ultimately wise up and pursue an Iran deal. As of the present, that does not seem to be the case.

Of course, changed events produce changed accents. According to Unocal, “We have worked very closely with the University of Nebraska at Omaha in developing a training program for Afghanistan which will be open to both men and women.” A penny for Unocal is a penny for women’s advancement!

©WCG, 2003
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A War for Bananas? - Part II, Caspi-Stan & The Eternal Pillars of Fire

The Pool

Ancient Zorastrians worshipped the gaseous Eternal Pillars of Fires that shot into the heavens from the soil of Baku. Trudging through Central Asia, in the 13th century, Marco Polo reported rumors of a spring in Baku that produced a black liquid, which, though not edible, was "good to burn," and useful for cleaning the mange off camels. In those days, the West was more interested in pepper and noodles so it would be several centuries before it took a more than passing interest in camel-grooming goo.

By the 19th century, goo was gold. Baku, the Azerbaijani port-capital on the Caspian Sea, was back on the map. In 1873, Robert and Ludwig Nobel made their way to Baku where they taught the natives how to pump -- rather than scoop -- for oil. By the end of the century, the Nobels and the Paris Rothschilds, were competing for control of the region’s reserves which, at the time, supplied approximately half the world’s oil.

During the 1919 Paris Peace Conference, Wilson noted that “There came in a very dignified and interesting group of gentleman from Azerbaijan - I was talking to men who talked the same language that I did in respect of ideals, in respect of conceptions of liberty, in conceptions of right and justice.”

Evidently in respect of the same conceptions, the Bolsheviks annexed Azerbaijan and took control of its resources. Following the collapse of the Soviet Union, the ex-Soviet republics of Central Asia, believing oil to be the fastest way for them to secure their economic and political independence, have sought to exploit their oil wealth.

The region's untapped oil reserves are estimated to be worth up to $2,000 billion. Six US oil giants -- Unocal, Total, Chevron/Texaco, Pennzoil, Amoco and Exxon/Mobil -as well as British Petroleum - have invested billions in the massive oil-field potential in Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan -- the so-called “stan-countries”. According to the Asia Times, Jim Baker, Brent Scrowcroft John Sununu and Dick Cheney -- the Bush I team -- have all closed major deals directly and indirectly on behalf of the oil companies.

Of course, there are always the smaller deals, such as the $30 million contract Haliburton signed in early 2001 with the State Oil Company of Azerbaijan to develop a 6,000 square-meter marine base to support off shore oil construction in the Caspian.

But among the biggest and most geo-politically important deals was a $20 billion production agreement between Chevron/Texaco and Kazahkstan signed in 1993 for the development of the Tengiz field considered the world's largest oil find inthe past two decades. The deal undoubtedly owed a lot to Cheney who served on the Kazakhstan Oil Advisory Board and had close ties with Chevron and Texaco. Exxon/Mobil owns a further 25 per cent interest in the field.

In 2002, Kazahkstan sought to raise its fees, claiming among other things that Chevron and Mobil had created a bio-hazard by dumping and spewing sulfur. The oil companies countered that a little sulfur was no big deal and that the government was trying to extort additional revenue. By the end of the year, the dispute was resolved by comprise.

Although some initial estimates in the frenzied 90’s have turned out to be a little over-optimistic, it remains the case that behind Saudi Arabia and Iraq, the “Caspi-Stan” is probably the world’s third largest pool of oil. But development and production is the easy part. The vexing difficulty is how and through whom to transport the oil and, in particular, how to supply the energy-hungry Asian-Pacific economies.

The Pipes

There are three main pipeline routes for Caspi-Stan oil. Knowing what they are is to know the problems involved.

1. The Northern (East-West) Russian Route - Tengiz - Novorossiysk - Bosporus

The first new $2.65 billion pipeline of the Caspian Pipeline Consortium - a joint venture including Russia, Kazakhstan, Oman, ChevronTexaco, ExxonMobil links the enormous Tengiz oil-field in northwestern Kazakhstan to the Russian port of Novorossiysk on the Black Sea. From there oil can be shipped to the world through the Bosporus. Turkey, however, does not favor this route because, it says, of the environmental hazard to the straits.

2. The Southern (East-West) Turkish Route - Baku-Tbilisi-Ceyhan

The Baku-Ceyhan pipeline cuts diagonally across eastern Turkey to outlet on the Mediterranean at the very juncture between Turkey and Syria. The pipeline consortium for Baku-Ceyhan, led by British Petroleum, is represented by the law firm Baker & Botts, the principal partner of which is Texan superstar James Baker, former U.S. Secretary of State. Turkey favors this route as does Israel.

3. The Trans-Caspian - Tengiz to Baku

The Southern Route is only half the journey, however. It is still necessary to get the oil from Tengiz to Baku To this end the Cheney/Bush White House has promoted the development of multiple trans-Caspian pipelines that would bypass the Northern/Russian route. Enron - the biggest donor to the Bush campaign of 2000 - conducted the feasibility study for the $2.5 billion trans-Caspian pipeline to be built under a joint venture signed almost three years ago between Turkmenistan and Bechtel and General Electric. The go-between in the deal was the Israeli Mehrav Group which, according to the Asia Times, “spent a fortune hiring the Washington lobbying firm Cassidy and Associates to seduce official Washington with the trans-Caspian pipeline project.”

4. The Persian (North-South) Route

In so far as getting oil to the Orient is concerned, the North-South route through Iran is both traditional and logical. From ports on the Persian Sea, oil can be tankered to India, China and Japan without the circuitous bottle neck involved in getting oil from the Mediterranean to the Indian Ocean. As far back as 1979, while Americans were being held hostage in Tehran, Russia and Iran signed up on a joint gas pipeline. Russia is the likely co-partner for the development of parallel oil pipelines.

5. The Great Pipe of China.

A logical alternative which receives little attention in the West is the proposed Eastern Route from Central Asia to China's Xinjiang province. As yet in the proposal stage, such a pipeline (for oil, gas or both) would be under primary control of the China National Petroleum Corporation (CNPC), most likely in partnership with the so-called “Shanghai Six” (the Shangahi Cooperation Organization ) consisting of China and Russia, plus four Central Asian republics (Kazakhstan, Kyrgyzstan, Takijistan and Uzbekistan).

The Plans

Before the September 11 attacks, the US Energy Advisory Board outlined American government thinking on Caspian oil: “Stated US policy goals regarding energy resources in this region include fostering the independence of the states and their ties to the west; breaking Russia's monopoly over oil and gas transport routes; promoting western energy security through diversified suppliers; encouraging the construction of east-west pipelines that do not transit Iran, and denying Iran dangerous leverage over the Central Asian economies.”

Initially, American oil companies were not entirely adverse to transporting oil through a North-South Iranian pipeline, since these would be cheaper than theEast-West Caspian Sea alternatives. However, Iran is anathema in Washington and the Clinton Administration exerted tremendous pressure on the oil giants to build more expensive Caspian pipelines, equally avoiding reliance on Russia.

Given the official mind-set in Washington it is somewhat mystifying why the Mehrav Group should have spent a fortune hiring Cassidy and Associates to lobby for the trans-Caspian pipeline project. Whatever the case, and whether or not Russia is allured with partnerships in the Caspian Pipeline Consortium, Washington’s Central Asian policy is in place.

A front-page story in the Jan. 9, 2002 New York Times revealed that “the United States is preparing a military presence in Central Asia that could last for years,” including the building of a permanent air base in the Kyrgyz Republic, formerly part of the Soviet Union. The Bush II Administration says that it just wants to keep an eye on postwar Afghanistan, but few students of the region buy the official story.

China and Russia reached their own conclusions. In June 2002, they pulled the four central Asian republics into a “Shanghai Cooperation Organization”. Its purpose, according to Jiang Zemin, is to “foster world multi- polarization”, by which he means contesting the uni-polarity of US policy often referred to as the doctrine of “full-spectrum dominance”.

The Asian Times reports that China is using the SCO to align Russia economically and politically towards China and northeast Asia. At the same time, Russia is using the SCO to maintain its traditional hegemony in Central Asia. The name of the game for solidifying the alliance is Russian export of its enormous reserves of oil and gas.

©WCG, 2003
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A War for Bananas? - Part I, Peeling the Options

“Is there any man, is there any woman, let me say any child here, that does not know that the seed of war in the modern world is industrial and commercial rivalry?”

- President Woodrow Wilson, at the Paris Peace Conference in 1919.

It was an odd statement coming from the man who called the Great War a crusade to “make the world safe for Democracy” yet, as millions took to the streets of Europe to protest against an imminent and unilateral invasion of Iraq there was hardly a man, woman or child who would have doubted that Bush & Gang were out for oil.

But it has to be asked: is the impending preemptive strike against Iraq really a “war for oil” the way the United States once waged war for bananas?

Part I - The Options.

The answer to this question is not as easy as one might think. While there is a mass of often repetitive circumstantial evidence pointing to the somewhat obvious fact that American oil companies have interests and aims in Iraqi oil, no direct and hard evidence has come to light proving that specific oil companies are pushing for a war of commodity conquest. If anything, the evidence tends to be that major oil company interests are adverse to war with its attendant risks -- although they are not at all adverse to making as many profitable deals as they can with Hussein or anyone else, as opportunity and circumstance permit. That, after all, is the “bottom line”.

Complicating the search for an answer is the fact that virtually no one speaks plainly about anything. Four years ago, Hans Blix stated that 90-95% of Iraq's arsenal of chemical and biological weapons had been dealt with. There was not a country in the world that had been so comprehensively disarmed. The basic structure of Iraq's weapons-making industry had been destroyed.

Nevertheless, in what surely qualifies as Neo Dada, hours upon hours of diplomatic time, air time and newsprint have been used up in the past months on the issues of inspections, more inspections, no more inspections, more disclosure, enough disclosure and so on. The U.S. Government insists that it has undisclosable information about undisclosed, probable weapons production facilities which might possibly be linkable to known terrorist networks. Just look, ten empty pipes were found!!!! “Precisely” add the French, which is why we need deeper and more penetrating inspections for as long as it takes to find more empty pipes and make sure that none are not empty.

What is clear is only that the parties are jockeying but what they say is otherwise meaningless and therefore of no help in finding out why and over what they are jockeying.

About the only at least straightforward voice in this regard was that of Richard Perle, Bush’s pro-Israeli imperialist adviser who, speaking in November 2002 to a British Parliamentary committee, stated that, regardless of what was found or not found, the United States “reserved the right” to attack Iraq anyway.

The utter meaningless of this remark is what makes it instructive. Just like any boy in the playground, all states “reserve the right to attack”. The question usually concerns why, under what circumstances and pursuant to what provocation. Perle certainly did not need to belabor the obvious to a Parliamentary Committee. Did he then mean, that the United States reserved the right to attack even if it had no right to do so under international law anyway?

What was being signaled by Perle was that all this yabber about inspecting weapons programs was just stuff and nonsense. The United States was itchin’ to go to war against Iraq. Fine. But the question remains why? To steal oil? And if not that, then for what?

One view is that the conflict is for control of oil as the sine qua non of industrial production and development. According to this view, American geo-economic policy in Central Asia and the Middle East is aimed at gaining direct or indirect control of the world’s three most important petroleum reserves: Saudi Arabia, Iraq and the Central Asian countries of the “Caspi-Stan” US interests are already well positioned in Central Asia, so that control over Iraqi oil would be a bonanza in itself as well as the key to leveraging OPEC. One proponent of this view is Michel Collon, Belgian author of "Monopoly". According to him, oil and gas by themselves are not the aim of the U.S.: “If you want to rule the world, you need to control oil. All the oil. Anywhere."

In a recent interview given to England’s socialist leader Tony Benn, Saddam Hussein adopted Collon’s thesis in order to explain American policy. According to Hussein,

“Those people and others have been telling the various US administrations, especially the current one, that if you want to control the world you need to control the oil. Therefore the destruction of Iraq is a pre-requisite to controlling oil. That means the destruction of the Iraqi national identity, since the Iraqis are committed to their principles and rights according to international law and the UN charter.”

"It seems that this argument has appealed to some US administrations especially the current one. If they control the oil in the Middle East, they would be able to control the world. They could dictate to China the size of its economic growth and interfere in its education system and could do the same to Germany and France and perhaps to Russia and Japan. They might even tell the same to Britain if its oil doesn't satisfy its domestic consumption. It seems to me that this hostility is a trademark of the current US administration and is based on its wish to control the world and spread its hegemony.”

Collon’s thesis is true enough, as far as it goes; but it assumes that there is a desire “to rule the world” in the first place. Normally, nations do not desire to rule the world for the pure fun of it, but rather -- as Wilson stated -- for the economic gain empire entails. There can be little dispute that a Plunder Policy is at the heart of the Bush Administration’s thinking on anything. It repudiated the Kyoto Accords, it sought to open up protected Alaska preserves to oil drilling, it has pushed through new regulations that open up millions and millions of beautiful American forest to industry clear-cutting.

This is an administration that makes the Vandals look good. But plundering the world and ruling it are not quite the same thing. Indeed the essence of the public criticism of Bush II policy put forth by members of the Bush I team is that it is possible to plunder without letting loose a conflagration in the Middle East. Put another way, if gas and oil themselves are not the reason for waging war in Iraq what other concrete justification is advanced for the immense expense and risks involved other than some amorphous or testosteronal “desire to rule the world”?

While the evidence of an oil-company motive for war is equivocal, there is a well known paper trail evidencing a hegemonistic motive within the Administration, advanced by former Reaganite advisors who believe in what they postulate as the inherent, a priori good of extending American military and economic power and who see any potential rivalry to this unilateral triumph as something to be destroyed.

In other words, testosteronal or not, there are protagonists within the Administration who proclaim that hegemony is an absolute good in and of itself and who would have it be believed that this final good is the sole motivation of policy.

This is an extremely important distinction; one which lies at the very heart of Orwell’s 1984. Cynical as Woodrow Wilson’s remark might have been, a war for bananas makes at least caloric sense. The exercise of power for its own sake is simply sadism as policy. In 1984’s concluding interrogations Brian reveals to Winston that there is no point in arguing anymore because the Party discovered that there was no need to justify why power is exercised; power is its own absolute good,

“The image of the State in 1984 is that of a boot in the face.”

But that is precisely the manner in which elements within the American political establishment talk. According to them, the first step in this march toward a New American World Order, is regime change in Iraq. As described by the Administration itself, “regime change” begins with a rapid fire barrage of conventional missiles of such intensity and rapidity as to be the non-nuclear “equivalent” of Hiroshima. This is said without a blush; and what “regime change” entails is the further physical obliteration of an already wrecked country and its occupation for some indefinite period of time. Not without reason a “very high U.N. official” -- (one supposes the Secretary General) -- was quoted in recent a Guardian article as calling these advisors “sinister men”.

Studies have concluded that the cost of occupying Iraq would alone exceed any realizable profit from its oil fields and that subjugation of Iraq does not necessarily equate with a bonanza of oil-profits. Furthermore, “stabilizing” Iraq would not be the end-game by any means. Iraq, is only the first of three along the so-called Axis of Evil, and after Iran and North Korea, stands China, who is poised to be the real oil-hungry, industrial power house of the 21st century. If the consequential costs of the war are known beforehand to exceed the potential value of bananas, then the war cannot be said to be waged for economic reasons.

But between war for profit and war for pure hegemony, there is always the third alternative of a war for geo-political security. The difficulty here, is that the United States is in no ways territorially threatened by Iraq. The only countries Iraq has the capacity to threaten are Turkey, Syria, Iran, the Arab states and Israel. But none of the Muslim countries are complaining, at least not in public.

On the other hand, the proponents of the America’s new imperialism assert a compatibility verging on coincidence between Israeli and United States interests. And, indeed, the only other parties in the world calling for an attack and/or destruction of Iraq are various members of the Likud and the Israeli political establishment.

Assuming arguendo that such a destruction would benefit the United States as well, left unexplained is how a new century of perpetual conflict after Iraq with other “potential” threats to American preeminence would be of benefit to anyone. If this is indeed the policy that is afoot, the millions who took to the streets this past weekend protested far more than they knew.

The ensuing installments of this article can only scratch the surface of what is a complicated subject in which hard-proof of critical facts is not easily come by. The best I can hope to do is to summarize some of the information on record so that the reader can draw his own conclusions.

© WCG, 2003
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