The Real Reason For War In Iraq
Iraq War Design
1) Secure U.S./U.K. oil supplies before and after global Peak Oil.
2) To have a large military presence to "dissuade" other oil-producers from moving towards the euro as an oil transaction currency. These are the crucial elements for maintaining U.S. dominance over the world economy.
Early USA Energy
Security Analysis Report
As early as April 1997, a report from the James A. Baker Institute of Public Policy at Rice University addressed the problem of "energy security" for the United States, and noted that the US was increasingly threatened by oil shortages in the face of the inability of oil supplies to keep up with world demand. In particular the report addressed "The Threat of Iraq and Iran" to the free flow of oil out of the Middle East.
The report, *Strategic Energy Policy Challenges for the 21st Century, concluded: "The United States remains a prisoner of its energy dilemma. Iraq remains a de-stabilizing influence to ... the flow of oil to international markets from the Middle East.
Saddam Hussein has also demonstrated a willingness to threaten to use the oil weapon and to use his own export program to manipulate oil markets. Therefore the US should conduct an immediate policy review toward Iraq including military, energy, economic and political/ diplomatic assessments."
Read more ...
*Oil, Petrodollars and the OPEC Euro Question
Defense of the Dollar
But the need to dominate oil from Iraq is also deeply intertwined with the *defense of the dollar. The dollars' current strength is supported by OPEC's requirement (secured by a secret agreement between the US and Saudi Arabia) that all OPEC oil sales be denominated in dollars. This requirement is currently threatened by the desire of some OPEC countries to allow OPEC oil sales to be paid in euros.
"The Federal Reserve's greatest nightmare is that OPEC will switch its international transactions from a dollar standard to a euro standard.
Iraq actually made this switch in Nov. 2000 (when the euro was worth around 82 cents), and has actually made off like a bandit considering the dollar's steady depreciation against the euro. (Note: the dollar declined 17% against the euro in 2002.)
Keeping the Dollar
Standard On Oil Sales
The real reason the Bush administration wants a puppet government in Iraq -- or more importantly, the reason why the corporate-military-industrial network conglomerate wants a puppet government in Iraq -- is so that it will revert back to a dollar standard and stay that way." (While also hoping to veto any wider OPEC momentum towards the euro, especially from Iran -- the 2nd largest OPEC producer who is actively discussing a switch to euros for its oil exports)."
While the dollar is still the standard currency for trading international oil sales, in 2006 Iran intends to set up an oil exchange (or bourse) that would facilitate global trading of oil between industrialized and developing countries by pricing sales in the euro, or “petroeuro.”
The vast majority of the world’s oil is traded on the New York NYMEX (Mercantile Exchange) and the London IPE (International Petroleum Exchange), both of which are operated by an Atlanta-based U.S. conglomerate.
These oil exchanges transact oil trades in the dollar. Tehran’s plan to open an oil exchange that utilized the euro for global oil trades represents a significant obstacle towards stated neoconservative goals of U.S. global domination.
Read more ...
*Oil Currency Geopolitics
*The Real Reasons for the War With Iraq
The World Trade Game
"World trade is now a game in which the US produces dollars and the rest of the world produces things that dollars can buy. The world's interlinked economies no longer trade to capture a comparative advantage; they compete in exports to capture needed dollars to service dollar-denominated foreign debts and to accumulate dollar reserves to sustain the exchange value of their domestic currencies.
World Central Banks
To prevent speculative and manipulative attacks on their currencies, the world's central banks must acquire and hold dollar reserves in corresponding amounts to their currencies in circulation. The higher the market pressure to devalue a particular currency, the more dollar reserves its central bank must hold.
This creates a built-in support for a strong dollar that in turn forces the world's central banks to acquire and hold more dollar reserves, making it stronger. This phenomenon is known as dollar hegemony, which is created by the geopolitically constructed peculiarity that critical commodities, most notably oil, are denominated in dollars.
Dollars and Dollar Oil
Everyone accepts dollars because dollars can buy oil. The recycling of petro-dollars is the price the US has extracted from oil-producing countries for US tolerance of the oil-exporting cartel since 1973.
By definition, dollar reserves must be invested in US assets, creating a capital accounts surplus for the US economy. Even after a year of sharp correction, US stock valuation is still at a 25-year high and trading at a 56 percent premium compared with emerging markets."
Increasing American Foreign Debt Balances
Central bankers around the world do not expect either the US dollar or the US stock markets to sustain their current levels.
Our sinking condition as a debtor nation was not inevitable, in other words, but the reluctance among US governing elites to give up on the past glory and adjust to the new realities.
Dependency might have been averted years ago if US leadership had awakened fully to the financial implications and compelled major trading partners to do the same--that is, to join in adjusting the global trading system so the United States would no longer carry alone such burgeoning trade deficits.
Under the original terms of the General Agreement on Tariffs and Trade, for instance, it is legal for a nation to impose emergency general tariffs to correct a dangerous financial imbalance flowing from trade.
If the United States took such a provocative step, however, it would ignite fierce global opposition and also expose decades of triumphant propaganda. Washington would have to confess to voters that globalization had become a negative proposition for the national balance sheet.
Above all, facing reality would require US elites to resign their inherited role as the singular superpower that runs things--and begin sharing that power with other nations. Neither political party wants to face such a painful retreat on its watch. Besides, for politicians and policy-makers, it feels good to run the world.
In theory, this problem might still be corrected, but only in theory, because it is impossible to imagine such a dramatic policy reversal from Washington without some great crisis to provoke it.
American leadership has instead become increasingly delusional, and blind to the adverse balance of power accumulating against it. Presidents from both parties (Clinton no less than Bush) have embraced the notion that additional trade agreements will eventually solve the US problem by eliminating tariffs and other trade barriers.
We have thirty years of evidence to prove the contrary. The gap between imports and exports keeps growing larger right along with each new agreement.
Reconverting Iraq back to the petrodollar was not the critical issue, but preventing any further momentum towards a petroeuro is a critical component of current US Geostrategy.
While deceiving the American people into war, this administration sent a message to other OPEC-producers -- "You are either with us or against us."
In the end the rules of economics and the laws of physics will prevail over the dreams of Global Empire. It will be increasingly "sensible" for OPEC to re-denominate oil sales in euros once the EU expands.
Peak Oil will usher in an era in which demand for oil will forever outstrip supply. The neoconservatives understand what this means -- the end of US Hyper power, and thus the end of their dreams of a US Global Empire.
The true test of US leadership and the citizenry will be acknowledging that our nation will soon endure some economic hardship. Everyone on earth will be impacted by Peak Oil, and given that reality multilaterialism rather than unilateralism is the only way to create a peaceful outcome.
The industrialized economies need to develop new energy policies and technologies, but here in the US we have the most to lose due to our high consumption rate and structural debt problems. In fact, out entire "suburban" infrastructure was designed for the utilization of automobiles and we do not have enough mass transit in place when Peak Oil arrives.
We have a lot of work to do, not enough time, and too much debt, which further reduces our options. Secondly, our currency is challenged for the first time since WWII with an alternative -- the euro.
So, we have been reduced to using military force to maintain our hegemonic status, but under the neoconservatives we are doing it in such an overt, arrogant way that the world community is objecting. Disparaging the United Nations while unsuccessfully bribing our allies to support the Iraq war is a radical departure from decades of US diplomatic policy.
Furthermore, the world community is probably more aware of the implications of the Project for a New American Century than the US citizens are, and the world does not appear ready to accept the US as a militant, unilateral hyper-power.
Neoconservatives fail to understand that the industrialized world can and will topple us from our hegemonic status if they perceive us to be a greater threat to world stability than the economic disruptions that would occur from the displacement of the dollar standard. Let us hope the world will not allow a disorderly dollar decline or "panic."
The dollar is our Achilles Heel, and it will also be our undoing if we do not change course and compromise with the European Union, otherwise we will probably have military conscription, political repression and tyranny at home, and the American Experiment as we have known it for the past 227 years will end.
This need not be the case.
What we as citizens must realize is that overt pursuit of Empire abroad will ultimately result in tyranny at home. We have already begun this process with the incessant fear mongering, deception and intolerant portrayal of events surrounding the Iraq war. Furthermore, our civil rights and Constitutional protections are being dangerously compromised.
The only way out of this dilemma is international cooperation, real leadership, global monetary reform and sacrifices by the US citizenry regarding energy consumption.
U.S. Politicians are not interested in being truthful with the People, as both parties are more or less in the pockets of the military-energy conglomerates. Real Campaign Finance Reform may be the only way in which the US can enact the sufficient energy reforms that will be required with the onset of Peak Oil.
Resources ...Stumble It!
*Behind the Invasion of Iraq
*Forget the oil price, what about the euro?
*ECB blasts Bush economy
*Iraq and the hidden euro-dollar wars
*The Shifting Geopolitics of the Euro
*When will we buy oil in euros?
*CIA Finds No Evidence Hussein Sought to Arm Terrorists
*Dollar Crisis and American Empire
*U.S. Dollar vs. the Euro:Another Reason for the Invasion of Iraq