Greenspan: Iraq War Is About Oil

Who the hell doesn't know this? This is no great revelation. Bush has all but admitted it.

However, when one hears that the Iraq War is about oil, they may assume that Bush and Cheney wanted more cheap oil. WRONG! What they wanted was to control the oil in Iraq. No oil man wants cheap oil flooding the market.

Nevertheless, the Iraq war wasn't only about controlling the oil supply. It was also about the accrual of tyrannical powers at home and a corporate imperialism abroad. We forget that at our own peril.

AMERICA’s elder statesman of finance, Alan Greenspan, has shaken the White House by declaring that the prime motive for the war in Iraq was oil.

In his long-awaited memoir, to be published tomorrow, Greenspan, a Republican whose 18-year tenure as head of the US Federal Reserve was widely admired, will also deliver a stinging critique of President George W Bush’s economic policies.

However, it is his view on the motive for the 2003 Iraq invasion that is likely to provoke the most controversy. “I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil,” he says.

Greenspan, 81, is understood to believe that Saddam Hussein posed a threat to the security of oil supplies in the Middle East.

Related Links

• Fed veteran Greenspan lambasts George W Bush on economy

• Power, not oil, Mr Greenspan

Britain and America have always insisted the war had nothing to do with oil. Bush said the aim was to disarm Iraq of weapons of mass destruction and end Saddam’s support for terrorism.

(In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. I.U. has no affiliation whatsoever with the originator of this article nor is I.U endorsed or sponsored by the originator.)


The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers.

O-I-L Why Dick Changed His Mind....

Does he still have one to change? If it were only the oil, there are better ways to have dealt with that than to murder thousands, upon thousands of people, wreck the economy and alienate just about the entire planet.

There was more to it than just oil. The insanity also involved Israel and Logistics, abroad and an amazing power grab and assault on the constitution at home.

Everyone knows....hell,we knew before the first bombs fell on Iraq, that the war was for oil, but I believe that control of the oil in Iraq was and is the least of it.
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Why Dick changed his mind
Posted on Saturday, August 18th, 2007

By David Strahan

In a widely viewed You Tube clip, taken from a C-Span interview conducted in 1994, Dick Cheney argues persuasively that the United States was right not to topple Saddam Hussein during the first Gulf War. He cites the potential disintegration of the country and the risk of American casualties as good reasons for the decision not to take Baghdad. So what was it that changed his mind by the turn of the century? An acute awareness of impending peak oil.

In a world of looming oil shortage, Iraq represented a unique opportunity. With 115 billion barrels (officially) Iraq had the world’s third biggest reserves, and after years of war and sanctions they were also the most underexploited. In the late 1990s Iraqi oil production averaged about 2 million barrels per day, but with the necessary investment it was thought its reserves could support three times that output. Not only were sanctions stopping Iraqi production from growing, but also actively damaging the country’s petroleum geology by denying the national oil company access to essential chemicals and equipment. In one of a series of reports to the Security Council, UN specialist inspectors warned in January 2000 that sanctions had already caused irreversible damage to Iraq’s reservoirs, and would continue to lead to “the permanent loss of huge reserves of oil”. But sanctions could not be lifted with Saddam still in place, so if Iraq’s oil was to help defer the onset of global decline, the monster so long supported by the West would have to go.

As I reveal in The Last Oil Shock, the CIA was also well aware of Iraq’s unique value, having secretly paid for new maps of its petroleum geology to be drawn as early as 1998. Cheney also knew, fretting publicly about global oil depletion at a speech in London the following year, where he noted that “the Middle East with two thirds of the world’s oil and lowest cost is still where the prize ultimately lies”. Blair too had reason to be anxious about oil: British North Sea output had peaked in 1999 - and has been falling ever since - while the petrol protests of 2000 had made the importance of maintaining the fuel supply excruciatingly obvious.

Britain and America’s shared energy fears were secretly formalised during the planning for Iraq. It is widely accepted that Blair’s commitment to support the attack dates back to his summit with Bush at Crawford in April 2002. The Times headline was typical that weekend: Iraq Action Is Delayed But ‘Certain’. What is less well known is that at the same summit Blair proposed and Bush agreed to set up the US-UK Energy Dialogue, a permanent diplomatic liason dedicated to “energy security and diversity”. No announcement was made, and the Dialogue’s existence was only later exposed through a US Freedom of Information enquiry by Rob Evans and David Hencke of the Guardian.

Both governments continue to refuse to release minutes of meetings between ministers and officials held under the Dialogue, but among some papers that have been released, one dated February 2003 notes that to meet projected world demand, oil production in the Middle East would have to double by 2030 to over 50 million barrels per day, and proposed “a targeted study to examine the capital and investment requirements of key Gulf countries”. So on the eve of the invasion British and American officials were secretly discussing how to raise oil production from the region and we are invited to believe this is mere coincidence. Iraq was evidently not just about corporate greed but strategic desperation.

The bitterest irony is of course that Dick was right in 1994. The invasion has been a disaster not only for the people of Iraq but also in terms of its hidden agenda - creating conditions that guarantee Iraqi oil production will remain hobbled for years to come.

David Strahan is the author of The Last Oil Shock: A Survival Guide to the Imminent

Extinction of Petroleum Man. www.lastoilshock.com

(In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. I.U. has no affiliation whatsoever with the originator of this article nor is I.U endorsed or sponsored by the originator.)

The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers.

The Declining Dollar

Published on Wednesday, June 13, 2007 by The Nation

Wall Street, Iraq and the Declining Dollar
by Ken Miller

The disastrous impact on the economy of George W. Bush’s response to the attacks of September 2001 is still being measured. On Friday of last week the Bush Administration announced that it would not renominate Gen. Peter Pace as chairman of the Joint Chiefs of Staff. The Administration’s decision to throw a loyal supporter overboard avoids a messy confirmation hearing that would have further focused a war-weary nation’s attention on the past. But sometimes looking backward can help us anticipate the future.

In February of this year, Rep. Henry Waxman’s Committee on Oversight and Government Reform revealed fresh details of how the Coalition Provisional Authority dumped $12 billion in cash–in $100 bills–into Iraq in 2004. Multiple flights of huge C-130 transport planes were required to deliver 363 tons of greenbacks–a modest portion of the $510 billion we have spent so far in Iraq and Afghanistan. By certain measures, this may not be America’s most expensive war. But the worst economic effects are yet to come.

No matter how the Iraq War ends, it is clear that the United States is incapable of militarily securing territory against the wishes of a hostile population. And the Iraq War is at the heart of two alarming trends that are likely to have a negative impact on America’s position in the world: The demand for oil is rising while the supply is declining, and the demand for the US dollar is declining while the supply of dollars is rising.

In the four years since the toppling of Saddam Hussein, the Iraqi oilfields and associated infrastructure have sustained 400 attacks. And because of the situation on the ground, Iraqi oil production, at 1.95 barrels per day during the first quarter of 2007, was far short of the government’s goal of 2.5 million barrels per day and the previous peak of 3.7 million under Saddam. In this asymmetrical war, our enemies are spending a fraction of our costs on improvised explosive devices, chlorine gas and suicide bombers, while we invest heavily in noneffective weapons systems and force structures.

US oil and gas production peaked in the early ’70s, and we are now by far the world’s largest energy importer. The largest oilfields in Saudi Arabia, Kuwait, Iran, Syria, Yemen and Oman are in decline, as are most oilfields in the former Soviet Union, Canada, Central and South America, and on-shore Africa. New fields will be discovered and new technologies brought to bear, but costs of production will be higher than in the past and will require more expensive investments in equipment and technology.

Even as existing fields age, the new economies of India and China require more and more oil to fuel their impressive growth. Although a worldwide depression might result in a temporary drop in the price of oil and other commodities, the long-term imbalance between growing demand and declining supply will eventually reassert itself, creating price increases over time.

Contemporaneously with the supply/demand imbalance in oil and other hard commodities, the Bush Administration’s response to 9/11 has weakened the position of the dollar in the world. The President’s request that Americans continue to spend has struck an all-too-sympathetic chord with the American people. The trade deficits caused by that spending have created a current account deficit equal to 6.2 percent of GDP, sending trillions of dollars into the hands of foreigners.

While we continue to import goods of much greater value than those we export, thus flooding the world with dollars, Bush has pursued a policy of what some have dubbed “military Keynesianism”–that is, the combination of low taxes and high military expenditures. This dynamic forces the Federal Reserve to print money and foster easy credit policies, which will eventually result in higher interest rates, inflation or both.

So the printing presses are spewing out more dollars, which are being collected by China, Japan and others. And those countries are showing signs of concern that they have too much of their foreign exchange reserves tied up in our currency. Likewise, certain other nations are evidencing a declining interest in accepting the dollar as a medium of exchange. It was in October 2000 that Saddam insisted that Iraq’s oil be paid for in euros. But now Russia wants payment for the energy it exports in rubles. Venezuela and Iran insist on euros. Kuwait has recently unpegged its dinar from the dollar in favor of a basket of currencies.

The dollar has indeed shown symptoms of its decline in popularity during the Bush years. The dollar has weakened against the euro, gold, copper and other hard assets and currencies. When Bush came in to office, for example, you could get .987 euros for every dollar. Now you can only get .75. You could say that at $65 per barrel, oil is getting more valuable… or you could say the value of the dollar has declined as measured by oil.

Mainstream economists seem to agree that best-case, the dollar will continue a stately decline, but in a world where the United States has lost so much respect, where we continue to flood the world with dollars and borrow to finance our consumer habit, we could find that one of those sharp, depression-inducing discontinuities occurs–like, say, a run on the dollar.
We are continuing to import 60 percent of the 20.6 million barrels of oil we use daily. And though the size and stability of our economy is likely to insure a demand for the dollar at some level, oil that anyone can buy for hard currency may be getting scarcer. Governments have begun to do deals aimed at taking oil off the market for their own account–deals like the ones China has done with Angola, Brazil, Iran, Nigeria, Venezuela and Sudan. South Korea has just announced it will follow suit.

If our military cannot secure oil by force, and if oil is destined to cost us more and more of a declining currency to buy what is available, then “brand USA” is in trouble. When Bush leaves office, this country will have to begin the difficult task of reversing some very bad trends in the military, fiscal, monetary and energy areas. The pollution of his legacy transcends mere politics.

Ken Miller is chairman and CEO of Ken Miller Capital LLC in New York.

© 2007 The Nation


(In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. I.U. has no affiliation whatsoever with the originator of this article nor is I.U endorsed or sponsored by the originator.)

The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers

Down to The Real Nitty-Gritty in Iraq

The biggest story out of Iraq so far this year may not be the surge, or the latest mass bombing, or the escalating sectarian violence; it might, instead, be a decision that further complicates all of the above. Over the next few weeks, a law to reform Iraq's oil industry — essentially the only source of income the country has aside from U.S. subsidies — is expected to move toward implementation, and the consequences could be enormous.

Coverage of the proposal has focused on the fact that it doesn't break up the country's oil resources, as some had suggested, to various ethnic groups — a piece for the Kurds, a piece for the Shiites, etc. But the real story may be that once the proposal is put into place, international oil companies will have a far better shot at Iraq reserves than ever before.

Iraq has the planet's largest oil reserves, roughly 10 percent of the world total; it's also thought to have the largest unexplored potential, primarily in its western desert. "On top of its 115 billion barrels of proven reserves, Iraq is estimated to have between 100 and 200 billion barrels of further possible (as yet undiscovered) reserves," according to the British public interest group Platform.

Three decades of war and sanctions have left much of Iraq's oil industry decrepit and outmoded. Under Saddam, the industry was state-controlled; the Bush administration made it clear even before the war that it intended to open Iraqi oil up to more private involvement, and ever since 2003 representatives of various major oil companies have been closely involved in guiding Iraqi oil policy. The State Department's Future of Iraq Project, which prior to the invasion drew up a reconstruction blueprint, had a special oil and energy working group whose report recommended using "production sharing agreements" to encourage foreign investment in Iraq's oil industry. Production sharing agreements are contracts between governments and businesses that nominally leave control in the hands of the government, but de facto turn resources over to the private sector.

A few months after U.S. troops rolled into Baghdad, in July 2003, Coalition Provisional Authority head Paul Bremer appointed Ibrahim Bahr al-Uloum, a member of the State Department's energy working group, as Iraq's oil minister. Al-Uloum soon proposed a privatization program, and endorsed production sharing agreements as the route to that goal. Ever since then, the issue of how to open Iraq oil to bidding by international oil firms has been a major topic for Iraqi and American officials.

The Iraqi commission that drew up the current oil-industry proposal reportedly included a representative of BearingPoint, a Virginia-based consulting company (and a spinoff of the accounting firm KPMG) that has a substantial U.S. government contract to assist in developing Iraq's economic infrastructure. A BearingPoint spokesman told Mother Jones that BearingPoint was advising Iraq on matters relating to banking, oil and taxes, but would not comment on details of the oil consulting.

Details of the new law are hard to come by. Iraqi oil ministry spokesman Assem Jihad last week told the International Herald Tribune that it "allows for concessions to global oil companies as a way to achieve the highest benefit for Iraqis, taking into consideration fair competition between these companies regardless of their nationalities. This law stresses that all oil revenues will go to a central fund and then will be distributed to all Iraqis in all regions and provinces according their population."

However, it's clear that tensions over the law remain, especially involving the regional government of Kurdistan. The Kurds are the most vociferous proponents of regional control; they already have handed out small contracts to Canadian, Turkish, and Norwegian oil firms and are currently negotiating a deal with Heritage Oil, a Canadian firm run by the Gulbenkian family. More than a century ago, the Gulbenkians were the first to explore and produce petroleum in what was then Mesopotamia. The British Navy, then switching from coal to oil as the main fuel for its battleships, became a big customer.

Greg Muttitt, co-director of Britain's Platform, says that in the end, the law is likely to represent a compromise between those, such as the Kurds, who argue for regional control and those, including the Iraq Study Group, who argue that the oil industry should be centralized. Either way, the probable Big Oil winners include ExxonMobil, Chevron, BP, Shell, and the Australian company BHP Billiton of Australia, all of whom have been expressing an interest in the Iraqi business, according to Platform.

James Paul, executive director of the Global Policy Forum, a New York-based non-profit public interest group that tracks the Iraq play, says Iraq offers an irresistible return on investment for oil companies: Its crude costs about $1 a barrel to produce, and world market prices hover around $50 a barrel. Since oil revenues will have to underwrite Iraq's reconstruction, notes Paul, the future of the oil industry is perhaps the most critical decision for Iraq's people to make. Yet, he adds, the government seems headed toward passing a "grossly undemocratic" law put together without much public input — but with plenty of advice from the United States.

James Ridgeway is the Washington Correspondent for Mother Jones.

The Nazis, Fascists and Communists were political parties before they became enemies of liberty and mass murderers.

The Real Price of Oil

How much will we pay, for our own destruction?

Is Energo-fascism in Your Future?
The Global Energy Race and Its Consequences (Part 1)
By Michael T. Klare

It has once again become fashionable for the dwindling supporters of President Bush's futile war in Iraq to stress the danger of "Islamo-fascism" and the supposed drive by followers of Osama bin Laden to establish a monolithic, Taliban-like regime -- a "Caliphate" -- stretching from Gibraltar to Indonesia.

The President himself has employed this term on occasion over the years, using it to describe efforts by Muslim extremists to create "a totalitarian empire that denies all political and religious freedom." While there may indeed be hundreds, even thousands, of disturbed and suicidal individuals who share this delusional vision, the world actually faces a far more substantial and universal threat, which might be dubbed: Energo-fascism, or the militarization of the global struggle over ever-diminishing supplies of energy.

Unlike Islamo-fascism, Energo-fascism will, in time, affect nearly every person on the planet. Either we will be compelled to participate in or finance foreign wars to secure vital supplies of energy, such as the current conflict in Iraq; or we will be at the mercy of those who control the energy spigot, like the customers of the Russian energy juggernaut Gazprom in Ukraine, Belarus, and Georgia; or sooner or later we may find ourselves under constant state surveillance, lest we consume more than our allotted share of fuel or engage in illicit energy transactions. This is not simply some future dystopian nightmare, but a potentially all-encompassing reality whose basic features, largely unnoticed, are developing today.

These include:

* The transformation of the U.S. military into a global oil protection service whose primary mission is to defend America's overseas sources of oil and natural gas, while patrolling the world's major pipelines and supply routes.

* The transformation of Russia into an energy superpower with control over Eurasia's largest supplies of oil and natural gas and the resolve to convert these assets into ever increasing political influence over neighboring states.

* A ruthless scramble among the great powers for the remaining oil, natural gas, and uranium reserves of Africa, Latin America, the Middle East, and Asia, accompanied by recurring military interventions, the constant installation and replacement of client regimes, systemic corruption and repression, and the continued impoverishment of the great majority of those who have the misfortune to inhabit such energy-rich regions.

* Increased state intrusion into, and surveillance of, public and private life as reliance on nuclear power grows, bringing with it an increased threat of sabotage, accident, and the diversion of fissionable materials into the hands of illicit nuclear proliferators.

Together, these and related phenomena constitute the basic characteristics of an emerging global Energo-fascism. Disparate as they may seem, they all share a common feature: increasing state involvement in the procurement, transportation, and allocation of energy supplies, accompanied by a greater inclination to employ force against those who resist the state's priorities in these areas. As in classical twentieth century fascism, the state will assume ever greater control over all aspects of public and private life in pursuit of what is said to be an essential national interest: the acquisition of sufficient energy to keep the economy functioning and public services (including the military) running.

The Demand/Supply Conundrum

Powerful, potentially planet-altering trends like this do not occur in a vacuum. The rise of Energo-fascism can be traced to two overarching phenomena: an imminent collision between energy demand and energy supplies, and the historic migration of the center of gravity of planetary energy output from the global north to the global south.

For the past 60 years, the international energy industry has largely succeeded in satisfying the world's ever-growing thirst for energy in all its forms. When it comes to oil alone, global demand jumped from 15 to 82 million barrels per day between 1955 and 2005, an increase of 450%. Global output rose by a like amount in those years. Worldwide demand is expected to keep growing at this rate, if not faster, for years to come -- propelled in large part by rising affluence in China, India, and other developing nations. There is, however, no expectation that global output can continue to keep pace.

Quite the opposite: A growing number of energy experts believe that the global output of "conventional" (liquid) crude oil will soon reach a peak -- perhaps as early as 2010 or 2015 -- and then begin an irreversible decline. If this proves to be the case, no amount of inputs from Canadian tar sands, shale oil, or other "unconventional" sources will prevent a catastrophic liquid-fuel shortage in a decade or so, producing widespread economic trauma. The global supply of other primary fuels, including natural gas, coal, and uranium is not expected to contract as rapidly, but all of these materials are finite, and will eventually become scarce.

Coal is the most plentiful of the three; if consumed at current rates, it can be expected to last for perhaps another century and a half. If, however, it is used to replace oil (in various coal-to-liquid schemes), it will disappear much more rapidly. This does not, of course, address coal's disproportionate contribution to global warming; if there is no change in the way it is burned in power plants, the planet will become inhospitable long before the last coal mine is exhausted.
Natural gas and uranium will outlast petroleum by a decade or two, but they too will eventually reach peak output and begin to decline. Natural gas will simply disappear, just like oil; any future scarcity of uranium can to some degree be overcome through the greater utilization of "breeder reactors," which produce plutonium as a byproduct; this substance can, in turn, be used as a reactor fuel in its own right. But any increased use of plutonium will also vastly increase the risk of nuclear-weapons proliferation, producing a far more dangerous world and a corresponding requirement for greater government oversight of all aspects of nuclear power and commerce.

Such future possibilities are generating great anxiety among officials of the major energy-consuming nations, especially the United States, China, Japan, and the European powers. All of these countries have undertaken major reviews of energy policy in recent years, and all have come to the same conclusion: Market forces alone can no longer be relied upon to satisfy essential national energy requirements, and so the state must assume ever-increasing responsibility for performing this role. This was, for example, the fundamental conclusion of the National Energy Policy adopted by the Bush administration on May 17, 2001 and followed slavishly ever since, just as it is the official stance of China's Communist regime. When resistance to such efforts is encountered, moreover, government officials only wield the power of the state more regularly and with a heavier hand to achieve their objectives, whether through trade sanctions, embargoes, arrests and seizures, or the outright use of force. This is part of the explanation for Energo-fascism's emergence.

Its rise is also being driven by the changing geography of energy production. At one time, most of the world's major oil and natural gas wells were located in North America, Europe, and the European sectors of the Russian Empire. This was no accident. The major energy companies much preferred to operate in hospitable countries that were close at hand, relatively stable, and disinclined to nationalize private energy deposits. But these deposits have now largely been depleted and the only areas still capable of satisfying rising world demand are located in Africa, Asia, Latin America, and the Middle East.

The countries in these regions were nearly all subject to colonial rule and still harbor deep distrust of foreign involvement; many also house ethnic separatist groups, insurgencies, or extremist movements that make them especially inhospitable to foreign oil companies. Oil production in Nigeria, for example, has been sharply curtailed in recent months by an insurgency in the impoverished Niger Delta. Members of poor tribal groups that have suffered terribly from the environmental devastation wrought by oil-company operations in their midst, while receiving few tangible benefits from the resulting oil revenues, have led it; most of the profits that remain in-country are pilfered by ruling elites in Abuja, the capital. Combine this sort of local resentment with lack of security and often shaky ruling groups, and it's hardly surprising that the leaders of the major consuming nations have increasingly been taking matters into their own hands -- arranging preemptive oil deals with compliant local officials and providing military protection, where needed, to ensure the safe delivery of oil and natural gas.

In many cases, this has resulted in the establishment of oil-driven, patron-client relations between major consuming nations and their leading suppliers, similar to the long-established U.S. protectorate over Saudi Arabia and the more recent U.S. embrace of Ilham Aliyev, the president of Azerbaijan. Already we have the beginnings of the energy equivalent of a classic arms race, combined with many of the elements of the "Great Game" as once played by colonial powers in some of the same parts of the world. By militarizing the energy policies of consuming nations and enhancing the repressive capacities of client regimes, the foundations are being laid for an Energo-fascist world.

The Pentagon: A Global Oil-Protection Service

The most significant expression of this trend has been the transformation of the U.S. military into a global oil-protection service whose primary function is the guarding of overseas energy supplies as well as their global delivery systems (pipelines, tanker ships, and supply routes). This overarching mission was first articulated by President Jimmy Carter in January 1980, when he described the oil flow from the Persian Gulf as a "vital interest" of the United States, and affirmed that this country would employ "any means necessary, including military force" to overcome an attempt by a hostile power to block that flow.
When President Carter issued this edict, quickly dubbed the Carter Doctrine, the United States did not actually possess any forces capable of performing this role in the Gulf. To fill this gap, Carter created a new entity, the Rapid Deployment Joint Task Force (RDJTF), an ad hoc assortment of U.S-based forces designated for possible employment in the Middle East. In 1983, President Reagan transformed the RDJTF into the Central Command (Centcom), the name it bears today. Centcom exercises command authority over all U.S. combat forces deployed in the greater Persian Gulf area including Afghanistan and the Horn of Africa. At present, Centcom is largely preoccupied with the wars in Iraq and Afghanistan, but it has never given up its original role of guarding the oil flow from the Persian Gulf in accordance with the Carter Doctrine.

The greatest danger to the Persian Gulf oil flow is now said to emanate from Iran, which has threatened to choke off all oil shipments through the vital Strait of Hormuz (the narrow passageway at the mouth of the Gulf) in the event of an American air assault on its nuclear facilities. In possible anticipation of such a move, the Pentagon recently ordered additional air and naval forces into the Gulf and replaced General John Abizaid, the Centcom Commander, who favored diplomatic engagement with Iran and Syria, with Admiral William Fallon, the Commander of the Pacific Command (Pacom) and an expert in combined air and naval operations. Fallon arrived at Centcom just as President Bush, in a nationally televised speech on January 10, announced the deployment of an additional carrier battle group to the Gulf and warned of harsh military action against Iran if it failed to halt its support for insurgents in Iraq and its pursuit of uranium-enrichment technology.

When first promulgated in 1980, the Carter Doctrine was aimed principally at the Persian Gulf and surrounding waters. In recent years, however, American policymakers have concluded that the United States must extend this kind of protection to every major oil-producing region in the developing world. The logic for a Carter Doctrine on a global scale was first spelled out in a bipartisan task force report, "The Geopolitics of Energy," published by the Washington-based Center for Strategic and International Studies (CSIS) in November 2000. Because the United States and its allies are becoming increasingly dependent on energy supplies from unstable overseas suppliers, the report concluded, "[T]he geopolitical risks attendant to energy availability are not likely to abate."

Under these circumstances, "the United States, as the world's only superpower, must accept its special responsibilities for preserving access to worldwide energy supply."

This sort of thinking -- embraced by senior Democrats and Republicans alike -- appears to have governed American strategic thinking since the late 1990s. It was President Clinton who first put this policy into effect, by extending the Carter Doctrine to the Caspian Sea basin. It was Clinton who originally declared that the flow of oil and gas from the Caspian Sea to the West was an American security priority, and who, on this basis, established military ties with the governments of Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, and Uzbekistan. President Bush has substantially upgraded these ties -- thereby laying the groundwork for a permanent U.S. military presence in the region -- but it is important to view this as a bipartisan effort in accordance with a shared belief that protection of the global oil flow is increasingly not just a vital function, but the vital function of the American military.

More recently, President Bush has extended the reach of the Carter Doctrine to West Africa, now one of America's major sources of oil. Particular emphasis is being placed on Nigeria, where unrest in the Delta (which holds most of the country's onshore petroleum fields) has produced a substantial decline in oil output. "Nigeria is the fifth largest source of U.S. oil imports," the State Department's Fiscal Year 2007 Congressional Budget Justification for Foreign Operations declares, "and disruption of supply from Nigeria would represent a major blow to U.S. oil security strategy." To prevent such a disruption, the Department of Defense is providing Nigerian military and internal security forces with substantial arms and equipment intended to quell unrest in the Delta region; the Pentagon is also collaborating with Nigerian forces in a number of regional patrol and surveillance efforts aimed at improving security in the Gulf of Guinea, where most of West Africa's offshore oil and gas fields are located.
Of course, senior officials and foreign policy elites are generally loathe to acknowledge such crass motivations for the utilization of military force -- they much prefer to talk about spreading democracy and fighting terrorism. Every once in a while, however, a hint of this deep energy-based conviction rises to the surface. Especially revealing is a November 2006 task force report from the Council on Foreign Relations on "National Security Consequences of U.S. Oil Dependency." Co-chaired by former Secretary of Defense James R. Schlesinger and former CIA Director John Deutsch, and endorsed by a slew of elite policy wonks from both parties, the report trumpeted the usual to-be-ignored calls for energy efficiency and conservation at home, but then struck just the militaristic note first voiced in the 2000 CSIS report (which Schlesinger also co-chaired):

"Several standard operations of U.S. regionally deployed forces [presumably Centcom and Pacom] have made important contributions to improving energy security, and the continuation of such efforts will be necessary in the future. U.S. naval protection of the sea-lanes that transport oil is of paramount importance."

The report also called for stepped up U.S. naval engagement in the Gulf of Guinea off the coast of Nigeria.

When expressing such views, U.S. policymakers often adopt an altruistic stance, claiming that the United States is performing a "social good" by protecting the global oil flow on behalf of the world community. But this haughty, altruistic posture ignores crucial aspects of the situation:

* First, the United States is the world's leading gas guzzler, accounting for one out of every four barrels of oil consumed daily around the world.

* Second, the pipelines and sea lanes being protected by American soldiers and sailors at risk of life and limb are largely those oriented toward the United States and close allies like Japan and the NATO countries.

* Third, it is often specifically American-based corporations whose overseas operations are being protected by U.S. forces in turbulent areas abroad, again at significant risk to the military personnel involved.

* Fourth, the Pentagon is itself one of the world's great oil guzzlers, consuming 134 million barrels of oil in 2005, as much as the entire nation of Sweden.
So while it is true that other countries may obtain some benefits from the activities of the American military, the primary beneficiaries are the American economy and giant U.S. corporations; the primary losers are the American soldiers who risk their lives every day to protect the pipelines and refineries, the poor of these countries who see little or no benefit from the extraction of their natural resources, and the global environment as a whole.

The cost of this immense undertaking, in both blood and treasure, is enormous and it's still on the rise. There is, first of all, the war in Iraq, which may have been sparked by a variety of motives, but cannot in the end be separated from the historic mission first laid out by President Carter of eliminating any potential threat to the free flow of oil from the Persian Gulf. An assault on Iran would also have a number of motives, but it, too, would be tied to this mission in the final analysis -- even if it had the perverse effect of closing off oil supplies, driving up energy prices, and throwing the global economy into a tailspin. And there are sure to be more wars over oil after these, with more American casualties and more victims of American missiles and bullets.

The cost in dollars will also be great. Even if the war in Iraq is excluded from the tally, the United States spends about one-fourth of its defense budget, or some $100 billion per year, on Persian Gulf-related expenses -- the approximate annual price-tag for enforcement of the Carter Doctrine. One can argue about what percentage of the approximately $1 trillion cost of the war in Iraq should be added to this tally, but surely we are minimally talking about many hundreds of billions of dollars with no end in sight. Protection of pipelines and tanker routes in the Indian Ocean, the Pacific, the Gulf of Guinea, Colombia, and the Caspian Sea region adds additional billions to this figure.

These costs will snowball in the future as the United States becomes predictably more dependent on energy from the global south, as resistance to Western exploitation of its oil fields grows, as an energy race with newly ascendant China and India revs up, and as American foreign-policy elites come to rely increasingly on the U.S. military to overcome this resistance. Eventually, the escalation of these costs will require higher domestic taxes or diminished social benefits, or both; at some point, the growing need for manpower to guard all these overseas oil fields, refineries, pipelines, and tanker routes could entail resumption of the military draft. This will generate widespread resistance to these policies at home -- and this, in turn, may trigger the sorts of repressive government crackdowns that would throw an ever darkening shadow of Energo-fascism over our world.

Michael T. Klare is a professor of peace and world security studies at Hampshire College and the author of Blood and Oil: The Dangers and Consequences of America's Growing Dependence on Imported Petroleum (Owl Books).

[Note: Look for part two of Michael Klare's "Is Energo-fascism in Your Future?" -- "Petro-power and the Nuclear Renaissance" -- later this week.]

Copyright 2007 Michael T. Klare

Future of Iraq: The spoils of war

How the West will make a killing on Iraqi oil riches

By Danny Fortson, Andrew Murray-Watson and Tim Webb
Published: 07 January 2007

Iraq's massive oil reserves, the third-largest in the world, are about to be thrown open for large-scale exploitation by Western oil companies under a controversial law which is expected to come before the Iraqi parliament within days.

The US government has been involved in drawing up the law, a draft of which has been seen by The Independent on Sunday. It would give big oil companies such as BP, Shell and Exxon 30-year contracts to extract Iraqi crude and allow the first large-scale operation of foreign oil interests in the country since the industry was nationalised in 1972.

The huge potential prizes for Western firms will give ammunition to critics who say the Iraq war was fought for oil. They point to statements such as one from Vice-President Dick Cheney, who said in 1999, while he was still chief executive of the oil services company Halliburton, that the world would need an additional 50 million barrels of oil a day by 2010. "So where is the oil going to come from?... The Middle East, with two-thirds of the world's oil and the lowest cost, is still where the prize ultimately lies," he said.

Oil industry executives and analysts say the law, which would permit Western companies to pocket up to three-quarters of profits in the early years, is the only way to get Iraq's oil industry back on its feet after years of sanctions, war and loss of expertise. But it will operate through "production-sharing agreements" (or PSAs) which are highly unusual in the Middle East, where the oil industry in Saudi Arabia and Iran, the world's two largest producers, is state controlled.

Opponents say Iraq, where oil accounts for 95 per cent of the economy, is being forced to surrender an unacceptable degree of sovereignty.

Proposing the parliamentary motion for war in 2003, Tony Blair denied the "false claim" that "we want to seize" Iraq's oil revenues. He said the money should be put into a trust fund, run by the UN, for the Iraqis, but the idea came to nothing. The same year Colin Powell, then Secretary of State, said: "It cost a great deal of money to prosecute this war. But the oil of the Iraqi people belongs to the Iraqi people; it is their wealth, it will be used for their benefit. So we did not do it for oil."

Supporters say the provision allowing oil companies to take up to 75 per cent of the profits will last until they have recouped initial drilling costs. After that, they would collect about 20 per cent of all profits, according to industry sources in Iraq. But that is twice the industry average for such deals.

Greg Muttitt, a researcher for Platform, a human rights and environmental group which monitors the oil industry, said Iraq was being asked to pay an enormous price over the next 30 years for its present instability. "They would lose out massively," he said, "because they don't have the capacity at the moment to strike a good deal."

Iraq's Deputy Prime Minister, Barham Salih, who chairs the country's oil committee, is expected to unveil the legislation as early as today. "It is a redrawing of the whole Iraqi oil industry [to] a modern standard," said Khaled Salih, spokesman for the Kurdish Regional Government, a party to the negotiations. The Iraqi government hopes to have the law on the books by March.

Several major oil companies are said to have sent teams into the country in recent months to lobby for deals ahead of the law, though the big names are considered unlikely to invest until the violence in Iraq abates.

James Paul, executive director at the Global Policy Forum, the international government watchdog, said: "It is not an exaggeration to say that the overwhelming majority of the population would be opposed to this. To do it anyway, with minimal discussion within the [Iraqi] parliament is really just pouring more oil on the fire."

Vince Cable, the Liberal Democrat Treasury spokesman and a former chief economist at Shell, said it was crucial that any deal would guarantee funds for rebuilding Iraq. "It is absolutely vital that the revenue from the oil industry goes into Iraqi development and is seen to do so," he said. "Although it does make sense to collaborate with foreign investors, it is very important the terms are seen to be fair."