Geopolitics – Sept 18

September 18, 2008

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U.S. pushing through dozens of foreign weapons deals

Eric Lipton, International Herald Tribune
… The trend, which started in 2006, is most pronounced in the Middle East, but it reaches into northern Africa, Asia, Latin America, Europe and even Canada, through dozens of deals that senior Bush administration officials say they are confident will both tighten military alliances and combat terrorism.

… The growing tally of international weapon deals, which started its sharp increase in 2006, is now provoking questions among some advocates of arms control and some members of Congress.

“Sure, this is a quick and easy way to cement alliances,” said William Hartung, an arms control specialist at the New America Foundation, a public policy institute. “But this is getting out of hand.”

Congress is notified before major arms sales deals are completed between foreign governments and the Pentagon. While lawmakers have the power to formally object and block any individual sale, they rarely use it.
(14 September 2008)
EB contributor CS writes:
Perhaps a graph correlating the plateau of petrol and the rise of small arms systems is in order…


China paper urges new currency order after “tsunami”

Chris Buckley, Reuters
Threatened by a “financial tsunami,” the world must consider building a financial order no longer dependent on the United States, a leading Chinese state newspaper said on Wednesday.

… The People’s Daily is the official newspaper of China’s ruling Communist Party, and the overseas edition is a smaller circulation offshoot of the main paper.

Its pronouncements do not necessarily directly voice leadership views. But the commentary by a professor at Shanghai’s Tongji University, as well as an essay in a Party journal, underscored official alarm at the turmoil in world financial markets.

… The commentary suggested China must brace for grave economic fallout and look to alternatives, saying the crisis brings to mind the Great Depression of the 1930s.
(17 September 2008)


Low Crude Prices – Cold War Flashback?

Rick Lakin, Yuku (discussion forum)
Do you remember back in the 80s when President Ronald Reagan talked the Saudis into opening up the spigot full-blast, crashing the price of oil and bankrupting the Soviet Union? Many say that was the root cause of the end of the cold war.

Flash forward to the Summer of 2008. The Russians are again acting like the Evil Empire of old. They are threatening their neighbors with a renewed military.

They are threatening Europe with Oil Hegemony. And then they invade one of their old satellites.

What is the United States doing? The standard cold-war stuff. We threaten with diplomacy. We play wargames and place our carriers off the coast of Russia’s neighbors. Is that all we are doing? Maybe not.

Maybe we are using our last gasp of economic superpower to use the monetary system to again crash the price of oil and bankrupt the Russian economy and put them in their place. On Tuesday, the Russian stock market dropped 17% as oil dropped almost $10 in two days. This would not be a solo act. Almost everyone in the world hates the power the United States wields but they know that our power plays are a whole lot more benign than those of an emboldened, enrichened and empowered Russian Empire. So, my guess is that the Europeans, the Japanese and probably OPEC are in on it as well. Perhaps, even the Chinese are putting the weight of their 1.2 trillion in dollar denominated securities behind this effort.

The final question is, How low do we have to push oil to topple Putin and restore Russia on the path to democratic reform? And the one after that is how badly will we screw up our own economies in order to destroy Russia’s?

Just a few thoughts after ingesting the news of the day.
(16 September 2008)
Rick Lakin adds:
I offer this to those who like to ponder conspiracy theories. There are probably many reasons for the recent stiff drop in crude prices, the most reasonable being demand destruction. But this possible explanation might encourage some thought as Oil continues to drop in opposition to strong fundamentals, extreme weather events and our continued decreases in worldwide production due to depletion.

BA:
Interesting thought, but I agree with the author that this scenario is unlikely in 2008. What I find incredible – but is apparently accepted – is that the United States hastened the end of the Soviet Union by pushing for low oil prices back in the days of Ronald Reagan. -BA


Medvedev: Russia needs to mark its Arctic territory

Reuters, The Independent
Russia should pass a law marking its territory in the disputed Arctic where it claims a large share of the mineral resources, Russian President Dmitry Medvedev said today.

Geologists believe valuable energy and mineral deposits lie below the Arctic seabed and it is only a matter of time before global warming melts the icecap making them accessible to miners.

“We must finalise and adopt a federal law on the southern border of Russia’s Arctic zone,” Medvedev told Russia’s security council according to Interfax news agency.

“It is our duty to our direct descendents, we have to ensure the long-term national interests of Russia in the Arctic.”…
(17 September 2008)


Tags: Arctic oil, Fossil Fuels, Geopolitics & Military, Globalisation, Oil