Politics & economics – Mar 17

March 16, 2006

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2006


Latin America and Asia are at last breaking free of Washington’s grip

Noam Chomsky, The Guardian
The US-dominated world order is being challenged by a new spirit of independence in the global south
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The prospect that Europe and Asia might move towards greater independence has troubled US planners since the second world war. The concerns have only risen as the “tripolar order” – Europe, North America and Asia – has continued to evolve.

Every day Latin America, too, is becoming more independent. Now Asia and the Americas are strengthening their ties while the reigning superpower, the odd man out, consumes itself in misadventures in the Middle East.

Regional integration in Asia and Latin America is a crucial and increasingly important issue that, from Washington’s perspective, betokens a defiant world gone out of control. Energy, of course, remains a defining factor – the object of contention – everywhere.
(15 March 2006


New book by Kevin Phillips: “American Theocracy: The Peril and Politics of Radical Religion, Oil, and Borrowed Money in the 21st Century”

Press Release, Penguin Books via Scoop NZ
Descriptions:
…From Ancient Rome to the British Empire, Phillips demonstrates that every world-dominating power has been brought down by an overlapping set of problems: a foolish combination of global overreach, militant religion, diminishing resources, and ballooning debt. It is exactly this nexus of ills that has come to define American’s political and economic identity at the start of this century. Matching his command of history with a penetrating analysis of contemporary politics, Phillips surveys a century of foreign policy and wars in the Middle East, showing how all, to one degree or another, reflected our ever-growing preoccupation with oil. Today, that dangerous inheritance includes clumsy military miscalculations, the ruinous occupation of Iraq, and sky-high oil prices.

… Kevin Phillips is a former Republican strategist, has been a political and economic commentator for more than three decades. He writes for the Los Angeles Times as well as Harper’s Magazine and Time. His thirteen books include the New York Times bestsellers American Dynasty, The Politics of Rich and Poor and Wealth and Democracy.

Excerpt from the Preface:
…Oil, as everyone knows, became the all-important fuel of American global ascendancy in the twentieth century. But before that, nineteenth-century Britain was the coal hegemon and seventeenth-century Dutch fortune harnessed the winds and the waters. Neither nation could maintain its global economic leadership when the world moved toward a new energy regime. Today’s United States, despite denials, has obviously organized much of its overseas military posture around petroleum, protecting oil fields, pipelines, and sea lanes.

But U.S. preoccupation with the Middle East has two dimensions. In addition to its concerns with oil and terrorism, the White House is courting end-times theologians and electorates for whom the holy lands are already a battleground of Christian destiny. Both pursuits, oil and biblical expectations, require a dissimulation in Washington that undercuts the U.S. tradition of commitment to the role of an informed electorate.

The political corollary—fascinating but appalling—is the recent transformation of the Republican presidential coalition. Since the elections of 2000 and especially of 2004, three pillars have become increasingly central: (1) the oil–national security complex, with its pervasive interests; (2) the religious right, with its doctrinal imperatives and massive electorate; and (3) the debt-dealing financial sector, which extends far beyond the old symbolism of Wall Street. In December 2004 The New York Times took up the term “borrower-industrial complex” to identify one profitable engine of exploding consumer debt.

…While studying economic geography and history in Britain some years earlier, I had been intrigued by the Eurasian “heartland” theory of Sir Halford Mackinder, a prominent early-twentieth-century geographer. Control of the heartland, Mackinder argued, would determine control of the world.

…Mackinder’s worldview has its own second wind because his Eurasian cockpit has reemerged as the pivot of the international struggle for oil. In a similar context, the American heartland, from Wyoming, Colorado, and New Mexico to Ohio and the Appalachian coal states, has become (along with the rest of the onetime Confederacy) the seat of a fossil-fuels political alliance—an electoral hydrocarbon coalition. It cherishes SUVs and easy carbon dioxide emissions policy, and applauds preemptive U.S. air strikes on uncooperative, terrorist-coddling Persian Gulf countries fortuitously blessed with huge reserves of oil.

Because the United States is beginning to run out of its own oil sources, a military solution to an energy crisis is hardly lunacy. Neither Caesar nor Napoléon would have flinched, and the temptation, at least, is understandable. What Caesar and Napoléon did not face, but less able American presidents do, is that bungled overseas military embroilment, unfortunate in its own right, could also boomerang economically. The United States, some $4 trillion in hock internationally, has become the world’s leading debtor, increasingly nagged by worry that some nations will sell dollars in their reserves and switch their holdings to rival currencies. Washington prints bonds and dollar-green IOUs, which European and Asian bankers accumulate until for some reason they lose patience. This is the debt Achilles’ heel, which stands alongside the oil Achilles’ heel.
(16 March 2006)
Related: Book review at Salon (requires subscription or ad-watching):

… Much of what [Phillips] writes in individual chapters has been covered elsewhere in numerous books about peak oil, the religious right and economic profligacy.

But Phillips’ book is very valuable in the way he brings all the strands together and puts them in context. He has a history of good judgment that affords him the authority to make big-picture claims: In 1993, the New York Times Book Review wrote of him, “through more than 25 years of analysis and predictions, nobody has been as transcendentally right about the outlines of American political change as Kevin Phillips.” Other recent books foresee American meltdown; James Howard Kunstler’s “The Long Emergency” deals with some of the same gathering threats as “American Theocracy.” Kunstler is a far more engaging writer than Phillips, but he’s also more prone to doomsday speculation, and he sometimes seems to relish the apocalyptic scenario he conjures. It’s Phillips’ sobriety and gravitas that gives “American Theocracy” ballast, and that makes it frightening.

The first section, “Oil and American Supremacy,” covers the history of oil in American politics, both foreign and domestic, and what it means for America when oil starts running out. The subject of peak oil has been extensively covered elsewhere, yet it remains on the fringes of much of the political debate in America, despite its massive implications. Essentially, peak oil is the point at which more than half the earth’s available oil has been extracted. “After this stage, getting each barrel out requires more pressure, more expense, or both,” writes Phillips. “After a while, despite nominal reserves that may be considerable, more energy is required to find and extract a barrel of oil than the barrel itself contains.” Before that point comes, scarcity will drive prices to unheard-of levels. If that happens, the entire American way of life — the car culture, agribusiness, frequent air travel — will become untenable.

Experts differ about when we might pass the peak, but as Phillips notes, “even relative optimists see it only two or three decades away.” Unfortunately, the United States is uniquely unable to grapple with the mere idea of life after cheap gasoline, because the country’s entire sprawling infrastructure was built on the assumption that oil would remain plentiful. Writes Phillips, “[B]ecause the twenty-first-century United States has a pervasive oil and gas culture from its own earlier zenith — with an intact cultural and psychological infrastructure — it’s no surprise that Americans cling to and defend an ingrained fuel habit …The hardening of old attitudes and reaffirmation of the consumption ethic since those years may signal an inability to turn back.”


A Glimpse of our geopolitical future — The East and South China Seas

Dave, The Oil Drum
Geopolitical conflicts have obvious effects on the world’s supply of oil & natural gas. Mostly, such conflicts are discussed in the context of the Middle East, Russia as a supplier or West Africa. However, there is an underpublicized set of conflicts in the maritime areas of East Asia over who owns the development rights to disputed oil & natural gas rights in those offshore areas. The hottest of these conflicts is between China and Japan over drilling rights in the East China Sea (Asian Times) and among various nations adjacent to the South China Sea. And there are other disputes as well. Whether these rights of ownership are resolved amicably or through intimidation and military conflict will affect how various nations fare in obtaining their fossil fuels supplies in the future and hence their security. Let’s take a closer look at geopolitical disputes in East Asia’s ocean regions.

To understand what’s going on in the China & Japan dispute, we need to be acquainted with the Law of the Sea and what are called exclusive economic zones.
(15 March 2006)

US postwar Iraq strategy a mess, Blair was told
Ewen MacAskill, Guardian
Senior British diplomatic and military staff gave Tony Blair explicit warnings three years ago that the US was disastrously mishandling the occupation of Iraq, according to leaked memos.

John Sawers, Mr Blair’s envoy in Baghdad in the aftermath of the invasion, sent a series of confidential memos to Downing Street in May and June 2003 cataloguing US failures. With unusual frankness, he described the US postwar administration, led by the retired general Jay Garner, as “an unbelievable mess” and said “Garner and his top team of 60-year-old retired generals” were “well-meaning but out of their depth”.
(14 March 2006)
Garner apparently was morally opposed to privatising Iraqi industries, especially the oil. Perhaps that’s one reason he was so frankly attacked. -AF


Both Reds and Blues go green on energy

Michael Dimock, Pew Research Center for the People & the Press
But Parties Split Internally on Environmental Protections
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With high fuel prices and instability in the Middle East, Americans are increasingly concerned about the nation’s energy situation. In January, 58% rated “dealing with the nation’s energy problem” a top priority, up from just 47% a year ago and 40% in January of 2003.

And while finding new energy and protecting the environment are often seen as conflicting goals, the public makes no such distinction. In concert with rising energy worries, Americans are becoming increasingly anxious about the environment. In January, 57% rated “protecting the environment” a top priority, up from 49% a year ago and just 39% in 2003.

The outgrowth of this concern about both energy and the environment is that the public expresses almost universal support for solutions that address both problems at the same time. Fully 86% favor the government requiring better fuel efficiency standards for cars, trucks and SUVs, and 82% favor increased federal funding for research on wind, solar and hydrogen energy.

Even more striking in today’s politicized environment, is the level of bipartisan consensus behind these proposals.
(28 February 2006)
Related:
Pew Poll: Curing an oil addiction (Feb 7)


Tags: Geopolitics & Military