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I guess it really is about the oil…
I’m just about to haul off to bed when I read this little tidbit on drudge:
Iran's economy minister, Davoud Danesh-Jafari, said the country's position as the world's fourth-largest oil producer meant such action would have grave consequences….
Snip.
…Any possible sanctions from the west could possibly, by disturbing Iran's political and economic situation, raise oil prices beyond levels the west expects," he told Iranian state radio.
Mr Danesh-Jafari's warning added weight to veiled threats by Iran's president on Saturday. Iran had a "cheap means" of achieving its nuclear "rights", Mr Ahmadinejad said, adding: "You [the west] need us more than we need you. All of you today need the Iranian nation."
Well, that certainly gets your attention, now doesn’t it! This is like reading in the summer 1941 that the Japanese Navy is meeting in secret to discuss “options for retaliation against the Embargo”. You just know that this isn’t going to end well even if you don’t know the specifics of what is to come.
This would be bad enough by itself, but then I remembered something else. I remembered this odd little picture from November:
(Hugo chavez and Ahmadinejad in November commemorating a Statue to Simon Bolivar)
For the record, Iran is 4th in world oil supplies. Venezuela is 5th.
Venezuela and Iran are now close allies, in both name and action. Any action we take against Iran will now very likely cause a reaction by Venezuela in the form of “boycott”. Venezuela and Iran have now decided to use the time honored tool of “trade war” to influence the world and its policies.
There are a lot of possible outcomes to this, but this is not going to end well no matter how it goes.
When it comes to dealing with Iran there are a lot of people gassing about that the “Israelis will take care of it” assuming that they can take out the Iranian nuclear facilities ala the Iraqi Osirik operation in the 1980s. Well maybe they can and maybe they can't, but I wish to counsel all of you that the results of that action are not going to be without consequences. If you remember back to the 1970’s the Arab world decided that the only way Israel could have won the Yom Kippur war was that the US intervened on the side of Israel. The result was the Arab oil embargo nearly pushed the US and World economies into an actual full on depression. What actually did occur was a deep recession and the rise of an ugly economic species called the “stagflation”. This was something that lasted nearly 10 years but still causes reverberations in world markets even today. As someone who was around back then, I can tell you that it was not pretty and it is not something I want to ever see again. Those of you who think that we had a bad economy over the past three years are in for a real shock when you see what a full out oil embargo can do to an economy.
But here’s the real kicker in this story, thanks to the incredibly stupid policies of the environmentalists who have done everything they can to ensure that we don’t have enough domestic oil production or refineries as well as our own personal desires for cars and trucks that are far larger than anything we drove in the 1970s, we now use even more Arab oil than we did before. Am I exaggerating the impact? Well Ok, last years Hurricanes took out only 5% of our production and look what happened. Today we look at $2.10 a gallon as cheap. Now imagine the impact of a 45% reduction in oil. can you say $5.00 a gallon? maybe $7.50?
It's time to dust off that moped in the back of the garage kids, daddy’s gonna have to park the Hummer for awhile...
Park a hummer here or there, stop buying this or that, and guess what you got? that's right kids, a recession. And if it drags on awhile, you get a full on depression.
Now if Israel were to step in and “take care of Iran” its entirely likely that Kuwait, the UAE, Saudi Arabia and yes, Venezuela would all take part in a boycott of the same sort that occurred in the 1970’s against the United States. There is no free lunch for us to have “Israel do the deed”, so lets stop all that speculation as it’s really a non starter to begin with. It doesn’t make the situation any better and in many ways, it makes it worse. I’m also very sure that Israel has at its disposal one or two of its own discreet ballistic submarines with nuclear tipped missiles on which they can guarantee their security, whether or not Iran gets a nuclear weapon, so they are covered no matter what the world does. Israelis are not stupid; they know damn well what happens when you depend on "the kindness of strangers”.
Unlike the oil embargo of the past, today we have two of the oil producing countries actively working to “overthrow the US hegemony”. One is working 24 hours a day to build an atomic bomb behind which they can continue their repressive government without fear of reprisal from the West. The other is working 24 hours a day to create a Marxist Leninist Socialist Tyranny in Latin America so as to challenge the United States.
We can’t hit Iran without Venezuela going into play, and vice versa. Its like OPEC with a big chip on its shoulder.
Now if you think that the threat of the possibility of an embargo is aimed at the US alone, think again. This threat is not necessarily aimed just at the US, its also aimed at Europe. The US will certainly suffer as the result of an embargo, but to Europe it will be a catastrophe.
Recently we watched Russia try the same sort of thing with the Ukraine. While Russia’s use of GAZPROM was aimed at trying to change Ukrainian policies it had a horrible effect on European markets. In a similar way, this is what Iran is trying with the Europeans now, which is to put it in the vernacular of the streets “ do what we say and no one gets hurt”.
Once governments begin to use the trade of strategic materials as a way to influence government policy, you are already 2/3’s of the way into a real live shooting war whether you want it or not. This is something we’ve tried ourselves back when we decided to tell the Japanese that they couldn’t have any of our oil so long as they were going to exterminate the Chinese. 6 Months later, the Japanese destroyed Pearl Harbor, invaded the Philippines, Indonesia and most of the South Pacific. We didn’t start the war, but we did light the fuse. Iran it seems, has just lit the fuse.
The problem is this. Let’s say you decide to go all leftist hippie and give into the Iranian demands this time rather than do the "Bush thing" and use force. Let’s say you decide not to do anything about Iran because, what the hell, half a dozen other countries have the bomb what’s one more here or there. I mean why shouldn’t a country who’s government not only doesn’t believe that the holocaust didn’t happen, but even if it did, the Germans should’ve finished what they started. Nice fellahs, the mullahs…
What happens next time they want something? And of course, there is always a “next time” as Prime Minister Chamberlain can certainly attest. What happens when Iran comes out and says; “ We think the Shiite portion of Iraq is really part of “Magna Persia” (…ahem - and so do you, if you get my drift France and Germany, and you too Belgium). Or “The Persian Gulf really is the Persian Gulf and you need our permission to enter and leave, and permission is granted on a paying basis”, or how about this “ Anyone who does business with Israel, gets no oil from us”. Where do you end up drawing the line after you’ve given into something like ‘ oh sure, go right ahead and build an atomic bomb, you holocaust denying 9th century throwbacks..”.
See, once you give in to “one little thing”, you can’t stop. Once you decide to give in to their demands, once you show them that it works, they will use it every time. There’s only one way to stop being extorted, and that’s to stop paying the extortionists.
Once they have ”the bomb” and the control of a large amount of the worlds Oil, just who is going to say no to them? Once they have the means, motive and opportunity to kill all of us, what’s to stop them from doing just that?
Back in the 90’s, the world went to war with Iraq because Saddam took it upon himself to threaten the worlds oil supplies by taking by force the little Emirate of Kuwait and directly threatening the Kingdom of Saudi Arabia. The question we have to worry about today is will the world react in the same way once they understand that the threat that has now been aimed at us ( and them!) by Iran and Venezuela is every bit as bad if not worse than the threat by Iraq to the world in the 90’s.
Now, for those of you who still aren’t on board for the Iraq Theatre of Operations in the War on Terror, try to imagine what might have been had Iraq fallen into the hands of Al-Qaeda, who working in collusion with Iran had conspired to control not just two countries, but three of the worlds biggest oil suppliers.
Things are about to get very interesting.
I guess it really was about the oil after all. Because in this case, the Iranians have made clear their expressed desire to to get their own WMD's and no one seems to care or notice very much. But maybe they will care about the destruction of their economies by a country that admires Nazi Germany and hopes to be the next best thing.
Posted @ January 16, 2006 02:03 AM | Current Affairs
Interesting...I have two observations/questions:
1) Iran has to import about 40% refined oil; wouldn't an increase in price affect it as well?
2) Opec/Oil producing nations know that there is an invisible limit to how much they can push it or the conversion to alternative energy sources/locations will happen quicker than they'd like and they'll end up with a fisful of sand. The technology is there...the last thing they want is to provide us with the political will, surely?
All the best,
Marlow
Posted by: Captain Marlow at January 16, 2006 05:48 AM
I agree with your assessment of the situation.
However the USA will not be able to solve this problem. The USA is much to fearful to show any real commitment to the words they speak.
Does the only nation in the world which has ever used nuclear WMD against the population of another country have any moral high ground to stand on when it is telling others that they may not have them?
Who is going to listen to the nation with uses terrorism as it main weapon and was even convicted for it by an international court?
Who is going to believe a nation which supported the apartheid in South-Africa and once labeled the ANC as one of the most dangerous terrorist organisations in the world?
Who is going to trust a nation which clearly believes only in "might makes right"?
How many resolutions would the USA have violated if it had no veto? What does that say about it position on the world stage?
When is the USA going to demonstrate that they are prepared to walk the path which they asks others to walk? When is the USA going to give up their WMD? When is the USA going to give up their veto in the UN?
Posted by: gmlk at January 16, 2006 07:59 AM
Iran is doing its passive-aggressive posturing to influence Europe, Russia & China. The real power in the Persian Gulf is the U.S. Navy, which has the ability to choke off oil exports from any nation, especially Iran. Since Iran has invaded U.S. soverign territory (the embassy in Tehran), we have a legal casus belli. An effective naval blockade(our own act of war), by taking oil tankers trading with Iran as prizes, would call their bluff. The U.S. Navy would capture the tankers and have the ships condemned in an admiralty prize court. The oil would be sold to the highest bidder. The U.S. Navy would receive the proceeds. This overcomes the deficiencies of the U.N. Oil-for-Food program used against Iraq. It puts all the benefits of Iranian oil exports in American pockets. The United States uses its naval might to tell Iran "do as we say and no one gets hurt". Without oil exports, Iran is a barren desert. And no nation can militarily break the blockade, or factually complain that the process does not respect international (Admiralty)law.
Posted by: Machias Privateer at January 16, 2006 08:00 AM
I agree with you for the most part, and I appreciate your insight. However, I noticed you used the phrase "Bush thing" to describe action against Iran versus doing nothing.
Recall that Iran was very much an up-and-coming threat in 2003, moreso than Iraq, which was seriously weakened from sanctions/strikes and unable to develop WMDs without extensive rebuilding. True, at the time Iran was obeying the UN and had their facilities under lock and supervision, but in any case their facilities were intact. Obviously, they possessed the capability to start them up at any time and develop WMDs at a pace Saddam could only dream of.
Perhaps Bush believed that creating a beacon for Democracy in Iraq would prevent Iran from ever taking this step. However, believing doesn't make it so, and mangling the rebuilding of Iraq surely didn't help. In some respects, Bush's actions against Iraq may have provoked Iran to break the locks, not only to protect themselves but out of a lessened fear of reprisal, since our military is already stretched thin in Iraq and Bush set a precedent of ignoring the UN security council.
So in conclusion, I have to point out: if we were to do the "Bush thing" today, we would have to ignore more pressing threats such as Iran, instead attack Uzbekistan, Liechtenstein, or some other country which has no prospect of threatening us in the forseeable future, and then mis-manage the rebuilding process. That way we will find ourselves between an even bigger rock and an even harder place, where more countries are allied against us, threatening us with oil and nuclear weapons, publicly mocking us for attacking a non-threatening country--which we are now struggling to rebuild--in the first place.
Sure Presidents and other public servants are human who don't always handle things correctly, but that doesn't make it any easier to deal with the consequences now.
I propose we don't do the "Bush thing" and instead do something actually effective: get somebody to hire somebody to destroy Iran's nuclear facilities. Maybe a Venezuelan? Not very ethical, I know, but neither is war, and at least it's a suggestion.
I'll be waiting for the emails claiming I'm unpatriotic or am not supporting the troops. Bring 'em on.
Posted by: Josh at January 16, 2006 09:50 AM
I doubt that there was or is anything that we could have done that would have stopped Iran from taking the path they are on. They have been actively at war with us since 1979. In my post today, I wrote that the psychology of Ahmadinejad and the ruling Mullahs that are behind him, makes war unavoidable. Briefly, their version of Islam requires expansion of the caliphate by the proper Muslims (Iranian Shi'ism) or an Apocalyse to usher in the 12th Imam. They have no trouble with the idea of either killing the infidels or blowing themselves up in order to kill the infidels. Once they have a few bombs it woudl only be a matter of time.
Posted by: ShrinkWrapped at January 16, 2006 01:54 PM
The scenario I envision is more along the lines of an internecine cold war between the Shi'a and Sunni factions of Islam.
Already, Egypt has declared (diplomatically) that it would rather that Iran not have Da Bomb. I would have to imagine that the remainder of the rump states of the Southern Med (who typically follow Egypt's lead) will join in.
The very big, very old, very rich dog in the region that hasn't barked yet is the KSA. How do you think Riyadh would feel about Iran trying to re-establish Persian pre-eminence in the region? And how will the PRC factor into this, if at all?
I hesitate to ever (EVER!) say that Pat Robertson was right, but assassinating Hugo Chavez back when the Venezuelan coup was going down probably would have been geopolitically a good move for the U.S. Now we have Bolivarista heads of state in Ecuador and Chile to contend with thanks to the Brothers Marx (Hugo and Fidel).
Bleach.
Posted by: JD at January 16, 2006 09:55 PM
Dear GMLK -
You state openly that the US is in no position to "solve" the Iranian crises because it lacks the moral authority to do so. In this, you pose a series of charges against the US to show it is uniquely perfidious and thus unworthy:
"Does the only nation in the world which has ever used nuclear WMD against the population of another country have any moral high ground to stand on when it is telling others that they may not have them?"
By stripping all context we are left with a pretty stark choice, aren't we? The US is uniquely evil because it is the only nation to use nuclear weapons! Of course, the US was itself faced with a pretty stark choice in 1945, wasn't it? Nuclear weapons were used by a nation exhausted by war and who were not willing to give up 100s of thousands more of its young men in an effort to subdue a vicious aggressor nation. What responsibility did we have to attempt a 'soft landing' for the Japanese while still at war? Was it not enough that we offered an astonishingly humane and productive post-war occupation for them? Given mankind's history of atrocities after victory, how can you possibly fail to see why the world should indeed judge the US as having earned the right to judge other nations?
More to the point, how can you fail to see the difference between a Iran's expansionist aggression and America. Iran has no need to develop such weaponry now. America, on the other hand, was a nation literally exhausted and out of better options when it finally committed to the use of these weapons. Do you see no difference between the bully who threatens a club to the head of those who dare oppose his aggressive plans and the man backed into a corner who grabs a stick to beat an aggressor who has already attacked him viciously?
Your remaining rant makes no sense to me at all. A "terrorist nation?" By any honest take, we've been indicted as a "terrorist nation" only by those who oppose the entire modern project of democratic capitalism and who'll smear anyone who pursues it with whatever calumny seems most likely to rend a pound of flesh.
South Africa? Please - not only is it old news, no one in a position of power in America today would dare support a return to South Africa's apartheid. Worse yet, how can you sling this charge against the nation that fought a bloody civil war to end slavery when dozens of African and Islamic states still practice de facto (or even de jure) slavery today?
UN Resolutions? Talk to me when oppressive police states are no longer permitted to sit on the "Human Rights" committees.
Our lack of perfection, my friend, does not excuse others their vicious tyrannies despite your best efforts to blur it all into a single moral equivalence.
Posted by: Wildmonk at January 17, 2006 11:55 AM
I don't have to defend facts which anyone can find in the archives and history lessons.
http://en.wikipedia.org/wiki/Nicaragua_v._United_States
http://en.wikipedia.org/wiki/International_Court_of_Justice
The point I made was that the USA might want to consider a more humble and realistic attitude towards the world. It claims a position of moral authority which it has no right to, unless it practices what it preaches. Which history shows, it does not.
My "rant" was an observation that this is not a level playing field, not a cry for change. I can not imagine that the USA will be prepared to level the playing field. What I do not understand is the incredible amount of fear and paranoia in the USA, and at the same time its total lack of empathy for the position of other
nations. These two facts are maybe related: If the USA could feel any empathy it might not be so fearful?
You're right that human right violators should not be permitted to sit on the human rights committees, but one of the nation who violate human rights is the USA. Nearly any nation does so from time to time, some more then other, it's a natural function of the "nation" concept. We may deny it, but that does not change the facts: The continuous existence of the nation is more valuable then the rights of an individual.
You're also right that one should not blur this in to a single moral equivalence, I did not intend to do so. We have here a complex world of stronger and weaker imperfect nations. Each at a different point of their development. That the weak seek to become strong is only natural, that the strong want to remain stronger is also only natural.
What positive motivation can we give the weak to decide to choose to remain weak? If there is none, then we are in trouble. If the strong use force to keep them weak, this will only fuel the desire to become stronger. This is why the USA will not be able to resolve this.
We tend to define superpower in terms of our ability to destroy.
Real superpower however is the ability to create and protect life. In that sense the only conclusion is that there is no superpower in this world and until there is, these problems will only get worse.
Posted by: gmlk at January 18, 2006 12:07 AM



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