It’s About (hush!)

I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil. (Alan Greenspan)

It’s a remarkable society we live in – there’s no jackboot on our collective necks, yet we don’t dare say what is obvious. Democrats and Republicans represent the extremely narrow spectrum of debate in our society. Step outside of that, and you are marginalized.

We invaded Iraq to take control of its oil. We don’t care if the place is destabilized – in fact, it justifies our presence there. The Democrats are not offering a meaningful alternative to current policy – Hillary Clinton, Barack Obama and John Edwards all refuse to commit to a withdrawal of troops before the end of their mythical first terms.

Jim Holt has written a remarkable article about the subject. It’s called It’s the Oil, and it is in the current issue of London Review of Books. (Holt writes for the New York Times Magazine and the New Yorker, which leads me to wonder why this piece is not published in either of those two places.)

Iraq has 115 billion barrels of known oil reserves. That is more than five times the total in the United States. And, because of its long isolation, it is the least explored of the world’s oil-rich nations. A mere two thousand wells have been drilled across the entire country; in Texas alone there are a million. It has been estimated, by the Council on Foreign Relations, that Iraq may have a further 220 billion barrels of undiscovered oil; another study puts the figure at 300 billion. If these estimates are anywhere close to the mark, US forces are now sitting on one quarter of the world’s oil resources. The value of Iraqi oil, largely light crude with low production costs, would be of the order of $30 trillion at today’s prices. For purposes of comparison, the projected total cost of the US invasion/occupation is around $1 trillion.

Keep in mind that the $30 trillion will benefit the companies that control the oil (minus a small royalty to the Iraqis), while the $1 trillion cost is ponied up by the U.S. taxpayer. They will freely spend any amount of our money for their benefit.

Who will get Iraq’s oil? One of the Bush administration’s ‘benchmarks’ for the Iraqi government is the passage of a law to distribute oil revenues. The draft law that the US has written for the Iraqi congress would cede nearly all the oil to Western companies. The Iraq National Oil Company would retain control of 17 of Iraq’s 80 existing oilfields, leaving the rest – including all yet to be discovered oil – under foreign corporate control for 30 years. ‘

The Bush Administration and the Congress have laid it right at our feet – Iraq, to satisfy our goals, has to turn its oil wealth over to American oil companies. It’s out in the open. Yet no one talks about it.

If Iraq is to be a protectorate, how do we go about managing it for our benefit? It is on this point that the Democratic presidential candidates stumble – they must know what is going on. The U.S., Halliburton and KBR have been busy these past four years constructing fourteen bases, five of which are superbases that can house as many as 100,000 permanent troops. These are self-contained cities. There’s no need for contact with the Iraqis, whom, I presume, will be left to work things out for themselves (so long as they don’t interfere with our objectives). They might cantonize, be subsumed in poverty and hunger, squabble and kill one another – it doesn’t matter. They were never more than an annoyance anyway.

Five self-sufficient ‘super-bases’ are in various stages of completion. All are well away from the urban areas where most casualties have occurred. There has been precious little reporting on these bases in the American press, whose dwindling corps of correspondents in Iraq cannot move around freely because of the dangerous conditions. (It takes a brave reporter to leave the Green Zone without a military escort.) In February last year, the Washington Post reporter Thomas Ricks described one such facility, the Balad Air Base, forty miles north of Baghdad. A piece of (well-fortified) American suburbia in the middle of the Iraqi desert, Balad has fast-food joints, a miniature golf course, a football field, a cinema and distinct neighbourhoods – among them, ‘KBR-land’, named after the Halliburton subsidiary that has done most of the construction work at the base. Although few of the 20,000 American troops stationed there have ever had any contact with an Iraqi, the runway at the base is one of the world’s busiest. ‘We are behind only Heathrow right now,’ an air force commander told Ricks.

The Congress, of course, passed a resolution forbidding permanent bases in Iraq, and in true Orwellian fashion, mere statement of noble intent covers up a whole lot of ignoble plundering. Of course the bases are temporary. They are only meant to last thirty or forty years – long enough to extract the oil wealth out of the country.

Holt closes by reminding us of the China problem:

As a consequence of our trade deficit, around a trillion dollars’ worth of US denominated debt (including $400 billion in US Treasury bonds) is held by China. This gives Beijing enormous leverage over Washington: by offloading big chunks of US debt, China could bring the American economy to its knees. China’s own economy is, according to official figures, expanding at something like 10 per cent a year. Even if the actual figure is closer to 4 or 5 per cent, as some believe, China’s increasing heft poses a threat to US interests. (One fact: China is acquiring new submarines five times faster than the US.) And the main constraint on China’s growth is its access to energy – which, with the US in control of the biggest share of world oil, would largely be at Washington’s sufferance. Thus is the Chinese threat neutralised.

The U.S. right now does not depend on Iraqi oil – we get ours from Canada, Venezuela (another problem, another day), Nigeria and other places. But that might well change down the road. For the present, U.S. objectives are to control the oil, not to consume it. And it’s not just to have a leg up on China – Western Europe and Japan and India are all potential rivals. It’s all of them. We fear everyone.

So take everything the candidates are saying about terrorists and democracy and concern for the Iraqi people, and discount it by, say …. 100%, and instead think of Iraq as a giant prize. If the U.S. did not claim it, someone else might well have. The country was weakened by war and sanctions and bombing under previous administrations, as if the U.S. were deliberately trying to destroy the place. And as soon as he took office, Vice President Cheney held meetings with top oil companies (The Energy Task Force), and successfully kept the agenda secret from us.

I wonder what they were talking about.