excerpted from the book
A Century of War
Anglo-American Oil Politics and
the New World Order
by William Engdahl
Pluto Press, 2004, paperback (original
The aim of Washington's IMF 'market reforms' in the former Soviet
Union was brutally simple: destroy the economic ties that bound
Moscow to each part of the Soviet Union, from Uzbekistan to Kazakhstan,
from Georgia to Azerbaijan, from Estonia to Poland, Bulgaria or
Hungary. Though it was never stated, IMF shock therapy was intended
to create weak, unstable economies on the periphery of Russia,
dependent on Western capital and on dollar inflows for their survival-a
form of neocolonialism.
... In 1992 the IMF demanded a free float
of the Russian ruble as part of its 'market-oriented' reform.
The ruble float led within a year to an increase in consumer prices
of 9,900 per cent, and a collapse in real wages of 84 per cent.
For the first time since 1917, at least during peacetime, the
majority of Russians were plunged into existential poverty. That
was but the start of IMF-style capitalism for the Russians.
Under IMF direction, Washington could
in effect dictate which sector of Russian industry would survive,
which not. The 'world market,' was defined by Washington and IMF
technocrats, trained in the ways of Milton Friedman's free market.
Neither Russian national priority nor the general welfare of the
population would be the criterion.
... Under the IMF, countries like Russia
and Ukraine were told to immediately adopt the U.S. version of
market economy, with no adequate preparation. The results were
predictable and well planned. The goal was not a stable, prosperous
As most Russians soon realized, the effects
of the IMF reform were catastrophic. Instead of the hoped-for
American-style prosperity, two-cars-in-every-garage capitalism,
ordinary Russians were driven into economic misery. Industrial
production fell to half its earlier level as inflation passed
levels of 200 per cent. Average life expectancy for men dropped
to 57 years by 1994, the level of Bangladesh or Egypt.
The West, above all the United States,
clearly wanted a deindustrialized Russia, to permanently break
up the economic structure of the old Soviet Union. A major area
of the global economy, which had been largely closed to the dollar
domain for more than seven decades, was to be brought under its
control. Behind the nice rhetoric of market-oriented reform, the
region was being carved up in much the manner the European powers
had colonized and divided Africa 100 years before.
For Washington's Clinton administration,
it mattered little that the Russian privatization of key state
industrial assets was controlled by a Russian elite, the so-called
oligarchs. The prime point was that Russian industry was tied
for the first time since Lenin to the future of the dollar. The
new oligarchs were 'dollar oligarchs,' and most of their new wealth
came from the export of oil and gas.
Russia and the states of the former Soviet Union [after the 1989
collapse] were being treated like the Congo or Nigeria, as sources
of cheap raw materials, perhaps the largest sources in the world...
Above all, the oil and gas riches of the former Soviet Union came
into view of the large U.S. and British oil multinationals. In
the eyes of the Washington planners, a modern, thriving Russian
industrial economy would only a hindrance to such plundering of
its raw material wealth.
The IMF shock treatment for Russia after
1991 not only reduced the former superpower to a Third World economy.
It also opened up the potential for American and allied oil companies
to control what had been the world's largest oil and natural gas
Yugoslavia Gets Shock Therapy
Well before the Soviet Union was treated to American-made economic
'shock therapy,' the Balkans had been targeted for U.S. intervention.
'he importance of destroying the Yugoslav economic model was a
major reason for Washington's early focus on Yugoslavia. As events
developed into the mid 1990s, the strategic position of Yugoslavia
in regard to the potential oil sources of central Asia became
increasingly important for Washington. Oil and the dollar in effect
played decisive roles in Washington's Balkan politics through
the latter half of the 1990s, though not in the simplistic way
critics in the West suspected.
Well before the fall of the Berlin Wall,
Washington was busy at work in what was then Yugoslavia, working
in tandem with the IMF once again. Balkan nationalism was being
manipulated from the outside to transform the map of Eurasia into
what it had been in the years before the First World War, when
British and other interests, intent on dismantling the Ottoman
Empire and stopping Germany's Baghdad railway dreams, had intervened.
The obvious aim now was to fragment Yugoslavia
into dependent, tiny states, and to open a foothold for NATO and
the United States at the crossroads between western Europe and
central Asia. Oil and
politics were again in the forefront for Washington.
Ironically, with the dismantling of the
Warsaw Pact in the early 1990s, the very reason for the continued
existence of NATO appeared to vanish. What threat could justify
continuation of the 1949 cold war alliance, or a permanent U.S.
military presence across western Europe, let alone a further extension
to the east? Many hoped NATO might be dismantled once it was clear
the Soviet threat had gone. But Washington strategists had begun
to devise a new mission for NATO, even before the collapse of
the Soviet regime.
The new proposed NATO mandate was termed
'NATO out of area deployment,' meaning well beyond the borders
of NATO member states. This new mandate was later coupled, in
1994, with a Washington 'Partnership for Peace/ a scheme to integrate
the military defense of former Warsaw Pact members, stepwise,
into a U.S.-led NATO. Republican Senator Richard Lugar posed the
dilemma facing the U.S.-dominated NATO at the end of the cold
war with the phrase, 'NATO: out of area, or out of business.'
Conveniently, the Balkan wars were to give Washington a much-needed
argument to extend NATO. The process was to last more than a decade.
For over 40 years, Washington had quietly
supported Yugoslavia, and the Tito model of mixed socialism, as
a buffer against the Soviet Union. As Moscow's empire began to
fall apart, Washington had no more use for a buffer-especially
a nationalist buffer which was economically successful, one that
might convince neighboring states in eastern Europe that a middle
way other than IMF shock therapy was possible. The Yugoslav model
had to be dismantled, for this reason alone, in the eyes of top
Washington strategists. The fact that Yugoslavia also lay on a
critical path to the potential oil riches of central Asia merely
added to the argument. Yugoslavia must be brought, kicking and
screaming if need be, into the IMF version of free-market reform.
NATO would secure the deal.
Already in 1988, as it became clear that
the Soviet system was on its last legs, Washington had sent in
advisers to Yugoslavia from a curious, private, non-profit organization
with the high-sounding name, the National Endowment for Democracy,
or NED as it was known in Washington circles. That 'private' organization
began handing out generous doses of dollars in every corner of
Yugoslavia, financing opposition groups, buying up hungry young
journalists with dreams of a new life, and financing trade union
opposition, pro-IMF opposition economists such as the G-17, and
human rights NGOs.
Speaking in Washington in 1998, ten years
later, and one year before NATO began bombing Belgrade, NED director
Paul McCarthy boasted, 'NED was one of the few Western organizations,
along with the Soros Foundation and some European foundations,
to make grants in the Federal Republic of Yugoslavia, and to work
with local NGO's and independent media throughout the country.'
During the cold war, such internal intervention in a foreign country
would have been labeled a CIA destabilization. In Washington newspeak,
it was called, 'the fostering of democracy.' The result, for the
living standard of Serbs, Kosovans, Bosnians, Croats and others,
What ensued in Yugoslavia after 1990 was
understood by only a few insiders for what it was. Washington,
using the NED, George Soros's Open Society Foundation and the
IMF, introduced economic chaos into Yugoslavia as an instrument
of geopolitical policy. In 1989, the IMF demanded that the prime
minister, Ante Markovic, impose structural reform on the economy.
For whatever reasons, he did.
Under the IMF policies, the Yugoslavian
GDP sank in 1990 by 7.5 per cent, and by another 15 per cent in
1991. Industrial production plunged 21 per cent. The IMF demanded
wholesale privatization of state enterprises. The result was the
bankruptcy of more than 1,100 companies by 1990, and more than
20 per cent unemployment. The economic pressure on the various
regions of the country created an explosive cocktail. Predictably,
amid growing economic chaos, each region fought for its own survival,
against its neighbors. Leaving nothing to chance, the IMF ordered
all wages to be frozen at 1989 levels, while inflation rose dramatically,
leading to a fall in real earnings of 41 per cent by the first
six months of 1990. By 1991, inflation was over 140 per cent.
In this situation, the IMF ordered full convertibility of the
dinar and the freeing of interest rates. The IMF explicitly prevented
the Yugoslav government from obtaining credit from its own central
bank, crippling the ability of the central government to finance
social and other programs. This freeze created a de facto economic
secession, well before the formal declaration of secession by
Croatia and Slovenia in June 1991.
In November 1990, under pressure from
the Bush administration, the U.S. Congress passed the Foreign
Operations Appropriations Act. The new U. S. law provided that
any part of Yugoslavia failing to declare independence from Yugoslavia
within six months of the act would lose all U.S. financial support.
The law demanded separate elections, supervised by the U.S. State
Department, in each of the six Yugoslav republics. It also stipulated
that any aid go directly to each republic, and not to the central
Yugoslav government in Belgrade. In short, the Bush administration
demanded the self-dissolution of the Yugoslav Federation. They
were deliberately lighting the fuse to an explosive new series
of Balkan wars.
Using groups such as the Soros Foundation
and NED, Washington financial support was channeled into often
extreme nationalist or former fascist organizations that would
guarantee a dismemberment of Yugoslavia. Reacting to this combination
of IMF shock therapy and direct Washington destabilization, the
Yugoslav president, Serb nationalist Slobodan Milosevic, organized
a new Communist Party in November 1990, dedicated to prevent the
breakup of the federated Yugoslav Republic. The stage was set
for a gruesome series of regional ethnic wars which would last
a decade and result in the deaths of more than 200,000 people.
The economic heat was being turned up
on the tiny but strategic Balkan country, and the Bush administration
was doing the turning. In 1992 Washington imposed a total economic
embargo on Yugoslavia, freezing all trade and plunging the economy
into chaos, with hyperinflation and 70 per cent unemployment as
the result. The Western public, above all in the United States,
was told by' establishment media that the problems were all a
result of a corrupt Belgrade dictatorship. The American media
chose rarely if ever to mention the provocative Washington actions,
or the IMF policies which were driving events in the Balkans.
In 1995, the Dayton accord brought an
end to the war in Bosnia. This coincided with the point at which
the Clinton administration became convinced of the strategic importance
of Caspian oil, and the extent of EU efforts to secure that oil
for Europe via Balkan pipelines. Washington decided apparently
that peace in the region was needed to develop oil routes from
the Caspian into Europe. But it was to be 'peace' on Washington's
After Dayton, Bosnia, once multiethnic,
was established as a de facto Muslim state, in effect a client
state under control of the IMF and of NATO. The Clinton administration
had largely financed the arming of the Bosnian Muslim army. The
depiction of the war in the international media maximized the
impression of European Union powerlessness to settle a major war
on its borders without America's intervention. Washington's argument
for extending NATO eastward advanced significantly in the process.
Hungary, Poland and the Czech Republic became prospective NATO
partners, something inconceivable just five years earlier.
Soon the Clinton administration went to
work on the next stage of dismantling any nationalist residue
in the Balkans that might have a different agenda for the region
than that of Washington. American and British oil companies scrambled
to exploit the potentially vast oil reserves believed to lie under
the Caspian Sea off Baku, and bordering Kazakhstan in central
Asia. Geologists spoke of a 'new Kuwait or Saudi Arabia' there.
The U.S. government estimated oil reserves could be in excess
of 200 billion barrels-if true, the largest oil discovery in decades.
Zbigniew Brzezinski, a well-paid Washington lobbyist, represented
the interests of BP, the Anglo-American oil giant with a major
stake in the Caspian oil region.
By the mid 1990s, partly through the active lobbying of Brzezinski
and the major U.S. oil companies, the Clinton administration had
begun to recognize the Caspian oil issue as a strategic priority.
In July 1996, Washington created the Southern Balkan Development
Initiative to discuss pipeline cooperation with Bulgaria, Macedonia
and Albania. It backed two Caspian pipeline routes. One would
go from Baku through Georgia to the Turkish port of Ceyhan. In
1997, former Bush secretary of state James Baker wrote an op-ed
in the July 21 New York Times titled 'America's Vital Interest
in the "New Silk Road." Baker, who would later emerge
as a major figure in a later Bush administration, argued that
it 'was in the strategic interests of the United States to build
the strongest possible economic, cultural and political ties to
Georgia/ a country between the Caspian oil and Western markets.
'Caspian oil may eventually be as important to the industrialized
world as Middle East oil is today,' he added. At the time, Baker
was also attorney for the Baku interests of BP-Amoco.
A second pipeline route, AMBO or Albanian
Macedonian Bulgarian Oil Pipeline Corp., backed by the U.S. government
and First Boston Bank, had been on ice for several years. Before
it could move ahead, Washington decided it had to eliminate the
obstacle of the Milosevic regime.
Slobodan Milosevic, the elected Yugoslav
president, a former banker who had once, when it was thought he
might play the IMF game, enjoyed the backing of Washington, became
a new 'Adolf Hitler' in the U.S. media. Numerous accounts from
the region and from impartial outside observers confirmed that
by the mid 1990s, all sides in the destabilized former Yugoslavia
were guilty of atrocities - Bosnian Muslims, Croatian Catholics
and Serb Orthodox Christians. Washington and NATO-scripted media
reports concentrated, however, on only one side: the recalcitrant
Serb president Milosevic. So long as a well-defended enclave remained
in the middle of the Balkans, which rejected IMF 'reform' and
the presence of NATO, the long-term geopolitical agenda of Washington
for the control of the Caspian pipeline routes and central Asia
By early 1999, the Clinton administration
had decided the time was right to change all that. An indignant
Milosevic rejected a U.S. demand at Rambouillet, the infamous
Appendix B, mandating that he allow NATO troops to occupy Kosovo,
and potentially Serbia, 'for humanitarian reasons of preventing
genocide.' Milosevic's predictable rejection was used to justify
war. Washington began a massive bombing campaign, ignoring the
niceties of international law, the UN Charter (and indeed any
involvement at all of the UN in the process), the NATO charter
(which specifies a purely defensive role), the 1975 Helsinki accords,
and even the U.S. constitution (which mandates that only Congress
has the power to declare war). President Clinton cited 'humanitarian'
reasons and the threat of imminent genocide against Kosovo Albanians,
and began a merciless bombing of civilian Serb targets.
Thousands of tons of bombs later, and
after an estimated $40 billion of destruction to the economy and
infrastructure of Serbia, the Pentagon began the construction
of one of the largest U.S. military bases anywhere in the world.
Camp Bond Steel near Gnjilane in southeast Kosovo, a fortress
housing 3,000 soldiers, an airfield and state-of-the-art telecommunications,
gave the United States a commanding and clearly permanent military
presence in the strategic Balkans, within reach of the Caspian
A new series of pipelines through the Balkans could potentially
offer the EU diversity of oil supply and a degree of energy independence
from U.S. and Russian controlled energy sources. In the wake of
the Kosovo war, the United States had preempted such possible
energy independence, imposing NATO and U.S. control over possible
pipeline routes and sources. As Belgrade dug out from the bombing
and rubble of the Kosovo war, the U.S. appeared to be in firm
control over any potential pipeline routes to the EU.
The military control of Eurasia by the
sole superpower had taken a giant step forward by the end of the
Kosovo war. Dollar democracy had marched ahead once more. The
flag of the free market was firmly planted in a destroyed Yugoslavia.
By 2001, Washington was in uncontested military control of the
After leaving Washington in 1992, [Jim] Baker had endowed major
think tank, the Baker Institute, at Houston's Rice University.
The Baker Institute energy group was notable. It included Kenneth
Lay, head of the soon-to-be infamous Enron Corp., and one of Bush's
most generous financial supporters. It included a board member
of Shell, a top executive of BP, and the head of ChevronTexaco.
Oil consultant Matthew Simmons was also in the group, and the
Baker Institute board included the former Kuwaiti oil minister,
Sheikh Saud Nasir al-Sabah.
Sheikh al-Sabah's daughter in a curious
postscript to the first Iraq war, was later identified a the Kuwaiti
woman who had told the U.S. Congress in October 1990 that she
had witnessed Iraqi soldiers taking Kuwaiti babies from their
incubators. Her shocking testimony had been a major factor in
getting U.S. popular support for Operation Desert Storm. That
incident was later exposed as a PR stunt, fabricated by Hill &
Knowlton, a Washington firm close to the Bush administration.
In autumn 1999, at a private London Institute of Petroleum meeting,
Cheney, then CEO of Halliburton, had told leading international
oil executives that the Middle East would become an even more
vital strategic center of needed oil reserves over the coming
decades. In a preview of his 2001 energy report, Cheney told the
by 2010 we will need on the order of
an additional fifty million barrels a day. So where is the oil
going to come from? Governments and the national oil companies
are obviously controlling about ninety percent of the assets.
Oil remains fundamentally a government business.
The figure of 50 million barrels a day
was almost two-thirds of total world oil output then at the time,
a huge volume, equal to more than six times the total oil production
of Saudi Arabia. The fact that Cheney also saw it as a problem
that governments controlled their oil was highly significant,
as Saddam Hussein and other heads of oil states were soon to learn.
Where would the world find six new Saudi Arabias? Cheney answered,
'While many regions of the world offer great oil opportunities,
the Middle East, with two-thirds of the world's oil and the lowest
cost, is still where the prize ultimately lies.
The New American Century
A little-known Washington think tank issued
a policy paper in September 2000, weeks before the U.S. presidential
elections and a year before 9/11. The paper, titled 'Rebuilding
America's Defenses,' was clearly meant to shape the policy of
the next administration. The document had been prepared by an
influential Republican group calling itself the Project for the
New American Century, or PNAC.
Among the members of the PNAC were the
same men who were to shape policy in the coming administration.
The group included Halliburton chief Cheney, Don Rumsfeld and
Paul Wolfowitz, who later became Rumsfeld's deputy defense secretary
and a leading Iraq war hawk. It also included Cheney's later chief
of staff, Lewis Libby, and Karl Rove, who went on to become George
W. Bush's most powerful political strategist. Senior executives,
such as Bruce Jackson of Lockheed Martin, one of the world's biggest
defense firms, Richard Perle, and Florida Governor Jeb Bush, were
involved too. The PNAC chairman was William Kristol, who had built
a hawkish media empire around his Weekly Standard, with the help
of a generous $10 million from London Times publisher Rupert Murdoch.
Given these powerful backers, the PNAC report was worth careful
reading. Few did so before September 11.
That PNAC report began with a simple question:
'Does the United States have the resolve to shape a new century
favorable to American principles and interests?' They declared:
The United States is the world's only
superpower ... At present the United States faces no global rival
... America's grand strategy should aim to preserve and extend
this advantageous position as far into the future as possible.
There are, however, potentially powerful states dissatisfied with
the current situation and eager to change it, if they can ...
The report made it clear that they had
in mind various Eurasian powers, from Europe to the Pacific.
The Project for the New American Century
praised a 1992 strategic white paper that Wolfowitz had written
for Cheney, back when Cheney had been defense secretary during
the first Iraq war, stating, 'The Defense Policy Guidance drafted
in the early months of 1992 provided a blueprint for maintaining
U.S. pre-eminence, precluding the rise of a great power rival
and shaping the international security order in line with American
principles and interests.' Bush ordered that 1992 policy paper
to be buried. It became far too hot after a copy was leaked to
the New York Times in early 1992. It had called for precisely
the form of preemptive wars, to 'preclude' a great power rival,
that George W. Bush made official as the U.S. national security
strategy, the Bush doctrine, in September 2002.
Cheney and company now restated that 1992
imperial agenda for America in the post-cold war era. They declared
that the United States 'must discourage advanced industrial nations
from challenging our leadership, or even aspiring to a larger
regional or global role.'
The PNAC group were not content only to
dominate the earth, proposing that Washington create a 'worldwide
command and control system.' They also called for the creation
of 'U.S. space forces' to dominate space, for total control of
cyberspace, and for the development of biological weapons 'that
can target specific genotypes and may transform biological warfare
from the realm of terror to a politically useful tool.' Biological
warfare as a politically useful tool? Even George Orwell would
have been shocked.
With uncanny prescience, that September
2000 PNAC report went on to identify what later became immortalized
by George W. Bush as the 'Axis of Evil.' It singled out three
regimes-North Korea, Iran and Iraq-as posing a special problem
for the New American Century.
Months before the world, courtesy of CNN,
witnessed the attacks on the World Trade Center and the Pentagon,
or had even heard of Osama bin Laden, Cheney's PNAC had targeted
Saddam Hussein's Iraq for special treatment, stating bluntly that
U.S. policy should be to take direct military control of the Arabian
Gulf. The report declared:
The United States has for decades sought
to play a more permanent role in Gulf regional security. While
the unresolved conflict with Iraq provides the immediate justification,
the need for a substantial American force presence in the Gulf
transcends the issue of the regime of Saddam Hussein.
That sentence, on the 'need for a substantial
American force presence in the Gulf,' was later read and reread
in many quarters around the world, in the months before the bombing
of Baghdad. Iraq was simply a useful excuse for Cheney, Wolfowitz
and others to justify 'the need for a substantial American force
presence in the Gulf ...' There was no talk of Iraqi weapons of
mass destruction, or of its ties to terrorists.
[Studies by Colin] Campbell and [Matthew] Simmons both pointed
to a unique geological formation: a triangle which holds perhaps
65 per cent or more of the world's remaining oil reserves. It
encompasses five countries: Iraq, Iran, Saudi Arabia, Kuwait and
the Emirates, notably, Qatar. The largest of those undeveloped
Middle East oil reserves were reportedly in Iraq. Some U.S. government
studies estimated that Iraq might hold as much as 432 billion
barrels of unexplored oil resources, far more than Saudi Arabia.
president of ExxonMobil Exploration Company Jon Thompson in 2003
We estimate world oil and gas production
from existing fields is declining at an average rate of 4-6 per
cent a year. To meet projected demand in 2015, the industry will
have to add about 100 million oil-equivalent barrels a day of
new production. That's equal to about 80 per cent of today's production
level. In other words, we will need to find, develop and produce
a volume of new oil and gas that is equal to eight out of every
10 barrels being produced today.
As [George W.] Bush prepared his bid to secure reelection, a definite
pattern to U.S. military policy and to U.S. energy policy was
clear. The conclusion was inescapable. U.S. foreign and military
policy was now about controlling every major existing and potential
oil source and transport route on earth. Such control would be
unprecedented. One superpower, the United States, would be in
a position to decide who gets how much energy and at what price.
Michael Klare, 2003
President Bush has given top priority
to the enhancement of America's power projection capabilities,
while at the same time endorsing an energy strategy that entails
increased U.S. dependence on oil derived from areas of recurring
crisis and conflict ... One arm of this strategy is aimed at securing
more oil from the rest of the world; the other is aimed at enhancing
America's capacity to intervene in exactly such locales ... They
have merged into a single, integrated design for American world
dominance in the 21st Century.
Mikhail Saakashvili a 36-year-old Z U.S.-educated lawyer, took
over the presidency of Georgia in a rose revolution . The
latter was supported by Washington and the Soros Foundation...
In early 2003, while all eyes were on Iraq, the Pentagon prepared
a long-term military basing agreement with two tiny Pacific islands,
Sao Tome and Principe, which conveniently were within striking
distance of the strategic west African oilfields stretching from
Morocco to Nigeria, Equatorial Guinea and Angola. George Bush
made a highly unusual tour of west Africa to coincide with the
deal. Some analysts in Washington estimated that up to 25 per
cent of U.S. oil needs would soon come from west Africa. They
called the Gulf of Guinea an area of 'vital interest' to the United
States. The Cheney energy policy report had said that west Africa
was 'expected to be one of fastest-growing sources of oil and
gas for the American market.' Behind the scenes, the United States
had been pushing the French from their traditional role in various
African oil regions.
Libya was also falling into the U. S.
orbit. In January 2004, Colonel Qaddafi announced his rejection
of terror and opening up of Libya to foreign oil investment, in
return for a U.S. lifting of sanctions. Remarking on his new embrace
of Washington, Qaddafi noted, 'It is the era of globalization,
and there are many new factors which are mapping out the world.'
Libya still held considerable oil, and Washington wanted to get
its hands on it. Libya had begun signing major deals with Japanese,
Italian, French and other foreign companies not bound by the U.S.
sanctions. It had already signed with China to build oil and gas
pipelines. Now that would all change. American oil companies were
invited back. Qaddafi had become a survivalist.
In Sudan, the government in Khartoum signed
an agreement in January 2004 to share the oil wealth of the rebel
south, ending two decades of civil war. Washington was behind
the deal. Sudan had been working with Chinese and European oil
companies, and U.S. firms were excluded by Washington sanctions
policy. Sudan had significant oil reserves and Washington decided
the time was ripe get them too.
Colombian oil and that of neighboring Venezuela were also subject
to growing U.S. military presence. The Bush administration announced
plans to spend $98 million to provide military training and support
in Colombia. This was not intended to stop the flood of cocaine
into the United States. It was to resist the guerillas of the
FARC and ELN, who threatened the large Occidental Petroleum pipeline
there. Colombia had become the seventh-largest oil supplier to
the United States. And when the Venezuelan president, Hugo Chavez,
tried to take more direct policy control of the Venezuelan state
oil company, the Bush administration attempted a covert coup.
(U.S. oil imports from Venezuela, Colombia and Ecuador exceeded
those from the entire Middle East.)
By the end of his first term in office, George W. Bush, the neophyte
in foreign affairs, had presided over the most dramatic extension
of American military power in its history. U.S. military bases
allowed it to control the strategic energy routes of all Eurasia
as never before. It could control future energy relations with
Japan, China, East Asia, India and Russia, as well as the European
Union. Belgian author Michel Collon put it bluntly: If you want
to rule the world you need to control oil. All the oil. Anywhere.
That was clearly just what Washington was doing.
When an energy-dependent Japan had tried
to sign a long-term deal to develop a major oilfield in Iran in
August 2003, after the Iraq war, Washington stopped Japan from
signing, citing Iran's nuclear program as reason. Tokyo got the
message. By October, they were frantically trying to outbid China
for Russian oil from the Yukos company, at a time when the Russian
company was talking with George H.W. Bush about selling a dominant
share of Yukos to ChevronTexaco. The Washington oil radar was
monitoring everyone, anywhere.
In the wake of the U.S. occupation of
Iraq, it became clear that the United States was determined, one
way or another, to lock up every major source of oil and natural
gas it could. Small wonder that many outside the United States
began to question the motives of the American president and his
declared mission of spreading freedom and democracy. His proposal
to advance democracy in the Middle East through doubled funding
for the National Endowment for Democracy was hardly reassurance.
Anatol Lieven analyzed the U.S. push for
war just before the march on Baghdad. Lieven, of the Carnegie
Endowment for International Peace in Washington, remarked:
The basic and generally agreed plan is
unilateral world domination through absolute military superiority,
and this has been consistently advocated and worked on by the
group of intellectuals close to Dick Cheney and Richard Perle
since the collapse of the Soviet Union in the early 1990's.
Lieven tied the agenda of the Cheney circle
directly to the strategic issue of oil: 'For the group around
Cheney, the single most important consideration is guaranteed
and unrestricted access to cheap oil, controlled as far as possible
at its source.
The 1973 Bilderberg policy, set out in Saltsjobaden, Sweden, had
been to raise oil prices high enough to make the new discoveries
in the North Sea, Alaska and other nonOPEC regions profitable.
That first oil shock managed to buy some time for the dollar system.
In the 1970s, powerful groups such as
the Bilderberg and the Trilateral Commission had been able to
postpone the impact of that first oil shock on Europe, Japan,
and above all the United States. They did this by imposing the
IMF system on the aspirations of most of the emerging world, crushing
any nationalist movement for economic development and self-sufficiency.
They called this 'sustainable' growth.
It sustained the rich nations of the industrial world and the
dollar system for more than three decades, by enforcing 'limits
to growth' on the rest of the world. The industrial world was
able to live some three decades more under the illusion of abundant,
cheap oil supporting a living standard unprecedented in history.
That illusion, however, had been bought at the cost of the well-being
of the populations of the once-developing world, from Africa to
Latin America to Asia. Only through stifling ( the natural aspirations
of most of the rest of the world for economic stability and growth
could a small handful of nations, led by the United States, enjoy
that illusion of prosperity for a little longer.
The IMF played a central role in making
that illusion possible. By artificially depressing the industrialization
of most of the planet, Washington could depress the global demand
for oil, and allow U.S. imports of cheap oil to continue to fuel
their artificial prosperity. American oil output had peaked in
the early 1970s. The American way of life depended on an ever
rising import of foreign oil.
By the beginning of the new century, even
that illusion of abundant, cheap oil was no longer sustainable.
The IMF treatment, or its equivalent, was turned on the populations
of the industrial world for the first time. As an absolute world
oil peak approached, the United States adopted unilateral measures
to preserve its power, from rejecting the Kyoto protocol, to refusing
to accept the jurisdiction of the International Court of justice
over its soldiers and officials, to the invading of Iraq and beyond.
Thirty years after the first oil shock
 ... Washington and the major British and American oil giants
no longer had the luxury of counting on regimes with state-owned
oil companies to do their bidding. Direct U.S. and British control
of world oil and gas assets was the agenda. They preferred to
call it promoting democracy in the Middle East the evidence pointed
to an imminent world peak, an absolute peak, in oil resources,
and Washington was leaving little to chance. If 1973 had been
a warning call, it was increasingly clear that 2003 was not. It
was for real.
At the start of the new millennium, the
United Stated held a near monopoly on military technology and
might. It commanded the world's reserve currency and with it was
able to control the assets of much of the industrial world. Following
the occupation of the oil fields of Iraq, one power, the United
States, now commanded a near monopoly on future energy resources.
The Pentagon had a term for it-'full spectrum dominance.' It meant
that the United States should control military, economic and political
Edward Said wrote in Al-Ahram, just after the invasion of Iraq
Every single empire, in its official discourse,
has said that it is not like all the others, that its circumstances
are special, that it has a mission to enlighten, civilize, bring
order and democracy, and that it uses force only as a last resort.
A Century of War