Part Four

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 edition 1992)

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 Russia.

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 producer.


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, was disastrous.

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 terms.

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 was blocked.

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 Sea.

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 Balkans.

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 oilmen:

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 [2004]. 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 [1973] ... 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 developments, everywhere...

Edward Said wrote in Al-Ahram, just after the invasion of Iraq [2003]

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

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