Swans Commentary » swans.com April 10, 2006  



Creative Destruction: From Iraq To Iran
Why the Coming Attack on Iran


by Gilles d'Aymery





(Swans - April 10, 2006)  Very few observers have noticed that the fix is in and that the U.S. is readying itself to bomb Iran. Scott Ritter mentioned the fix in his article, "The Art of War for the anti-war movement" (Alternet, March 31, 2006). Writes Ritter: "President Bush recently re-affirmed his embrace of the principles of pre-emptive war when he signed off on the 2006 version of the National Security Strategy of the United States, which highlights Iran as a threat worthy of confrontation." Jorge Hirsch, a professor of physics at the University of California San Diego, has been covering the issue in great, and alarming, detail since September 2005 in the pages of Antiwar.com. His grim prognostic, "War Against Iran, April 2006," is that the attack will take place this month, unannounced until ex post facto. His timing may prove incorrect -- we will know within the next 20 days -- but it's only a matter of time: the U.S. will launch another illegal and deadly aggression on a country that has not attacked, or even threatened to attack, anybody -- not the U.S., not Israel*, not Europe, not its neighbors. The question, like with Iraq, always left unanswered, is what makes the U.S. so determined to create mayhem? The answer has much to do with the status of the dollar and the competitive forces at play. The U.S., a ghost of its former self, economically and structurally in decline, must, out of sheer survival, hit at the competition. That competition has nothing to do with Afghanistan, Iraq, or Iran...or even Yugoslavia -- pawns in a bigger game or small fishes in the whirlwind waters of our times. It is about Europe and Asia. Higher oil prices, denominated in US dollars, far from being an impediment to US economy and interests, weaken the competition, and reinforce the comparative advantages of the US behemoth. A country that is by all realistic measurements broke, is going for broke.

The fix is unmistakable

The chattering classes, from the New York Times to the Washington Post and the Wall Street Journal, as well as influential rags like the Weekly Standard, and myriad think tanks, have been beating the drums of war against Iran for months on end. The networks and cable news and radio have added to the script in unison. Iran is in violation of the Nuclear Non-Proliferation Treaty (actually, it's the U.S. that undeniably is). Iran poses a threat to the U.S. (actually, it is the U.S. that is posing an undeniable threat to Iran). Iran wants nuclear weapons (an utterly unproven allegation, while the U.S. is a nuclear power that has used its arsenal once, while it needed not at all to do so, and is developing a new-age, life-ending nuclear arsenal). Iran is developing biological weapons and wants to spread the H5N1 virus (or malaria, or smallpox, or whatever) all over America and her friends and allies (meaning Israel, the useful and favorite punching bag of the anti-Israel crowd). Iran launched a mini satellite with Russian help, which, according to William Broad and David Sanger (New York Times, April 4, 2006), is another proof of Iran's nuclear ambitions. Iran is meddling in the affairs of Iraq (as if the U.S. were not). The litany goes on.

It's the same PR strategy that has been honed time and again, from the first Gulf War to the Yugoslav Wars and Gulf War II (among many other foreign adventures). It's working again quite dandily with Iran. The U.S. got its new Hitler in the person of Iran's president, Mahmoud Ahmadinejad. The polls show that the American people, in sheep-like fashion, believe that Iran is the biggest danger faced by the nation. WMD, biological weapons, nuclear program... It's déjá vu all over again.

So the fix is in, notwithstanding the wishful thinking of Scott McConnell at the American Conservative, or the laments of Robert Parry at Consortium News who raises hell about the U.S. holding up in ridicule the Nuremberg principles (Parry should investigate the last time the U.S. has ever upheld a principle beside raw power and greed). Right or Left, these hoodwinked second-tier commentators stick to the goodness of some mythical America. As Ron Paul, the US Representative from Texas, said on April 5 in an otherwise thoughtful speech: "In a way, it's amazing there's not a lot more outrage expressed by the American people. There's plenty of complaining, but no outrage over policies that are not part of our American tradition. War based on false pretenses, 20,000 American casualties, torture policies, thousands jailed without due process, illegal surveillance of citizens, warrantless searches, and yet no outrage."

No outrage, because it is an American tradition to annihilate Indians, enslave Blacks, wage racist wars from The Philippines to Vietnam and beyond, all the way to Iraq. "War based on false pretenses"? What about the Mexican War, the Spanish War, and some 200+ military interventions, down to Yugoslavia, Iraq, and now Iran? "Torture"? Rep. Ron Paul should consult a few history books on Vietnam. "American casualties" have never been a problem for American elites -- they do not send their sons and daughters into conflicts, and the famed American people in their arch-machismo are much too happy to oblige. "People jailed without due process"? Ask Japanese Americans. "Illegal surveillance of citizens, warrantless searches"? Nothing that has not been done during McCarthyism in the 1950s or during the Vietnam War or the decapitation of the American Left between 1880 and 1920. There is no outrage on the part of the American people because there is nothing in what Ron Paul rants about that is not normal American procedure. Sad? Yes. Realistic? Yes, too...sadly. Even American "Progressives" welcome military intervention. "Just because Bush made a mess of Iraq doesn't mean we should abandon the use of regime change for humanitarian purposes," writes G. Pascal Zachary, Contributing Editor of In These Times in "The Good Guy's Guide to Overthrowing Governments" (Alternet, April 6, 2006).

The strategy is getting clearer

Other observers consider that the U.S. is acting like a bully out of fundamental weakness that was revealed by 9-11. Prof. Michael Neumann belongs to this school of thought. He wrote just before the Iraq invasion:

Think of America as a strutting street thug, a high-school dropout. Someone sneaks up on him, beats the crap out of him, and walks away. Our thug has lost respect. He swears up and down the block, to all his friends and enemies, that he knows exactly who did this -- call them, say, the Mullah Omar and Osama Bin Laden -- and he will get them, good. He gets a few buddies together and strides into the hostile home turf of his enemies. He yells a lot, he talks trash, he breaks down a few doors, stomps through some houses, beats on a few scrawny punks and a few bystanders ... but no Mullah Omar or Bin Laden.

People are starting to laugh at him, and not only behind his back. Bin Laden is taunting him. He has lost respect. Since he has always claimed to be the toughest of the tough, and made many enemies, if he doesn't regain it, he may get worse than a beating. His survival may be at stake. Respect is everything: he cannot fight off all his enemies if they lose their fear of him. So he has to do serious damage to someone, anyone -- it's not the same as getting Bin Laden, but it's the best he can do. How about this Saddam Hussein guy?

("A Plea for Hysteria - The Secret's Out: the US is Weak," CounterPunch, February 28, 2003.)

The bully theory is an attractive one, but it obfuscates the fact that this bullying behavior on the part of the U.S. largely predates 9-11. It also reinforces the idea that the US elites are dimwits who are acting irrationally, led by an incompetent administration and a less than thoughtful president.

Undoubtedly, the U.S. faces serious weaknesses:

Its manufacturing capacity, with rare exceptions, is all but wiped out (purposefully, one should add).

Its technological prowess, except in the military realm, has been overtaken by competitors, as Clyde Prestowitz, the President of the Economic Strategy Institute, outlines in a recent report, "America's Technology Future at Risk."

Its education system is also lagging far behind its Asian and European competitors through the widespread lack of qualified teachers (see the final report of The Teaching Commission) and the disrepair of school buildings, the latter requiring at least $125 billion to bring them to a minimum standard of structural safety, according to the Center for Strategic and International Studies Commission on Public Infrastructure (an issue that this author reviewed as far back as September 1996, in "Shame on us").

The same Commission reports on the advanced state of America's decaying infrastructure (bridges, tunnels, roads, railways, airports, levees, dams, clean water systems, etc.) and cites the Infrastructure Report Card 2005 from the American Society of Civil Engineers (ASCE) that estimates the cost of repairs at $1.6 trillion, without even taking into account Katrina (here again, we covered this issue in 2003: see "In The Grip Of A Permanent War Economy," by late Professor Seymour Melman, Swans, March 17, 2003. At that time, the ASCE estimated the cost of repairs at $1.3 trillion.)

Its health care system is the most expensive and least efficient by far of all the industrialized countries.

Its R&D is moving to China and India.

Its national debt is about $8.4 trillion and rising fast.

Its twin deficits reached $1.044 trillion in 2005. The trade deficit alone was $726 billion, or 5.6% of US GDP (for comparison the trade deficits were 0.6% and 4% of GDP in 1992 and 2002, respectively. If the trend continues the trade deficit could reach 16.6% of GDP by 2012.)

American personal savings rate dipped into negative territory in 2005 at minus 0.5%, the first time since the Great Depression (1932: -0.9%; 1933: -1.5%). If the housing bubble bursts, trillions of dollars in assets could be shaved off the economy.

These are just a few of the not-so-rosy trends taking place in the U.S. It's an economy that is increasingly based on militarism, services, consumerism, and housing (and gambling). But the military-industrial complex, the oil & gas, pharmaceutical and biotech, entertainment, and banking industries are forces to reckon with. They are worldwide behemoths. ExxonMobil, the world's largest publicly traded company which has just topped the Fortune 500 past Wal*Mart, had revenues of $371 billion in 2005 and a record profit of $36 billion (in comparison, Israel's GDP was an estimated $121 billion). Chevron, ConocoPhillips, Marathon, Murphy, Sunoco, Valero, all part of the 50 largest US corporations, also had record profits in 2005. From a financial perspective they have greatly benefited from the Iraq War and the minor oil disruptions.

It is worth noting at this point that the higher the price of oil, the higher the profits that have incurred, without disrupting much the US economy yet burdening those countries that are much more dependent on oil imports (Japan, EU). Prior to the Iraq invasion, China, Russia, France and Germany were poised to benefit greatly from huge oil contracts with the Iraqi government. By 2000, with the sanction regime fizzling, Iraq had concluded or was in discussions with some 40 companies from 30 countries but not one company from the U.S. or the U.K. At the same time, in 2000, Iraq had decided to switch to denominate its oil sales in euros (pegged to the US dollar of course, but still, a possibility of the beginning of a currency threat to the domination of the US dollar in international trade and financing of US deficits) with the potential of having a ripple effect on other oil producing countries, which occurred when Iran began selling its oil either in euros or in yen. By March 2003, the U.S. and the U.K. invaded Iraq. By June 2003, Iraqi oil was once again denominated in US dollars.

Anglo-American oil interests have also been shut out of the Iran market due to US policies against the Iranian regime. Furthermore, Iran has been working on the creation of an oil bourse (oil exchange) pegged entirely on the euro. Its creation would inexorably cause harm to the US dollar supremacy in world trade. Like a breach in the New Orleans levee, the entire international monetary system could unravel to the detriment of US national and strategic interests.

The U.S. cannot, and will not, let it happen. Commentators have been worrying that should the U.S. attack Iran, and Iran retaliate by, perhaps, shutting down the Strait of Hormuz, huge oil disruptions and price hikes will occur, but they miss the point wholeheartedly. The beauty of the cold and highly rational US calculation is that if such retaliation takes place, it's Europe, Japan, and China that will bear the brunt of the disruptions, and the price hikes will be denominated in US dollars.

The U.S. imports close to 60% of its oil requirements but only 10% comes from the Middle East. The vast majority comes from Canada, Mexico, Venezuela, and Western Africa. The disruptions, if they unfold, will affect to a much larger extent its major competitors who are far more dependent on Middle East oil & gas. Moreover, they will be compelled to keep using the US currency that in turn will be recycled in the U.S. Should President Chávez of Venezuela take advantage of the situation, the country will be immediately invaded.

The destruction of Iraq and its descent into sectarian violence, far from a confirmation of US incompetence, has been carefully planned on a bipartisan basis (notwithstanding domestic squabbles between the two parties in order to better manage public opinion) to achieve those results. Iraq is back into the US dollar hegemony, its resources controlled by the invaders, the main US competitors are licking their wounds without having any sound counter-policy yet to resist the US assault, and Iran is next on the chessboard.

Can the Iran War be avoided? Possibly. Iran would have to quietly agree to abandon its oil bourse project and rejoin the fold of the US dollar supremacy -- but one can sense that the U.S. is far too advanced to now stop in the midst of this creative destruction.


*  Whatever obnoxious comments Ahmadinejad made in regard to Israel, the Jewish people, or the Holocaust, he did not say that he wanted Iran to wipe out Israel from the map; and even if that were his secret wish, he does not control the Iranian army. The mullahs were quick to rein him in. Let's not make this a tempest in a teapot.  (back)


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Published April 10, 2006