Paradigm-Shifting, Part I – Oil

Introduction to Series

When the stated goals of a persisting organization, institution or event regularly and consistently fail to be met enough times, it becomes necessary to ask whether and how such a failing cause or entity can remain in existence, what or who is keeping it alive, and why. The answer is often simple incompetence or idealism, but at a certain point, ulterior motives should be investigated (especially in instances where the failure of a stated goal regularly entails other unstated, predictable and consistent outcomes that benefit certain interested parties). In many situations, we can find good evidence that some institutions “fail” by choice with regard to their stated goals but can be conceived as achieving remarkable success when their deeds are evaluated by a different (hidden) metric. Shifting heuristics in this way, however, is difficult and resisted by most, perhaps because it requires a healthy dose of cynicism and abandonment of long-held beliefs and intellectual/emotional investment.

Part I – Oil

First of all, my B.A. in Philosophy doesn’t exactly make me an expert economist or energy analyst, but I pay enough attention that I think I can competently discuss these issues and provide some worthwhile insights.

Oil prices are regularly setting records, as anyone who drives knows. Politicians and pundits wring their hands and scratch their heads over why this is happening and what can be done. Environmentalists clash with conservatives over drilling, and so on. As always, the media carefully avoids allowing too much substance into the conversation.

Although rising global demand for oil (without proportionate supply increases) would be the first place to look for blame for this phenomenon if it were more incremental, the more immediate causes of the drastic gas price increases of the last few years, and the last few months especially, should be sought elsewhere. The three main culprits seem to be: 1) the devaluing of the dollar, 2) market speculation on oil, 3) fears of further unrest in the Middle East.

Of these three, only #2 has been officially looked at by Congress (spurred on by distressed airlines, no doubt), and measures to curb speculation on oil are supposedly being considered. We’ll see if anything comes of it.

The other two reasons are not allowed into mainstream discourse, because the aims of our ruling oligarchy include both a worthless dollar and constant war. Globalism [Word 2002 doesn’t recognize that word; how rapidly times change] and militarism are two of the most important components of our empire. Imagine our rulers returning to fiscal sanity and abandoning their murder-based foreign policy.

Don’t chalk this up to “incompetence” though. Bush’s much-maligned Mission Accomplished banner was in part obvious bullshit propaganda, but in part entirely accurate. Our bipartisan foreign policy establishment had finally managed to crush Iraq, their publicly stated goal since the 1990s, if not before. Most Americans stood by complacently or complicitly and watched their tax dollars being converted into dead civilians on the other side of the world.

War, wealth redistribution, and the slow strangling of America are among the real goals. Mission (almost) accomplished. Of course Iraq (and Afghanistan, for that matter) posed no threat to us, and our government knew that. The “faulty intelligence” canard has been roundly disproved. Nor was some amorphous “freedom” the motivation. Saddam Hussein was about to start selling oil in currencies other than dollars, and we don’t allow that. (This is not the only reason for the invasion, but it’s probably pretty relevant with regard to timing.) This would have weakened the dollar and possibly threatened our access to oil somewhat – but this is only allowed by our own government. That’s likely part of the reason why the CIA attempted to assassinate Hugo Chavez a few years back as well. And part of why some of our more psychopathic oligarchs are slavering for Iranian blood.

This gun-barrel diplomacy results in more precarious oil supply, though, not less. The great supply disruptions caused by our occupation of Iraq, plus the astonishing billions upon billions we’ve thrown into that black hole have cost us far more than it would have to simply buy Iraq’s oil on the market. Oops? Nope. Mission accomplished. You and I are paying the difference.

Scarcity increases prices. Increased prices mean increased Exxon profits. With Iraq’s oil pumping ability crippled, and all of that crude sitting safely underneath the political and social chaos we’ve created, and underneath our megabases, our warmakers and profiteers have two wishes granted: scarcity they can’t be blamed for, and a giant oasis of oil that no one else can get to. In effect, this means prices go up at the same time as (their) supply goes up. It’s the best of both worlds for Big Oil and its squires in government.

Yes, this line of argument implies that the mess we’re making of Iraq is intentional and not the result of mere incompetence. As Chris Floyd and others have noted, Iraqi opinion polls demonstrate clearly that they want us gone. Luckily, it’s a shitstorm there and they don’t have even the semblance of a real government (nor even a functional puppet government) to resolve on our exile, let alone enforce it. Iraqi civil war is good for US business. And not only the oil business, of course, but also business for “defense” contractors and other profiteers.

There is much more than circumstantial evidence for this conclusion. When our military disbanded Iraq’s army shortly after the invasion, we sent them packing with their guns. There are also innumerable well-documented acts of terrorism aided by or even committed by US military forces in Iraq against civilians and sectarian religious sites to ignite the religious and sectarian civil war currently being waged. This is classic carbomb terrorism, above and beyond the regular aerial bombing carried out from the air. There are the billions of dollars the Pentagon can’t account for, and more blatantly, the instances of palettes of cash and gun shipments from the US to Iraq disappearing. Of course, the Pentagon also overtly funds and arms regional warlords to fight against each other or else to lie low, whichever happens to be more politically expedient at the time. (Notice how the “surge” started “working” in the thick of election season.) Much more can be written on this, but not now.

Ethanol is an obscene inside joke. It may or may not be more environmentally friendly than gasoline, and might be more sustainable, but only if we can wean ourselves off of food first. Farmland that would have been growing food for humans is now growing food for cars instead. So of course food prices have skyrocketed in the last year, as we saw food riots globally and supermarket rationing domestically. The Guardian reports that:

Biofuels have forced global food prices up by 75% - far more than previously estimated - according to a confidential World Bank report obtained by the Guardian.

Ethanol is one of the worst alternative energy options available; we don’t fund the better options. Why? Because alleviation of the economic pressure on the population, part of which manifests as energy prices, is not the real goal. Cryptogon has a graph comparing US alternative energy funding versus US Iraq war spending, along with this commentary:

The U.S. spends more on the war in Iraq in one day (about $300 million) than it does on the ANNUAL BUDGET for the primary government laboratory that is tasked with renewable energy and energy efficiency research and development.

Why should it be surprising that the possible end of the oil era in the US is taking the form of a manufactured shakedown, when the rise of oil in the US was similarly manipulated? Eisenhower built the national highway system, supposedly for national defense purposes, and history shows that interested corporations flexed their muscle to undermine the expansion of public transportation systems in order to make car-buying more attractive. Absurdly low mortgage requirements and teaser interest rates made suburban McMansions available to almost everyone. The US military as global oil guardian, and capturer, made sure the black gold was always flowing thickly to our strip mall-centric communities.

To conclude, energy costs aren’t decreasing because those in power don’t want energy prices to decrease. (At least, not yet?) If they did want it, it would be a simple enough matter.

In five years, after we get saddled with a carbon tax, will people start to wonder why this massive income confiscation has only slightly reduced carbon emissions and only slightly increased oil availability? Will most people chalk it up to incompetence? Or should we be evaluating the success of the carbon tax by wholly different criteria?