[OPE-L:6156] Re: more on oilism thesis

From: Fred B. Moseley (fmoseley@mtholyoke.edu)
Date: Mon Nov 05 2001 - 00:25:51 EST

Rakesh, I don't know what "American left" you and Bina are talking about -
that supports US policy in the Middle East in order to guarantee our
supplies of oil?!  What groups or individuals do you have in mind?  

All the left discussions I read these days oppose US policy in the Middle
East and are emphasizing that the current conflict demonstrates once again
that we need to reduce our dependence on oil in general and get out of the
Middle East.  There is I think a growing integration between anti-war
groups and environmental groups, perhaps best illustrated by the US
Green Party, which has been strongly anti-war from the beginning
(i.e. Sept. 11).  

In any case, I certainly did not advocate what you misattribute to the
"American left".  What I said in my original "oilism" post is simply that,
if the Middle East did not have 2/3 of the world's proven oil reserves,
then the US would not give a shit about the Middle East.  There would be
no US troops in the Middle East and the US would not be involved in
military conflicts in the Middle East.  If there were no oil in the Middle
East, the US government would probably treat the Middle East like it
treats Africa, i.e. mostly with neglect.  

We may disagree on the relative significance of the physical stuff of oil
vs. petrodollars, but I hope that we can agree that "if the Middle East
did not have 2/3 of the world's proven oil reserves, then the US would not
give a shit about the Middle East ... and the US would not be involved in
military conflicts in the Middle East."  If there were no petrol, then
there would be no petrodollars.

Rakesh, do you agree or disagree?


On Sat, 3 Nov 2001, Rakesh Bhandari wrote:

> Date: Sat, 3 Nov 2001 12:05:17 -0800 (PST)
> From: Rakesh Bhandari <rakeshb@stanford.edu>
> Reply-To: ope-l@galaxy.csuchico.edu
> To: ope-l@galaxy.csuchico.edu
> Subject: [OPE-L:6149] more on oilism thesis
> Most on the American left seem to believe that given our dependence on Saudi 
> oil, we are forced to maintain the stability in the Gulf even if 
> the status quo means the continued rule of a corrupt regime that has now come 
> to flout us their patron. Simply put, the US is thought to be a hostage of the 
> Sa'udis.  
> Yet the  House of Saud probably could not survive a day without US support, and 
> any regime that came into power would soon recognize that any attempt to 
> restrict supply and thereby increase the price would accelerate the transition 
> to alternatives: according to Paul Davidson,  just above the current costs of 
> oil are the tar sands of Canada, Lake Maricabou in Venezuela, etc which are 
> good  alternatives to crude for petroleum products. 
> Moreover,  a much higher price of oil would lead the developed world into 
> either a severe depression or inflation; and that prospect keeps the Sa'udis 
> and OPEC in line, so to speak. The Sa'udis simply don't have the power to hold 
> the world over the barrel, yet this myth haunts the imagination of the American 
> left.  Moreover, the  Sa'udis external dependence on food and 
> technology makes them vulnerable; there seems to be no reason why with some 
> reserves a union of oil dependent states could not stare down any threat from a 
> wayward regime in West Asia. 
> The US interest seems not to be the ensuring of no breaks in the supply at a 
> reasonable price of a non renewable resource. If the US were in fact worried 
> about being held hostage by the Sa'udis, why not decrease that vulnerability by 
> lifting the embargoes on Iran, Libya and Iraq? Of course one could argue that 
> the US fears the exporting of a Ba'th party or a Shi'ite sect. But none of the 
> embargoed countries has shown any less willingness to sell oil to the US; it is 
> possible that a radical nationalist regime may not share profits in the same 
> way with US companies (and they shouldn't have to), but I don't think there is 
> evidence that the supply of oil would be cut off. A radical nationalist govt 
> may want to raise the price of oil, but again the constraints of the world 
> market are too tight.
> At any rate, here is Cyrus Bina from "The Rhetoric of Oil and the Dilemma of 
> War and American hegemony" in Arab Studies Quarterly, Summer 1993, vol 15, no 
> 3:
> "As I have explained above, since 'cheap' oil and 'expensive' oil no longer 
> exist in the eyes of the global market, one begins to wonder about the 
> motivation of a 'attaching' a special priority to Middle Eastern oil. Moreover, 
> while the differential cost of Middle Eastern oil is sizable, it never the less 
> apppears as differential rent in the global price. The remaining motivation 
> therefore is to divert a good deal from this sum (i.e., Arab oil rent) in order 
> to finance the various US expeditions in Africa or Central America by the 
> Saudis in the 1980s. This of course has nothing to do with oil pricing or the 
> necessity of oil for Western economies. It certainly has everything to do with 
> the milking of certain client states in the region in order to perpetuate the 
> global system.
> "Despite all this, in objecting to the recent war in agains Iraq, certain 
> commentators pointed out that 'The military alternative to energy efficiency 
> isn't cheap...[They further emphasized that] counting military costs, Gulf oil 
> now costs in excess of $100 a barrel." the conclusion that they have come up 
> was to urge the US govt to cut down on its 'dependency' on Middle Eastern oil. 
> In addition to the liberals, the radical left too argued the same way. Beneath 
> the reasonable appearance of such arguments, however, are two unreasonable and 
> false premises: (1) that global production and pricing are arbitrary, often 
> determined (through conspiracy and intrigue) by a few Middle Eastern oil 
> sheikhs or the shahs, in conjunction with the US state dept, thereby distorting 
> and overestimating the role of the US govt and its client regimes; and (2) that 
> the US govt and its represenatives are too stupid to realize that producing oil 
> in this manner is un-economical, thereby distoring and underestimating the 
> reality behind the US global mission. By accepting the false premise of threat 
> to our survival, the entire political spectrum, including the radical left in 
> this country, tried (and are still trying) to come up with a viable solution 
> according to delcared ideological positions. Some opted for the outright 
> invasion of the oil fields, others for the protection of notorious regimes. 
> Still others proposed conservation, increased energy efficiency, and a balanced 
> energy and environmental policy. Regardless of their conclusions as well as 
> their intentions, nearly all have missed  the point of that the need for oil  
> is a sideshow."
> Rakesh

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