Tag Archives: Oil

King George II

“In war, truth is the first casualty.” ~Aeschylus

 

            Imagine for a moment that our government has been hijacked by a totalitarian regime.  Let us imagine for a moment that we view the events of the past 8+ years in reverse order so that those events which we assume to be effects are indeed causes:

 

·         George W. Bush has still not been impeached and no investigation has ever been formally launched.

·         The country of Georgia under US auspices provokes Russia to counterattack, allowing the US to gain the political will in eastern Europe needed to go forward with the missile systems

·         The federal reserve bank assumes control of the financial system to assure its “security” while oil companies and oil producing countries such as Saudi Arabia reap record profits.

·         As a result of US Treasury monetary policy and Fed Reserve interest rate policy the U.S. dollar falls heavily with the resulting spike in oil and commodity prices which are priced in U.S. dollars.

·         The meltdown of the “sub-prime” mortgage market triggering events which eventually bring the U.S. financial system to the brink of bankruptcy.

·         The US Government discontinues reporting of M3, which is a measure of the money supply in circulation and which would, if used make clear the inflationary policies of the US government.

·         George W. Bush encourages the American public to buy homes at a record pace thereby creating the largest boom in US housing prices in history.

·         The US invades Iraq and occupies it for the next 5+ years

·         The CIA plants evidence which link Iraq to Al Qaeda and to weapons of mass destruction.

·         Tax cuts are passed which benefit primarily corporations and the highest net worth individuals.

·         The patriot act is passed which lays the groundwork for future expansion of the executive branch of government including the use of extraordinary rendition, torture, and domestic wiretapping.

·         Afghanistan is attacked in an effort to destroy the Taliban who provided support to the 9-11 Saudi Arabian jihadists.

·         George W. Bush tells the American public the most good they can do is go back to their normal lives and go shopping.

·         Saudi Arabian Jihadists hijack 4 passenger planes and fly them into civilian and military targets on 09/11/2001.

·         George W. Bush losses the popular vote but becomes president when the supreme court affirms a controversial election in Florida, a state of which his brother is the governor.

·         The neo-conservative think tank ‘Project for the new American Century’ is founded and publish among others a document entitled Rebuilding America’s Defenses which lays out the political utility of “some catastrophic and catalyzing event — like a new Pearl Harbor.”

·         Bill Clinton avoids impeachment on charges of perjury after lying under oath about a sexual affair he had which was investigated by order of congress.

·         Saddam Hussein invades Kuwait and Bush’s father attacks Iraq in the fist gulf war.

·         Bush’s father, former head of the CIA and vice president under Ronald Regan becomes the 41st president.

·         Donald Rumsfeld under President Regan visits Iraq to meet with Saddam Hussein and re-affirm the US’ support for Iraq against Iran.

·         The CIA trains Osama Bin Laden along with other Jihadists to fight the Soviets in Afghanistan.

·         The US installs Saddam Hussein in power in Iraq and provides conventional, chemical, and biological weapons systems which are used against Iran and Iraqi Shiites and the Kurds.

·         George H. W. Bush receives Saudi Arabian financial support in his Texas oil business and early political career.

 

 

The following excerpts are from an article written by David Bromwich entitled Georgia and the Push for Cold War and which detail some of the conclusions that can be drawn from observing

“When Mikheil Saakashvili (The Georgian President) attacked the Russian peacekeepers in Tskhinvali, he expected to find success, or, at least, some cashable Western support. Part of his wish was granted. As soon as the Russians counter-attacked, an American politician was ready with threats and dire prophecies. John McCain was out of the gate on Georgia long before George W. Bush or Condoleezza Rice or Robert Gates made their first statements for the record. Why? Who gave McCain his early cue?

A fair bet is Saakashvili, through his closest American friend and former agent, Randy Scheunemann. Since Scheunemann is John McCain’s adviser on foreign policy, this looks like a dangerous contact — dangerous, that is, for the security of the United States. Yet it follows a pattern. Scheunemann was the agent of Ahmed Chalabi in agitating for the war against Iraq. He is a former director of the Project for the New American Century, which welcomed a world at permanent war, dominated by the U.S., as the order of the 21st century. And Scheunemann is as closely linked as it is possible to be — while holding a nominally different post — with the American Enterprise Institute, the Office of the Vice President, and the Weekly Standard: the most drastic and persistent lobbying network for the Iraq war, and the group that lately pressed the hardest for a war with Iran.

Seven and a half years into an administration that seems likely to go beyond January in all but name — so deeply are its patterns now ingrained in the culture of lawmakers and the mainstream media–the signs are strong that we are run by a government-within-the-government. The heart of the second government may not lie now in the connections between the West Wing and the OVP (Office of the Vice President), since the president now wants to know even less than he previously did; but the vice president is interested as always in everything: his men would be sure to know of the unorthodox gambles in the campaign of Scheunemann-McCain. And Cheney, as it happens, spoke out soon after McCain, and in language closely aligned with his.

Under the new American regime of military force, the world does not respect us as it once did. But it does fear us. And for a nation that is militaristic — whose highest virtue is military glory, whose medals of freedom are chiefly awarded to military men, whose idea of genius is most nearly answered by the general who devises the battle plan — for such a nation as we are becoming, to be feared may be the highest of attainments. The neoconservatives have long said so. This was the burden of their two leading documents published in the year 2000: the William Kristol-Robert Kagan anthology Present Dangers, and the Donald Kagan Gary Schmidt-Thomas Donnelly treatise Rebuilding America’s Defenses. An essay exploring the methods for overthrowing Saddam Hussein, in the first of these volumes, was contributed by Richard Perle. The second and more technical volume contained the famous sentence about the political utility of “some catastrophic and catalyzing event — like a new Pearl Harbor.”

 

            Ron Suskind in his book The Way of the World: A Story of Truth and Hope in an Age of Extremism claims that the White House illegally ordered the CIA to forge and disseminate false intelligence documents linking al-Qaeda and Iraq along with the presence of Iraqi weapons of mass destruction. What is preventing congress from calling an independent counsel like Kenneth Starr who can bring an investigation forth through which George W. Bush, Dick Cheney, and the rest of the Bush administration can answer questions under oath?

           

            Why might the Democrats in Congress be so reluctant to investigate and impeach Bush, no matter how damning the evidence against him? What if the 2000 election was managed to ensure that Bush would win? What if individuals and organizations which pledge allegiance to no nation in particular facilitated and allowed the events of 9-11 as a means to launch wars of aggression and consolidate power within the executive branch of government?  What if the president had seized the power of unlimited, unchecked domestic spying? Would the president’s political opponents be subject to intimidation and blackmail?  Can we imagine that our country has allowed the president so much power as to effectively prevent the political avenues of dissent and opposition? 

           

            Can we recognize in the following paragraph anything that rings true today?

 

 “Governments are instituted among Men, deriving their just powers from the consent of the governed, That whenever any Form of Government becomes destructive of these ends, it is the Right of the People to alter or to abolish it, and to institute new Government…  when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”

 

            What incendiary, unpatriotic, and dangerous document could the above have come from? It is from the second paragraph of the Declaration of independence.  Perhaps we should re-read the documents upon which our country was founded and ask ourselves just how far we have come from the principles upon which we gained our freedom.  Can it be true that we are now the incarnation of the very worst abuses of power against which a revolution waged and a new nation, conceived in liberty and dedicated to the proposition that all men are created equal was founded?

 

http://www.archives.gov/exhibits/charters/declaration_transcript.html

 

 

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So here it is…

So call me a conspiracy theorist but here it is:   Why the fuck is the price of oil so damn high?!?  Like some sort of fever it just keeps going higher.  When will it stop and how much more can people take?  Fortunately there is a cure.  Unfortunately, its a long and painful withdrawal process.  From a national addiction to debt fueled by oil can we still change our government as a people? Or are we to remain junkies to the world, a democracy in name only where our own government is our dealer. 

From 1972 until 1978 prices of oil had shot up by almost 50% however that was dwarfed by the next accelerated spike in 1978.  For the next 8 years the price of oil on a nominal basis, which is measured against a constant currency value, drops in measured steps.  However on an inflation adjusted basis the drop is significant and steep.  The reason the two measures diverge during this period is inflation. 

   Let’s face it, the last time oil prices shot up lasted from ’72 to ’86 peaking around ’78.  The below chart is as of April 2008.  The price of oil at that time was $117 a barrel.  Today, June 20th 2008 the price of a barrel of oil is $135.  So what’s next? Does the price of oil come down as fast as it went up? Not so fast, because From 1978 to 1982 the rate of inflation averaged 11% and was as high as almost 15%.  As much as the price of oil will come down following the spike, so much more will everything else begin to cost.

   So here it is… when the price rises in oil come to a stop, don’t celebrate.  Look carefully because by then whatever is saved is lost on price increases elsewhere.  The great unspoken tax, levied through federal interest rate policy and US Treasury money supply controlled increasingly by executive powers which are bailing out the major banks at the expense of the American people.  Watch the money trail and notice who benefits and who suffers as the economy “recovers”. 

   A radical shift is needed which will stop the Fed policies of artificially low interest rates and stem the tide of money which the Treasury has let loose.  Until the government is stopped from bailing out the financial interests behind their politics, the American people will be robbed with a silent tax. 

   Will the cure be worse than the disease? As painful and financially damaging as price increases in the US will be, it is nothing compared with the effects in countries around the world.  The question remains if the US is still strong enough as a nation to take the necessary steps to start curing its national addiction.  Interest rates higher than most people under 30 years old can imagine and years of tough economic times are the cure.  Will the US be able to get clean? Probably.  Will the US be able to stay clean? Probably not, but it’s time to start trying.

inflation adjusted oil prices chart

The last summer of George

          With gas at $4 and no end in sight we are entering the final act of the tragedy that is the presidency of George W. Bush.  A true global pyramid scheme, the global consortium of banking and oil which has installed GW Bush and has controlled the agenda for almost 8 years is now in a profit reaping feeding frenzy.  The billions of people that walk the earth are the food for this cannibalistic machine of power and wealth.  As January 2009 approaches and with the assumption of a new president on the horizon, the last stages in the life cycle of this incarnation of the beast play out.  As billions of people starve the oil interests who directly installed GW Bush in the 2000 election take their fill.  The planned occupation of the Middle East continues to try and achieve its goal of connecting control of oil reserves and pipelines from Afghanistan and Iraq to the Caspian Sea. 

            Thinking of the state of current global commodity prices, foreign exchange rates, and debt markets one cannot help but ask how this state of economic affairs benefits those interests who stand to profit from high food and energy prices, a weakened US dollar, and a never ending military contract and defense operation.  Think of the US’ reaction after 9-11 and ask who stands to benefit from the Invasion of Afghanistan and the passage of the patriot act.  Think of who benefits from the US’ invasion and occupation of Iraq.  Ask how the son of Texas oil men with close connections to Saudi Arabian oil men benefits from oil prices at historical highs.  Ask how the son of a former director of the CIA, Vice President, and then President benefit from the continuation of the “war on terror”.  Ask how the son of the Saudi BinLadin Group and former CIA operative against Moscow benefits from bearing responsibility for the events of 9-11.  Ask who not capturing Osama Bin Laden benefits?

            When viewed together and with the benefit of hindsight a picture emerges.  What more will the global interests reap in this final act? 

 

The \

Crack Economics (originaly posted Sept. 3rd ’07)

Generally, political and social events are preceded by economic ones.  While this may grate against people’s sensibilities that they act as free individuals, there are large systematic forces individuals exist within.  When society is governed rationally and in the service of its citizen, these forces lift individuals up and provide them with the basis to make choices that benefit both society and themselves.  When society is governed poorly these forces serve the ends of those with the power to chose, at the expense of the vast majority who have only the means to serve.

            We may think that grand economic and social movements are forces beyond our control, like laws of nature.  It is this illusion that is perpetuated by those in power as a way to keep the majority convinced of their own impotence.  The fact is that history is not like gravity and current world events are not like the weather.  Society and economics are nothing more than the sum of human activity, and therefore under the control of humanity. 

            As powerful as we believe we are as a people to create and sustain wealth, we are yet nothing in the face of the forces of nature.  As powerful as we believe the leaders of our nation and the world’s economies are, they are nothing in the face of the truth of the economic realities of the individuals upon whose backs the powerful rest.  It is in this context that we should understand the effect economic events will have on society over the coming years. 

The relationship between the U.S. dollar and the price of oil illustrate a larger picture of the nature of our economy and the relationship between the state and its citizens.  Since oil is priced in dollars, a rise in oil prices would be tied to a fall in the U.S. dollar relative to other major currencies.  A weaker dollar means more serviceable national and consumer debt, but it also means higher inflation, more expensive goods from overseas including oil, less buying power for the average American.  As long as the price increases are not too dramatic, nobody seems to notice.  What we had owned is now worth less, but so is what we had owed.

Prices increase to compensate for the loss of value in the dollar. Inflation rises and the cycle continues, effectively transferring the wealth from the citizens to the government.  As the government creates more money, the value of the dollar falls as does the wealth of the individuals; and the government’s debt effectively shrinks in relation to the currencies that hold our debt.  The government in effect is in the business of producing Americans, shares of which are sold to private and foreign investors. 

The owners of this country have a vested interest in devaluing the U.S. dollar just enough to continue to expand the generation of wealth, but not enough to jeopardize their investment.  Individual Americans experience the real value of their money decrease through inflation while the government as a result must take on more and more responsibility.  The government then treats any threat to this economic order as a threat to the national security of its citizens.  It is a deal with the devil in which we implicitly agree to cede our power as citizens over to the government in return for the life we have created for ourselves.    

In 2000, Iraq converted all its oil transactions under the Oil for Food program to euros. The U.S. invasion of Iraq has more to do with the fear of losing control of the universal denomination of oil the US dollar enjoys, than it does with 9-11 and the war on terror.  When the U.S. invaded Iraq in 2003, it returned oil sales from the euro to the USD.  Similarly, Iran planned to begin selling oil denominated in euros in March of 2006.  Wars continue to be fought to protect the transfer of capital from the U.S. middle class to the owners of the U.S. Government’s debt. 

We have been convinced that we have had a healthy and strong economy.  In actuality, what we now have is an economy in which credit functions like a cancer; and where we cannot stop growing our debt because it is the thing that sustains us.  The gradual devaluation of the US dollar since the 1970s has been the means by which we have achieved growth; the true cost of which has yet to be fully realized.

Each economic revolution whether agricultural, industrial, or digital is a form of the reorganization of society in fundamental ways.  While there are powerful economic currents which individuals must navigate, the source of all wealth is still the activity of individual human beings.  While the culture of debt is powerful, the individual always has a basic ability to choose.  Economic events generally precede social and political ones.  We have felt but a momentary fix of the withdrawal that awaits.  It is our national addiction, getting high off a pawned future. In crack economics, you either get clean or die a slow death.

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