Monthly Archives: October 2017
The real reason for recent US wars
A guest editorial in the Eugene, OR Register-Guard newspaper today reveals that keeping the dollar the dominant global currency is even more important than oil in US foreign policy and war planning. According to “Crude Facts” by M. Reza Behnam, a political scientist specializing in the politics and governments of the Middle East and American foreign policy there, US wars in the Persian Gulf have been more about about stabilizing the oil currency policies that have fueled America’s expansive economy since 1945 than about securing actual oil supplies.
Behnam notes that when the victors in World War II “met at Bretton Woods, N.H., in 1944 to create a modern, stable global economic system, they agreed to inaugurate an international gold-backed monetary standard reliant on the U.S. dollar – a logical decision at the time, since the United States had the largest gold reserves at $35 per ounce of gold.” In 1971, however, “with gold stores dwindling, President Richard Nixon ended the gold standard.
Political and economic uncertainty characterized the 1970s. Inflation soared as the government freely printed dollars to cover the costs of the Vietnam War and President Lyndon Johnson’s Great Society programs. The 1973 oil embargo by Arab nations that belonged to the Organization of Petroleum Exporting Countries – payback for U.S. military aid to Israel during the Yom Kippur War – quadrupled oil prices. With the U.S. economy in a nosedive, the Nixon administration, anxious to maintain the global demand for dollars, persuaded the hostile Saudi government to finance America’s debt with its petroleum wealth. Nixon convinced the Saudis that it was in their best interest to price their oil only in U.S. dollars, and to invest their surplus oil profits in U.S. Treasury bills. For its part, the United States agreed to provide weapons and protection to the House of Saud. The agreement ended the oil embargo and bound two disparate countries together for decades. By 1975, all OPEC countries had priced their oil in dollars.
For more than 40 years, global energy transactions and international trade have been conducted mainly in dollars, maintaining the United States’ status as an economic superpower. The petrodollar bargain of 1974 is why Washington staunchly backs the Saudi autocratic government that represses half its population [the Shia minority], funds extremist Sunni groups worldwide, and nurtured 15 of the 19 hijackers who carried out the terrorist attacks on Sept. 11, 2001. It also explains Washington’s support for Saudi Arabia’s devastating bombing campaign in Yemen and the two countries’ obsession with Iran as a regional threat.
America’s wars in the Middle East have everything to do with eliminating challenges to the petrodollar system. Such a challenge was central to President George W. Bush’s decision to invade Iraq, a country with the world’s second-largest oil reserves, and overthrow Saddam Hussein. Saddam’s fate was sealed when – encouraged by the French and eager to end crippling sanctions – he decided, in late 2000, to trade Iraqi oil in euros, the world’s second-largest reserve currency, and converted his $10 billion reserve fund at the United Nations to euros. Bush’s invasion of Iraq in March 2003 finished off this threat to the petrodollar and sent a clear warning to other countries considering an alternative oil transaction currency.
The 2011 intervention in Libya and the overthrow of Muammar Qaddafi can be seen through the same prism. For decades, a number of African countries, led by Qaddafi, had been attempting to establish a pan-African currency based on Libya’s gold-backed dinar. Qaddafi’s goal was to provide the continent with an alternative currency, and to replace the dollar with the Libyan dinar in future oil sales. E-mails from Hillary Clinton’s State Department reveal French President Nicolas Sarkozy’s fears about the threat Qaddafi’s pan-African currency posed to the established economic order. Qaddafi’s life, along with his plan for a united African currency, ended when NATO forces, spearheaded by France and Britain and with U.S. cooperation, invaded Libya.
The 2002 failed coup attempt against President Hugo Chavez in Venezuela – reportedly with the assistance of the CIA – also came shortly after the country considered switching to the euro for its oil sales.” Venezuela continues to be an enemy not because it’s a dictatorship under Chavez’s successor, Nicholas Maduro, but because “in 2007, Chavez instructed the state oil company to change its dollar investments to euros and other currencies.
Cracks appear to be emerging in America’s hegemony over the global financial system, and the United States’ impolitic conduct in the Middle East reflects its angst over these developments. The intensity of U.S. rancor toward Iran has increased as Tehran, along with Moscow, has led the effort to break free from the petrodollar monopoly. That Tehran has been pricing its oil in currencies other than the dollar and seeking to create a Middle East energy exchange market are viewed by Washington as provocative moves, and have placed Iran squarely on America’s target list. Since 2003, Iran has been shifting its foreign-held assets and the reserve funds in its central bank from dollars to euros, and it stopped accepting U.S. dollars for oil in 2007. Another circumvention of the dollar is the establishment of the Iranian Oil Bourse, also known as the Iran Crude Oil Exchange, opened in 2008. Its objective is to sell oil and gas in non-dollar currencies, primarily the euro, the Iranian rial, the Japanese yen, and/or a basket of other major currencies. Onerous Western sanctions have pushed Tehran and Moscow to abjure dollar-denominated trade, favoring euros, rubles, and rials instead. In 2012 Iran, which supplies 15% of China’s oil and natural gas, began conducting its energy deals with China in yuan (China dropped the dollar peg in 2005). India and Russia trade oil with China in rubles and yuan, and China and Japan have agreed to use their own currencies in their transactions. South Korea has also been slowly moving from dollars in its transactions, buying Iranian oil with the Korean won, and shifting its investments to other currencies. As the world’s leading consumer of oil and natural gas, China has enough leverage over Saudi Arabia and the other Gulf oil producers to pay for its oil imports in yuan. Increased trade with China has intensified the pressure on Saudi Arabia to forsake the dollar. The United Arab Emirates has already agreed to use the yuan in its petroleum trade with China.
Saudi petrodollars have financed Washington’s military adventures and spending sprees. As a major holder of U.S. Treasury bills and one of the United States’ largest creditors, the kingdom wields a potent political weapon. It attempted to use that weapon in 2016, threatening to sell as much as $750 billion in Treasuries and assets if Congress passed legislation allowing it to be held liable in U.S. courts for the Sept. 11, 2001, terrorist attacks.
The Saudis have traditionally seen the United States as their chief regional partner, but the unusual visit to Moscow in early October by Saudi King Salman reveals fissures in the 1974 iron-clad agreement, and an acknowledgement of the changing balance of power in the region.
The world’s reliance on the dollar as the global reserve currency is beginning to erode. Demand for the dollar for global oil and gas transactions is lessening as countries have grown weary with America’s dominance of the world economy and use of military force to punish currency dissenters. The momentum toward non-dollar trading could severely undermine the U.S. economy, one of the most debt-ridden in the world. The house of cards built by the United States in the 1970s could easily collapse if the rest of the world abandons the dollar standard. Right now, the resulting massive economic disruption to the world economy isn’t something most developed nations want to try to live with.
The United States, with its economic imbalances and soaring deficits, has the most to gain by working cooperatively with the rest of the world to gradually reform the global monetary system. But that requires it to forego its imperious myths and trade its belligerent superpower role in favor of international mediation to achieve global economic stability and security.”
A thoughtful approach to “Me Too” and other important conversations
I like Joanna Bock’s take on the #MeToo phenomenon, published October 19th in Yes! Magazine, except that she calls it a “movement,” which I think is a much bigger thing than just a Facebook/Twitter hashtag. Here are the main points in the article with which I agree:
“Movements like #MeToo can be powerful in many ways. But we limit their potential and pervert them when we insist that everyone get in a box and become one of three things: perpetrators, victims, or allies. How many of us don’t neatly fit any of those categories? How many of us are weakened by the divisions?Something similar happens when we talk about race and racism. People of color are the victims. Outright bigots are the villains. And among the rest of us, we make a mad dash to position ourselves as allies. To be allies, we have to publicly condemn the racist ‘other.’ [Or his/her behavior…]
#MeToo has given voice to the rage many female friends of mine feel at specific perpetrators of harassment and violence in their own lives. But the truth is that no one human being is to blame for this sickness of the culture we’re a part of. And our scramble to crucify the Harvey Weinsteins and Donald Trumps of the world only obfuscates the issue, just as our scramble to line up simply as victims does.
In this oppressive system – where women’s bodies are not safe, where people of color’s bodies are not safe, and where women of color’s bodies are unspeakably violated terrain – we are all suffering. And in this system, where men’s internal and emotional landscapes have been violated from birth, as well as the bodies [and minds] of women, we are all victims – playing out our roles or resisting them when and where we can. We’re enormously alienated from one other. Our most radical option is to undo that alienation, but easy labels and unjust oversimplifications deepen it. We’re all responsible for saving each other.”
I agree with the gist of Bock’s message, but want to say that I Facebook-posted “Me too” to help show the extent of the problem and to show solidarity with other women similarly violated – not to express anger at my rapist, though I don’t go so far as to feel empathy with him. I don’t feel anger at men in general either, and deplore the boxes our society tries to put them in. My main concern is that we all recognize the extent of our sexist, racist, and violent, war-mongering culture as a necessary prelude to changing it for the better. It seems kind of ironic to say this while we have a racist, sexist, war-mongering president, proud of his selfishness and sexual predation, but maybe that’s what’s opened up the wounds – and the necessary conversations.
Let’s use empathy in those conversations – really listening to what others need to express. Some of it may be ugly, even poisonous. But feelings are never wrong – only behavior can be – and the poison needs to be exposed and transformed, however gradually, in love and acceptance. We’re challenged as speakers to be that trusting and honest and as listeners to be that compassionate. Alienation can become connection and caring community, but we can’t skip any of steps.
Historian Bruce Cumings on North Korea
In “A Murderous History of Korea,” published 5-18-17 in the London Review of Books, historian Bruce Cumings asks how “a puffed-up, vainglorious narcissist, whose every other word may well be a lie (that applies to both of them, Trump and Kim Jong-un), comes not only to hold the peace of the world in his hands but perhaps the future of the planet? We have arrived at this point because of an inveterate unwillingness on the part of Americans to look history in the face and a laser-like focus on that same history by the leaders of North Korea.
North Korea celebrated the 85th anniversary of the foundation of the Korean People’s Army on April 25th, amid round-the-clock television coverage of parades in Pyongyang and enormous global tension. No journalist seemed interested in asking why it was the 85th anniversary when the Democratic People’s Republic of Korea was only founded in 1948. What was really being celebrated was the beginning of the Korean guerrilla struggle against the Japanese in northeast China, officially dated to April 25, 1932. After Japan annexed Korea in 1910, many Koreans fled across the border, among them the parents of Kim Il-sung, but it wasn’t until Japan established its puppet state of Manchukuo in March 1932 that the independence movement turned to armed resistance. Kim and his comrades launched a campaign that lasted 13 difficult years, until Japan finally relinquished control of Korea as part of the 1945 terms of surrender. This is the source of the North Korean leadership’s legitimacy in the eyes of its people: they are revolutionary nationalists who resisted their country’s colonizer; they resisted again when a massive onslaught by the US air force during the Korean War razed all their cities, driving the population to live, work, and study in subterranean shelters; and they’ve continued to resist the US ever since.”
Cumings says North Korea (officially the Democratic People’s Republic of Korea) “is less a communist country than a garrison state, unlike any the world has seen. Drawn from a population of just 25 million, the North Korean army is the fourth largest in the world, with 1.3 million soldiers – just behind the third largest army, with 1.4 million soldiers, which happens to be the American one. Most of the adult Korean population, men and women, have spent years in this army: its reserves are limited only by the size of the population.”
US treatment of North Korea is completely “ahistorical, demonization transcending party lines and drawing on a host of subliminal racist and Orientalist imagery; no one is willing to accept that North Koreans may have valid reasons for not accepting the American definition of reality. Their rejection of the American worldview – generally perceived as indifference, even insolence in the face of overwhelming US power – makes North Korea appear irrational, impossible to control, and therefore fundamentally dangerous. But if American commentators and politicians are ignorant of Korea’s history, they ought at least to be aware of their own. US involvement in Korea began towards the end of the Second World War in 1945, when State Department planners feared that Soviet soldiers, who were entering the northern part of the peninsula, would bring with them as many as 30,000 Korean guerrillas who’d been fighting the Japanese in northeast China. They began to consider a full military occupation that would assure America had the strongest voice in postwar Korean affairs. Several of the planners were Japanophiles who’d never challenged Japan’s colonial claims in Korea and hoped to reconstruct a peaceable and amenable postwar Japan. They worried that a Soviet occupation of Korea would thwart that goal and harm the postwar security of the Pacific. Following this logic, on the day after Nagasaki was obliterated, John J. McCloy of the War Department asked Dean Rusk and a colleague to go into a spare office and think about how to divide Korea. They chose the 38th parallel, and three weeks later 25,000 American combat troops entered southern Korea to establish a military government.
To shore up their occupation, the Americans employed every hireling of the Japanese they could find, including former officers in the Japanese military like Park Chung Hee and Kim Chae-gyu, both of whom graduated from the American military academy in Seoul in 1946. (After a military takeover in 1961, Park became president of South Korea, lasting a decade and a half until his ex-classmate Kim, by then head of the Korean Central Intelligence Agency, shot him dead over dinner one night.) After the Americans left in 1948, the border area around the 38th parallel was under the command of Kim Sok-won, another ex-officer of the Imperial Army, and it was no surprise that after a series of South Korean incursions into the North, full-scale civil war broke out on June 25, 1950. Inside the South, whose leaders felt insecure and conscious of the threat from what they called ‘the north wind,’ there was an orgy of state violence against anyone who might somehow be associated with the left or with communism. The historian Hun Joon Kim found that at least 300,000 people were detained and executed or simply disappeared by the South Korean government in the first few months after conventional war began. My own work and that of John Merrill indicates that somewhere between 100,000 and 200,000 people died as a result of political violence before June 1950, at the hands either of the South Korean government or the US occupation forces. In short, the Republic of Korea was one of the bloodiest dictatorships of the early Cold War period; many of the perpetrators of the massacres had served the Japanese in their dirty work – and were then put back into power by the Americans.
Americans like to see themselves as mere bystanders in postwar Korean history. It’s always described in the passive voice: ‘Korea was divided in 1945,’ with no mention of the fact that McCloy and Rusk, two of the most influential men in postwar foreign policy, drew their line without consulting anyone. There were two military coups in the South while the US had operational control of the Korean army, in 1961 and 1980, during which the Americans stood idly by lest they be accused of interfering in Korean politics. South Korea’s stable democracy and vibrant economy from 1988 onwards seem to have overridden any need to acknowledge the previous forty years of history, during which the North could reasonably claim that its own autocracy was necessary to counter military rule in Seoul. It’s only in the present context that the North looks at best like a walking anachronism, at worst like a vicious tyranny. For 25 years now the world has been treated to scaremongering about North Korean nuclear weapons, but hardly anyone points out that it was the US that introduced nuclear weapons into the Korean peninsula, in 1958; hundreds were kept there until a worldwide pullback of tactical nukes occurred under George H.W. Bush. Every US administration since 1991 has also challenged North Korea with frequent flights of nuclear-capable bombers in South Korean airspace, and any day of the week an Ohio-class submarine could demolish the North in a few hours. Today there are 28,000 US troops stationed in Korea, perpetuating an unwinnable stand-off with the nuclear-capable North.
To hear Trump and his national security team tell it, the current crisis has come about because North Korea is on the verge of developing an ICBM that can hit the American heartland. North Korea tested its first long-range rocket in 1998, to commemorate the 50th anniversary of the DPRK’s founding. The first medium-range missile was tested in 1992, and North Korea now has many sophisticated medium-range missiles within range of 200 million people in Korea and Japan, not to mention hundreds of millions of Chinese, and the only US Marine division permanently stationed abroad, in Okinawa. It isn’t clear that North Korea can actually fit a nuclear warhead to any of its missiles – but if it happened, and if it was fired in anger, South Korea would immediately be turned into what Colin Powell memorably called ‘a charcoal briquette.’ But then, as General Powell well knows, we’d already turned North Korea into a charcoal briquette with years of aerial bombing, much of it with huge quantities of napalm, during the Korean War.
American policy has cycled through a menu of options to try and control the DPRK: sanctions, in place since 1950, with no evidence of positive results; non-recognition, in place since 1948, again with no positive results; regime change, attempted late in 1950 when US forces invaded the North, only to end up in a war with China; and direct talks, the only method that’s ever worked, which produced an eight-year freeze – between 1994 and 2002 – on all the North’s plutonium facilities, and nearly succeeded in retiring their missiles. On May 1st, Donald Trump told Bloomberg News: ‘If it would be appropriate for me to meet with [Kim Jong-un], I would be honored to do it.’ There’s no telling whether this was serious, or just another Trump attempt to grab headlines. But whatever else he might be, he is unquestionably a maverick, the first president since 1945 not beholden to the Beltway. Maybe he can sit down with Mr. Kim and save the planet.”
This article was written before President Trump began threatening North Korea with utter destruction and personally insulting Kim Jong-un.
For more, read Cumings’s books, Korea’s Place in the Sun: A Modern History, North Korea: Another Country, and The Korean War, A History.