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Atrios among others has already noted how Iraq is being written out of the Obama-Clinton primary fight. Scrubbing Iraq from the history books seems to be a full-time occupation for a lot of journalists these days. Now maybe it's that I'm driving a lot because it's fourth of July weekend, so I'm noticing gas prices, but this 3654 word article in the New York Times today titled 'American Energy Policy, Asleep at the Spigot' by Nelson Schwartz, about oil policy over the last thirty years made my eyes bulge when I kept looking for the word 'Iraq' and found only one reference, to the war in 1991.
What I found instead of discussing oil prices and Iraq were quotes from sources like Chevron CEO David O'Reilly, who describes himself a moderate Republican.
"We can see how you can get to $100," he says. "At $140, I just don't know how to explain it. We're surprised.
I also found from quotes Republican Senator Pete Domenici, who tells it like this.
"Much of what we're seeing today could have been prevented or ameliorated had we chosen to act differently," says Pete V. Domenici, the ranking Republican member of the Senate Energy and Natural Resources Committee and a 36-year veteran of the Senate. "It was a bipartisan failure to act..."
"We've got to fix it or our standard of living will change within a decade," says Senator Domenici, who is retiring this year. "Oil was too damn cheap, it's too high now and it's going even higher. I hope I'm wrong, but the problem is, we can't catch up soon enough."
There are more quotes from political figures, mostly Republicans, discussing bipartisan failures to act on conservation or more drilling. Schwartz paints a picture of a tragic episode of Democrat Chuck Schumer and Republican Frank Murkowski trying to broker a deal in 1998 to raise CAFE standards and open up Alaska to more drilling, calling it a 'grand bargain' that failed.
It's remarkable but unsurprising that he New York Times is collaborating with Republican sources to write Iraq out of the narrative on oil prices. It's important to understand context here. America's demand for oil fell in the 1970s, and stabilized until the mid-1990s, at which point it began increasing again. When George W. Bush came into office, oil demand was going up, and he had three choices. He could preach conservation (Carter), throw the country into recession and kill oil demand (Reagan), or find a new source for oil. He chose the third.
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In 2002 Under Secretary of Commerce Grant Aldonas thought that invading Iraq would reduce oil prices.
"It will open up the spigot on Iraqi oil, which would certainly have a profound effect in terms of the performance of the world economy for those countries that are manufacturers and oil consumers," he said during a press conference.
Dick Cheney's secret 2001 Energy task force which included a "detailed map of Iraq's oil fields, terminals and pipelines as well as a list entitled "Foreign Suitors of Iraqi Oilfield Contracts."
The task force report was released in May 2001. In it, a chapter titled "Strengthening Global Alliances" calls the Middle East "central to world oil security" and urges support for initiatives by the region's oil producers to open their energy sectors to foreign investment.
The oil companies were in on it, despite Mr. O'Reilly's bafflement at higher prices. Chevron CEO Kenneth Derr, the predecessor of O'Reilly, said in 1998:
"Iraq possesses huge reserves of oil and gas -- reserves I'd love Chevron to have access to."
It's worth noting that the possibility of a war in Iraq causing either a huge drop in price or a spike was on the table, and that oil companies were drooling at the prospect.
"There already is a stampede, with the Russians, French and Italians already lined up," said Lawrence Goldstein, president of the Petroleum Industry Research Foundation, a New York think tank funded by large oil companies.
Until now, debate over the economic impact of a U.S.-led attack on Iraq has focused mostly on short-term dangers. Pundits have worried that just as during the Gulf War, a new Iraq war would disrupt oil exports from the Persian Gulf and cause a sharp spike in petroleum prices.
Additionally, warnings like this were all over the place in 2002.
Finally, war with Iraq carries real risks that the US would face a worse world oil market throughout George W. Bush's and Dick Cheney's political careers.
One hint of the possibilities: An impending conflict has already added a "war premium" of $3 to $5 a barrel to the cost of oil, according to some analysts.
It's just not plausible that the CEO of Chevron or a Republican Senator from an oil-producing state were not paying attention to a possible war in the country with the second largest proven oil reserves in the world. But don't take my word for it, take oil industry analysts looking at the situation before the war started.
"If we go to war it's not about oil.... But after Saddam, it becomes all about oil," says Lawrence Goldstein, president of the Petroleum Industry Research Foundation.
In that same article, Amy Myers Jaffe, an energy analyst at the James A. Baker Institute for Public Policy at Rice University, estimated Iraq oil could lower prices by $3-5 a barrel while destroying Saudi Arabia's strategic position as swing producer of oil.
It's possible that the Iraqis would manipulate this flow in concert with fellow OPEC members to keep prices high. It's also possible that a new Iraqi regime would try to pump as much as possible to help fund vast reconstruction projects - and, perhaps, to keep its new ally the US happy.
It's worth noting that threats to Iran, a civil war in Iraq, and possible resulting instability in Kuwait and Saudi Arabia can probably explain price spikes. With a plausible threat that the first, second, and third largest sources of world oil production will stop sending oil onto the global markets, prices are skyrocketing, though printing massive numbers of dollars doesn't help. Schwartz doesn't discuss any of this, preferring to portray current oil problems as a result of bipartisan stubbornness. Democrats wouldn't allow drilling and Republicans wouldn't allow higher fuel efficiency standards. That's the story Chevron CEO O'Reilly, Pete Domenici, and the New York Times are telling.
Since progressive bother to open our eyes to reality, we notice that America just tried to invade what is essentially the second largest gas station in the world. And we screwed it up. In 2002, I saw signs at protests that said 'no blood for oil'. And sure enough, we didn't get the oil. Maybe that surprised Mr. O'Reilly, who was used to a world where American corporations build lots of crap for countries that send us oil and ask for military protection. I've been to Dubai in the United Arab Emirates, and it looks like a super-sized Texas. The problem with Iraq is that our military didn't protect the gas station this time, something many people in the military saw as inevitable with this crew of neoconservative civilian con artists in charge (and the moronic Congressional leadership that wouldn't and still won't hold them accountable).
And so we have to find a different way of living, that gets us off what Barack Obama appropriately calls the 'tyranny of oil' (he doesn't say foreign oil, a key and welcome difference). Getting out of Iraq is going to help, because as long as we're there, oil prices will remain high and special interests like Chevron will continue to try and bid for Iraqi oil. Kurt Vonnegut analogized American to junkies for oil, and our elites are going to fight for every last fix if they can.
We can build a better energy future. The technology exists. The willpower exists. The resourceful exists. Getting out of Iraq is the first step, and that should be obvious to anyone driving this July 4th weekend. Obvious, I suppose, unless your paycheck depends on you believing differently. |
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