news.independent.co.uk By Rupert Cornwell in Washington 23 February 2003

An increasingly cornered Iraq complained yesterday it might be signing its own death warrant if it obeyed a United Nations order to destroy dozens of missiles at the moment the US is poised to lead an invasion.

"They want us to destroy them at a time when we are threatened daily," said Owayed Ahmed Ali, the director of the Ibn al-Haithem plant, which produces the al-Samoud missiles, after another visit by UN weapons inspectors.

The protest is the most specific reaction yet to the demand by Hans Blix, the chief UN weapons inspector, that Baghdad start destroying the missiles by Saturday, after they were found to exceed the 93-mile range permitted by existing arms restrictions on Iraq.

With the order coming barely a week after Mr Blix's relatively benign report on 14 February, US diplomats were delighted. Not only does it impose a de facto deadline for Iraqi compliance, it also fits in with the likely timetable for the Bush administration to go to war.

Yesterday, President George Bush met Spain's Prime Minister, Jose-Maria Aznar, one of his strongest European supporters, at his ranch in Texas to discuss the new Security Council resolution Britain and the US will introduce tomorrow.

The draft is understood to contain no specific deadline. It will state that Iraq has failed to comply with UN resolution 1441 ordering it to disarm. Baghdad thus faces "serious consequences", the diplomatic formulation that authorises the use of force.

On Friday, Mr Blix will deliver a new report, this time behind closed doors. The next day is the deadline for Baghdad to start getting rid of its al-Samouds. Shortly after that, and certainly by 14 March, Washington and London are expected to force a showdown vote in the UN.

Whatever the outcome, Mr Bush repeated last week that the US would if necessary lead a "coalition of the willing" against Iraq. An invasion could begin any time, perhaps around 23 March, when moonless conditions will provide maximum advantage for US forces. Some analysts speculate the invasion might be launched sooner, if the administration calculates that further delay will erode international support.

As of last night – barring an act of reckless defiance by Saddam Hussein – the odds were stacked against London and Washington securing the required nine Security Council votes to pass the second resolution.

Colin Powell, the US Secretary of State, who is on a visit to East Asia mainly devoted to the stand-off with North Korea, will take time out in Beijing to press for support from China, a veto-holding member of the council. Washington will also use economic and financial sticks and carrots to try and bring waverers on board, as it is doing with Turkey.

www.economist.com Feb 20th 2003 From The Economist print edition Getty

Last weekend, American shop shelves were cleared of drinking water and duct tape. What next?

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“IRAQNOPHOBIA”—fear of the consequences of a probable war with Iraq—is being blamed for the sick state of the world economy and for the fall this year in the dollar and in most big stockmarkets. If fear is to blame, then a short, successful war should remove the uncertainty that is holding back consumer and corporate spending, allowing economic activity and share prices to bounce back again. Alan Greenspan, the chairman of America's Federal Reserve, appeared to suggest as much last week. But Iraq is only one of the problems facing the global economy. Others will continue to weigh it down even after the tanks and bombers have gone home.

An American-led attack on Iraq looks highly likely. But trying to assess the economic consequences of such an attack is tricky because of the vast number of unknowns and contingencies. For instance, how long will the conflict last? Will it escalate outside Iraq? Will there be any damage to oilfields, as there was in the Gulf war in 1991? Will other OPEC countries increase their oil production to compensate? And how badly will business and consumer confidence be hit? These are not questions that can be answered by plugging numbers into a computer model. Yet several investment banks and think-tanks have made a stab at it.

The United Nations and Iraq Feb 20th 2003 The cost of war Feb 20th 2003 The case for war Feb 20th 2003

Iraq, United States Iraq

Congressional Budget Office, House Budget Committee, Federal Reserve, OPEC, IMF

Most of them maintain that the likeliest scenario is a short, successful war. Oil prices would spike briefly at around $40 a barrel, but then plunge as the war ends. In turn, share prices and the dollar will rally, and confidence will revive, spurring a strong economic recovery. Several economists reckon that a war might actually be good for the world economy: it will eliminate today's mood of uncertainty, boost government spending, and push oil prices lower in the medium term as new Iraqi production comes on stream.

John Llewellyn, chief economist at Lehman Brothers, is much less sanguine. He argues that the risks to the global economy, taken together, are now greater than at any time since the 1973-74 oil crisis. Even if the war goes well, he argues, it will probably not be the panacea that investors are hoping for. The aftermath of war will be uncertain; the risk of terrorist acts will remain; and there are plenty of other worries too, not least over North Korea. The cost of fighting

The economic costs of a war can be broken into three types. First, there are the direct military costs. The six-week Gulf war in 1991 cost $80 billion in today's prices (most of it paid for by America's allies). Assuming a similarly short war, America's Congressional Budget Office and the House Budget Committee have both estimated a total military cost of around $50 billion, or 0.5% of America's GDP. Others reckon that a more protracted war could cost America as much as $150 billion.

Second, there are the potentially far larger indirect costs of peacekeeping, humanitarian assistance and reconstruction. William Nordhaus, an economist at Yale University, thinks that these could cost America between $100 billion and $600 billion over the next decade*.

Last but not least, there are the macroeconomic costs of lost output. Especially if the war goes badly, these could be far bigger than the others, which are really just efficiency losses from the diversion of resources. Mr Nordhaus estimates that the total cost of a war to America could range between $100 billion and $1.9 trillion, spread over a ten-year period. That could be as much as 2% of American GDP for every year of the decade.

The hardest of the three to pin down is the macroeconomic cost—to the world economy, not just America's. Broadly speaking, a war in Iraq could affect economies through four main channels: oil prices; stockmarkets; the dollar; and business and consumer confidence.

Oil prices have already reached their highest level for two years. West Texas Intermediate has risen above $36 a barrel, up almost 50% from last June. So far, though, this is a much smaller rise than in the run-up to the 1991 war. In real terms, oil prices today are less than half their 1980 peak. The conventional wisdom is that prices will fall sharply once a war is over, just as they did in 1991. Then they fell from over $40 to below pre-war levels after the ground war had begun. Optimists today argue that a victory will liberate Iraqi oil as well as its people. (This assumes that the Iraqis do not sabotage their own oilfields or those of their neighbours.)

So it is widely hoped that oil prices might this time also fall towards $20 a barrel once war is under way. But is 1990-91 the appropriate model? Even if the war is as short, oil prices may not fall as much this time because the background environment is different. Economists at Goldman Sachs argue that the recent rise in oil prices has had more to do with the disruptions in Venezuela than with worries about Iraq.

Venezuela's oil-industry strike may be over, but the country is unlikely to restore more than two-thirds of its output this year. Goldman Sachs reckons that the combined impact of Venezuelan and Iraqi disruption has the potential to be the biggest shock in oil-market history, even after allowing for some offsetting increases in supply from other producers.

Another reason why oil prices may not fall as sharply as in 1991 is that the oil market is much tighter. An exceptionally cold winter right across the northern hemisphere has boosted demand at a time when American oil stocks are at their lowest level since 1975. In 1991, oil stocks were well above normal.

OPEC also has less spare oil-production capacity this time to fill the gap. The cartel had spare capacity of 6m barrels a day when Iraq invaded Kuwait in 1990, compared with only 2m today. The continuing shortfall in Venezuela, plus even a small loss of output from Iraq, could rapidly exhaust that. In any case, Iraq will not be able to turn its oil taps on fully the moment that war ends. Goldman Sachs estimates, therefore, that oil prices may average no lower than $27 over the next 12 months.

Although the rich world uses half as much oil per dollar of GDP as it did in the 1970s, higher oil prices still have the power to hurt its economy. According to the IMF's ready reckoner,a $10 increase in oil prices, if sustained for a year, reduces global GDP by 0.6% after one year. That impact sounds fairly modest, but the snag with all such calculations is that they consider only first-round effects. They ignore the potentially much bigger impact on confidence and stockmarkets, and they ignore the effects that follow from changes in monetary and fiscal policy. Consistent underestimation

Even taking account of such factors, however, most forecasters still reckon that the American economy will slip into a new recession only if there is a more prolonged war, a much sharper rise in oil prices than now expected, and a stockmarket slump of at least 20%. Yet in the past, economists have consistently underestimated the economic impact of oil shocks.

Over the past three decades, oil prices have jumped sharply on four occasions: in 1973, after the first OPEC embargo; in 1979, after the Iranian revolution; in 1990, after Iraq's invasion of Kuwait; and in 1999-2000 as the world economy boomed and OPEC cut its production. Each time the price more than tripled, contributing to a global recession.

Higher oil prices hurt the economy in two ways. In the first place, the increase acts like a tax, raising firms' costs for any given output price. So if demand is unchanged, prices rise and firms produce less. Secondly, higher oil prices transfer income from oil-importing countries to oil producers, squeezing spending in the oil importers. In the economic jargon, both the aggregate demand and aggregate supply curves shift backwards. Output falls, but the impact on underlying inflation, and hence the appropriate policy response from central banks, is uncertain.

Whether central banks should raise interest rates to curb inflation, or cut rates to cushion output, depends on the cyclical position of the economy. The four previous oil shocks all took place during booms, when economies were already overheating and inflation was rising. This forced central banks to raise interest rates.

Today, the rise in oil prices is occurring in an environment of excess capacity and falling inflation. Firms have little pricing power, so it is harder for them to pass on higher costs. Rising oil prices are therefore more likely to erode profits than to push up inflation. That, in turn, would further delay a recovery in corporate investment and hiring. The correct response at such a time is to reduce interest rates, not raise them.

The Fed seems to understand this better than the European Central Bank, which frets more about its inflation target. But with interest rates at 1.25%, the Fed has little room to cut further. Euro-area rates (at 2.75%) leave more room to cut, but the ECB is likely to be slow to act. At its most recent press conference (earlier this month) its president, Wim Duisenberg, declared that “a rate cut now would be a mere drop that would drown in the sea of uncertainties”, referring to oil prices and geopolitical risks. Yet Germany, the euro area's biggest economy, may be back in recession again. The Bundesbank confirmed this week that German GDP fell slightly in the fourth quarter of 2002. And many private-sector economists reckon that output will shrink again in the current quarter. Bubble trouble

America has more room to ease fiscal policy. Indeed, a successful war will help George Bush to get congressional approval for his tax cuts. On the other hand, Japan (thanks to its already hefty public debts) and the euro area (thanks to its stability pact) have little room to ease policy, even in the event of a further downturn.

Underpinning the hope of a strong economic rebound after a war is the unstated assumption that America's economic fundamentals are sound. However, America has yet to complete its post-bubble adjustment. Record consumer debt leaves the economy vulnerable to shocks. American consumer confidence is at a nine-year low. Some blame this on the threat of war (in which case confidence could later rebound). But, in fact, more of it may be due to consumers' heavy debts, poor underlying job prospects, and falling stockmarkets.

Economists are using war fears as a convenient explanation for slower than expected growth—just as they (wrongly) blamed America's recession in 2001 on the September 11th attacks. Bill Dudley, an economist at Goldman Sachs, argues that war fears are not the biggest reason why the economy is soft. Instead, the problems lie deeper: in the excesses built up during the bubble years, such as huge private-sector debts, excess capacity, low saving, and a massive current-account deficit.

America's over-indebted households, Japan's deflation and its crippled banks, Europe's structural rigidities and its overly tight fiscal and monetary policies: all these mean that the world economy is horribly vulnerable to shocks of any kind. Moreover, after the Gulf war America's initial recovery was sluggish, due to the need for firms to reduce their debts from the excesses of the 1980s. Yet the excesses of the 1990s were much larger. America's fragile economy is, in a manner of speaking, being held together by duct tape. The 1.3% jump in retail sales (excluding cars and petrol) in January may partly reflect precautionary stockpiling of canned foods, bottled water and other goods. Trading blows

Most stockmarkets have fallen in each of the past three years, and many investors are hoping that getting the war out of the way will stop the rot. Between the start and finish of the Korean war, American share prices rose by 28%. In 1991, the S&P 500 rose by more than 20% within four months of the start of the air attack.

But America's stockmarkets looked cheaper in 1991 than they do today. A market with a p/e ratio of 28 on historic profits, and an average forecast of double-digit profit growth despite slow nominal GDP growth, is not exactly discounting bad news. Another big difference from 1991 is that analysts have already assumed a quick and painless war. Before the Gulf war they were much less confident. So the downside risk today is much greater. A prolonged war could drive property and share prices sharply lower.

How might exchange rates react? The sharp fall in the dollar in recent months may in part be related to war worries. So a quick victory, it is argued, would help the dollar to rally. The dollar bounced by 10% in trade-weighted terms within two months of the end of the Gulf war.

However, there is a big difference this time. In 1990-91 the net cost of the war to America was reduced from $80 billion, at today's prices, to only $4 billion after contributions from friendly Arab countries and Japan. These transfer payments flattered America's current-account balance in 1991 and so helped to lift the dollar. This time, America will have to foot most of the bill itself. In 1991, it had a small current-account surplus. Today, with its deficit running at more than 5% of GDP, any dollar recovery is likely to be short-lived.

Beyond the macroeconomic fall-out from war, there is one other big concern: that diplomatic tensions between America and Europe over Iraq could spread beyond war to trade. The two sides already have a string of bilateral trade disputes: over America's steel tariffs and its tax breaks for foreign sales by big multinationals; and over the EU's ban on imports of hormone-treated beef and genetically-modified foods, for instance.

German firms are particularly worried about a loss of business in America. Last week, the American Chamber of Commerce in Germany celebrated its 100th anniversary. In between the champagne and canapés there was much talk that the political rift between the two countries could harm commercial links. A few American congressmen have already called for restrictions to be imposed on the import of European wine, cheese and military equipment.

There is also talk that American firms might shift their future investments from “old Europe”—France and Germany—into “new European” countries—such as Britain. More realistically, however, Germany and France are already seen as hostile business environments because of their high labour costs and taxes, and their rigid markets. To some extent, the political rift is just another excuse.

What is clear, however, is that the spat over Iraq will not help to speed up trade negotiations in the Doha round, which already seem to be heading for gridlock. Last weekend, trade ministers meeting in Tokyo made almost no progress towards liberalising farm trade. Yet agriculture is the central issue for the Doha round. Failure to liberalise farm trade would be a big blow to the poor world. Even worse would be an associated tit-for-tat trade battle between the rich.

• “The Economic Consequences of a War with Iraq”. American Academy of Arts and Sciences, December 2002. Available at www.amacad.org/publications /monographs/War_with_Iraq.pdf (see chapter three)

yellowtimes.org Printed on Wednesday, February 19, 2003 @ 15:07:08 EST   ( ) By Paul Harris YellowTimes.org Columnist (Canada)

(YellowTimes.org) – There are many reasons for George Bush's single-minded drive toward Baghdad. In other articles I have written for YellowTimes.org, I hinted that a not so obvious reason for the drive against Iraq is Bush's war against Europe. In fact, I have now come to believe that is the primary reason for his Iraqophenia.

Whenever a nation decides to go to war, there are plans made for who is going to win and who is going to lose; no one goes to war expecting to lose, but it isn't always the obvious target of the aggression that is the real thrust behind the war. Sometimes, it isn't a case of what you expect to win from a war, but rather a case of what you hope someone else loses; and it doesn't have to be your stated enemy who you hope will sustain the losses. In this case, Bush's hoped-for victim is the European economy. It is robust, and is likely to become much stronger in the easily foreseeable future. Britain's entry into the European Union is inevitable; Scandinavia will join sooner rather than later. Already, even without those countries, there will be 10 new member nations in May 2004, which will swell the GDP of the E.U. to about $9.6 trillion with 450 million people as against $10.5 trillion and 280 million people in the United States. This represents a formidable competing block for the United States but the situation is significantly more complex than what is revealed just by those numbers. And much of it hinges on the future of Iraq.

I have written before, as have many others, that this upcoming war is about oil. To be sure there are other reasons, but oil is the single most impelling force. Not in the way you might expect, however. It isn't so much that there are believed to be huge untapped oil reserves in Iraq, untapped only due to outdated technology; it isn't so much an American desire to get its grubby hands on that oil; it is much more a question of whose grubby hands the Americans want to keep it out of.

What precipitated all of this was not September 11, nor a sudden realization that Saddam was still a nasty guy, nor just the change in leadership in the United States. What precipitated it was Iraq's November 6, 2000 switch to the euro as the currency for its oil transactions. At the time of the switch, it might have seemed daft that Iraq was giving up such a lot of oil revenue to make a political statement. But that political statement has been made and the steady depreciation of the dollar against the euro since then means that Iraq has derived good profits from switching its reserve and transaction currencies. The euro has gained about 17 percent against the dollar since that time, which also applies to the $10 billion held in Iraq's United Nations "oil for food" reserve fund.

So the question arises, as it did for George Bush, what happens if OPEC makes a sudden switch to euros? In a nutshell, all hell breaks loose.

At the end of World War II, an agreement was reached at the Bretton Woods Conference which pegged the value of gold at $35 per ounce and that became the international standard against which currency was measured. But in 1971, Richard Nixon took the dollar off the gold standard and ever since, the dollar has been the most important global monetary instrument, and only the United States can produce them. The dollar, now a fiat currency, is at a 16-year trade-weighted high despite record U.S. current-account deficits and the status of the U.S. as the leading debtor nation. The U.S. national debt as of April 4, 2002 was $6.021 trillion against GDP of $9 trillion.

Trade between nations has become a cycle in which the U.S. produces dollars and the rest of the world produces things that dollars can buy. Nations no longer trade to capture comparative advantage but rather to capture needed dollars to service dollar-denominated foreign debts and to accumulate dollar reserves in order to sustain the exchange value of their domestic currencies. In an effort to prevent speculative and potentially harmful attacks on their currencies, those nations' central banks must acquire and hold dollar reserves in amounts corresponding to their own currencies in circulation. This creates a built-in support for a strong dollar that in turn forces the world's central banks to acquire and hold even more dollar reserves, making the dollar stronger still.

This phenomenon is known as "dollar hegemony," which is created by the geopolitically constructed peculiarity that critical commodities, most notably oil, are denominated in dollars. Everyone accepts dollars because dollars can buy oil.

The reality is that the strength of the dollar since 1945 rests on being the international reserve currency for global oil transactions (i.e., "petro-dollar"). The U.S. prints hundreds of billions of these fiat petro-dollars, which are then used by nation states to purchase oil and energy from OPEC producers (except presently Iraq and, to some degree, Venezuela). These petro-dollars are then re-cycled from OPEC back into the U.S. via Treasury Bills or other dollar-denominated assets such as U.S. stocks, real estate, etc. The recycling of petro-dollars is the price the U.S. has extracted since 1973 from oil-producing countries for U.S. tolerance of the oil-exporting cartel.

Dollar reserves must be invested in U.S. assets which produces a capital-accounts surplus for the U.S. economy. Despite poor market performance during the past year, U.S. stock valuation is still at a 25-year high and trading at a 56 percent premium compared with emerging markets. The U.S. capital-account surplus finances the U.S. trade deficit.

Since it is the U.S. that prints the petro-dollars, they control the flow of oil. Period. When oil is denominated in dollars through U.S. state action and the dollar is the only fiat currency for trading in oil, an argument can be made that the U.S. essentially owns the world's oil for free.

So what happens if OPEC as a group decides to follow Iraq's lead and suddenly begins trading oil on the euro standard? Economic meltdown. Oil-consuming nations would have to flush dollars out of their central bank reserves and replace them with euros. The dollar would crash in value and the consequences would be those one could expect from any currency collapse and massive inflation (think of Argentina for an easy example). Foreign funds would stream out of U.S. stock markets and dollar denominated assets; there would be a run on the banks much like the 1930s; the current account deficit would become unserviceable; the budget deficit would go into default; and so on.

And that's just in the United States. Japan would be particularly hard hit because of total dependence on foreign oil and incredible sensitivity to the U.S. dollar. If Japan's economy tumbles, so does that of many other countries, especially the United States in a crescendo of dominos.

Now, this is the potential effect of a "sudden" switch to euros. A more gradual shift might be manageable but even that would change the financial and political balance of the world. Given the size of the European market, its population, its need for oil (it actually imports more oil than the U.S.), it may be rapidly approaching that the euro will become the de facto monetary standard for the world.

There are some good reasons for OPEC as a group to follow Iraq and begin to value oil in euros. There seems little doubt that they would relish the opportunity to make a political statement after years of having to kowtow to the U.S., but there are solid economic reasons as well.

The mighty dollar has reigned supreme since 1945, and in the last few years has gained even more ground with the economic dominance of the United States. By the late 1990s, more than four-fifths of all foreign exchange transactions, and half of all world exports, were denominated in dollars. In addition, U.S. currency accounts for about two thirds of all official exchange reserves. The world's dependency on U.S. dollars to pay for trade has seen countries bound to dollar reserves, which are disproportionately higher than America's share of global output.

It is important to note that the euro is not at any disadvantage versus the dollar when one compares the relative sizes of the economies involved, especially given the E.U. enlargement plans. Moreover, the E.U. has a bigger share of global trade than the U.S. and while the U.S. has a huge current account deficit, the E.U. has a more balanced external accounts position. One of the more compelling arguments for keeping oil pricing and payments in dollars has been that the U.S. remains a large importer of oil, despite being a substantial producer itself. But the EU is an even larger importer of oil and petroleum products than the U.S., and represents for OPEC a more attractive market, closer and less domineering.

The point of Bush's war against Iraq, therefore, is to secure control of those oil fields and revert their valuation to dollars, then to increase production exponentially, forcing prices to drop. Finally, the point of Bush's war is to threaten significant action against any of the oil producers who would switch to the euro.

In the long run, then, it is not really Saddam who is the target; it is the euro and, therefore, Europe. There is no way the United States will sit by idly and let those upstart Europeans take charge of their own fate, let alone of the world's finances.

Of course, all of this depends on Bush's insane plan not becoming the trigger for a Third World War, as it so readily might.

[Paul Harris is self-employed as a consultant providing Canadian businesses with the tools and expertise to successfully reintegrate their sick or injured employees into the workplace. He has traveled extensively in what we arrogant North Americans refer to as "the Third World," and he believes that life is very much like a sewer: what you get out of it depends on what you put into it. Paul lives in Canada.]

Paul Harris encourages your comments: pharris@YellowTimes.org

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www.brainboxmag.com War

With the war drums pounding, the rhetoric rising, and the testosterone boiling, let us take a step off of the brink and examine what we are about to do in Iraq. We should take a look at our actions using greater hindsight to achieve better foresight. We are about to go to war, and I believe in the era of computers, much of America sees this decision as somewhat trivial. They are apt to go along with Bush, satisfied with the President’s labeling of Saddam as evil. So let us look deeper into the situation, and I hope to illustrate the dire state of American diplomacy. I will grant to the advocates of war, for the time being, that we are poised to invade Iraq not for oil (read Bill’s UN), but rather for the two reasons given by Bush. First, and most importantly, Iraq must be disarmed. Secondly and much more infrequently noted, Saddam is an evil dictator, and we must liberate the nation. Let us look at these reasons. Iraq poses no imminent threat on the United States or any other country. Links to Al-Qaeda are extremely weak, if they exist at all. Osama bin Laden and Saddam Husein would probably kill each other if they were in the same room. Osama has frequently called the secular Hussein an “infidel.” Not only do they ideologically stand opposed, but furthermore, Saddam, who by all accounts is a somewhat intelligent guy, would be utterly stupid to try to make connections with any terrorists. He knows that the day he is concretely connected to a terrorist attack on American soil is the day he not only loses all his luxurious palaces but also is the day he is blown to smithereens. He knows he cannot use any of his biological and chemical weapons for terrorism, because American intelligence could easily track it back to him. Yes, I admit he does have biological and chemical weapons. We gave them to him, back when he was our ally, back when we helped him, when it was politically convenient to support this dictator. Currently, Saddam is isolated and weakened militarily. He shows no sign of invading another country. Even Bush acknowledged in his State of the Union that he did not pose an imminent threat. Rather, Bush sees the need for a pre-emptive strike. I am not sure though whether most Americans understand the gravity of those words. The United States has never gone into war pre-emotively. We have always justified our acts by claiming that we, or some other innocents, were attacked first. The War of 1812 was justified by, among other things, the impressment of American sailors by the British. The Mexican War was justified by leading American troops into disputed territory, where they were attacked by the Mexicans. The Spanish-American War was justified through the sinking of the Maine Battleship in Havana. The First World War was justified by the belligerent acts of Germany, including the sinking of the cruise ship Lusitania. The Second World War was justified by Pearl Harbor. The Korean War was justified by the invasion of South Korea. The Vietnam War was justified by the Gulf of Tonkin incident. No matter how much these justifications obscured the real causes of the war, the defensive justifications were still present. Indeed, they were needed to quench the moral questions of the American public. Not so presently with Iraq. The President, and some advocates for war, have argued that it is a different world, and the United States must act first, even if it never has before. If it has changed, is war the answer to this change? We had planes that could have been hijacked and flown into buildings thirty years ago. Yet, it did not happen. Why? There was not such a burning desire, or the resources, to do so amongst terrorists. What changed that? Actually, I’m glad you asked. It was the first Gulf War that pushed Osama over the ledge. He was so angered by the stationing of American troops in Saudi Arabia, that he got up and left, taking his millions to aid in a new terrorist war against America. Saddam has had biological and chemical weapons for years now. The last time he used them in a belligerent act? During the Gulf War. I believe a pattern might be emerging. As stated above, Saddam currently lies castrated. Even if he wanted to smuggle some weapons to Al-Qaeda, he could not, because he is not self-destructive. With regard to terrorism, the only thing this war guarantees is in fact more of it. If we do invade Iraq, Saddam will make allies out of necessity with all enemies of the United States. This means aiding terrorists. Moreover, when we invade Iraq we threaten to make a martyr out of Saddam for the entire Arab world. Previously disliked by most fundamentalist Arabs as a secular dictator, he is fast becoming a hero for standing against the Americans. The war would also be destructive in the conventional, non-terrorist, sense. If we do invade Iraq, it will destabilize the whole region, sending refugees everywhere. Those civilians who will not be killed by American bombs will wallow in disease-ridden refugee camps. Furthermore, if Saddam knows he will be destroyed by America, might not he send an anthrax laden scud missile into Tel-Aviv, or somehow attempt to stir up Arab support in Palestine and Syria against Israel. And then what is stopping Israel from becoming involved in a war with Syria, Palestine, and Iraq, not to mention the people of Egypt and Jordan who may threaten to rise up against their more Western-friendly leaders? The Third World War might become reality. Much of this is probably more unlikely than likely, but why risk it? The point is that we see war as such a clean thing, which it will never be. The Middle-East, especially, is not a place to make war lightly. This said, I do not support Saddam Hussein as the leader of Iraq. I might even be willing to listen to plans for war if I thought liberating the people of Iraq was of top priority. After the war the Iraqi people will be as quickly forgotten as the Afghani people were. Unless we are willing to invest billions of dollars into creating an egalitarian society, the way did after the Second World War in Europe and Japan, the Iraqi people will be no better off under a Western-friendly regime. Just look at one of Iraq’s neighbors Saudi Arabia, where the gap between rich and poor is astounding and where, despite (maybe a better word is because of), the pro-American government, Al-Qaeda finds many willing recruits. Most of the hijackers on 9/11 were Saudis and Egyptians, countries with pro-American governments. None were Iraqi. If we go to war, the next 9/11 will most probably involve Iraqis. Make no mistake, this war has nothing to do with the Iraqi people. After the war, the benefits of oil production will not go to them, for in none of the Western-friendly oil-producing countries do oil riches go to the people (e.g. Saudi Arabia, Nigeria, Venezuela). I believe the war has everything to do with satisfying the American appetite for oil, but even if it does not, even if it is about the cause most oft repeated by our President, to rid the world of the evil Saddam Hussein with his evil weapons, we are at a turning point in American diplomacy, one that historians will certainly look back at with dismay. It will be the day testosterone-bursting war hawks will no longer need the veil of an imminent threat to satisfy their craving for blood.

• Anthony

On why we should know better than to say this war is for the Iraqi people: From The Boston Review

The Red Perspective is a column exploring current events and issues as they relate to the pursuit of the Socialist ideal. It is almost always written by Anthony Ross, although sometimes by others. Past installments can be viewed here.

www.counterpunch.org February 17, 2003 by JOE QUANDT

Let us have no illusions.

In Baghdad, once I'd gotten to know someone fairly well, they'd often ask me point blank: "The war, Joe... when is it coming?" And searching my eyes, it was clear that they weren't looking for comfort. They wanted the unmitigated truth.

They need, of necessity, to ask these hard questions. The 8-year war with Iran in which 200,000 died; the Gulf War, which took possibly another 300,000 besides wrecking the entire infrastructure; 12 years of U.S.-enforced U.N. sanctions, which have cost them an additional million lives-23 years of sustained economic and military conflict have simply made the Iraqi people immune to illusions, in the matter of war.

Let us, like the Iraqis, have no illusions.

I was in the states at the end of September when the House of Representatives handed the president a gun. I was in Baghdad when the Senate loaded it for him. History repeats itself, as the power to make war is now invested in the person of one, fallible man. Was not the American Revolution fought to prevent a king from making war at his subjects' expense?

As the "Old Europe" of Germany and France makes waffling attempts to assert their independence from Washington realpolitik, Eastern European nations are lining up to take their places at the table. Washington will not lack for lackeys, because power makes money makes power makes money, and this is the first lesson of politics. Have no illusions; other nations will not come to our moral rescue. It may seem ridiculously obvious to you that if the inspectors remained in Iraq for the next 75 years it would still be just plain cheaper than any other solution.

You may be angry at how deeply your civil rights are being slashed at, and recreated in the image of a neo-conservative New World Order.

Or you grasp all too well that it is U.S. arms sales around the world that make inevitable the endless cycle of big and little wars to come, for the next hundred years.

Maybe it's equally clear to you that any future U.S. treaty is a thing of convenience, to be abrogated when its purpose has been served... That the International Criminal Court, the Kyoto Accords, bans on nuclear and conventional weapon testing, research into alternative energy sources, all of these are only impediments to "preserving the American way of life"...

That the War on Terrorism is simply a convenient place to focus American fears now that Communism is dead, and the Pentagon needs a new justification for its ever-expanding budget...

That this war on terrorism, the war in Afghanistan to secure right of way for the natural gas reserves of central Asia, the war for the oil of Iraq, the not-so-coincidental turmoil in Venezuela...these are only the opening gambits in the U.S. bid to secure the fossil fuel resources of the entire planet, in order that we may dictate terms to the rest of the industrialized world.

Ask the shoeshine boys, the art dealers, the doctors, the cafe operators, the hotel staff, ask anyone in Iraq why the United States is coming there. They have no illusions. "It's the oil, we know," they say, shrugging their shoulders as though this is a commonplace, known to every child.

In ancient Assyria, war was not dressed up in Patriotism or the tattered gown of Democracy or a distorted Moral Righteousness fabricated from the loving words of long dead Holy Men. War was an undisguised grab for the wealth of another state, the losers impaled or sold into slavery. And you had to face your "enemy".

Will the government of Pakistan, a nation that possesses nuclear weapons, be destabilized? Will the Israelis use the occasion to push the Palestinians into Jordan? Will Turkey finally move on Iraqi Kurdistan? Will the Shia'a majority of southern Iraq link up with Iran or simply demolish itself in endless revolt against the American invaders? How many more Saudi terrorists will be inspired to action? How long before the New Hiroshima, and what unfortunate land will suffer it?

Hundreds of thousands would die in such a war, but that is academic, an historical footnote, statistics. Lives mean nothing to this administration, yours, mine, or the Iraqis'. Have no illusions.

Dare we note that, should the Iraqis put up a stiff resistance, the American military machine will merely back up, and then, oh my fellow citizens, then we will see a demonstration of Weapons of Mass Destruction such as the world has not previously witnessed.

Debate or forget all of the above, but be assured of one thing: the present crisis is over nothing less than the American Soul.

So why, in a world pitching giantly out of control, would you bother to raise your tiny voice, against a din of violence, waste, fear, greed, and "gut feelings", that seeks to drown out any rational consideration of events? We raise our voices because we are Americans...unlike the Iraqis, we can still raise them. We raise our voices because we have children...and parents...and loved ones...and cherished ideals that we'd like to hang onto, and we realize that everywhere an American bomb falls, an Osama bin Laden seed is sown.

We raise our voices because the right of assembly has not yet been taken from us. We raise our voices because our government's arrogant denial that all the peoples of this planet are beautiful and necessary parts of creation, this arrogance is now attributed to the American people as well, and soon it will be unsafe for us to travel outside of our borders.

We raise our voices because the incontrovertible result of war is more war.

We raise our voices because we have galloping inequities in our schools, in Corporate America, in our inner cities, and the 100 or 200 or 900 billion dollars we would squander on further brutalizing our brothers and sisters in Iraq would be better spent otherwise than in financing the theft of that nation's natural resources, to fill the pockets of the conglomerate that is running this country.

Writing in the early Baghdad evening, I often watched the sun setting over the Tigris River. There, in the Cradle of Civilization, one was, perhaps, more keenly reminded of the flickering and snuffing out of civilizations, and by a small leap, to grasp the historical illogic of war as a problem solving device.

We raise our voices because we must. Because our hearts tell us that the clock is ticking, not quite as loudly as it's ticking for the Iraqis, but time is running out on the American Dream. Have no illusions: An attack against Iraq will be one of the cataclysmic events in American history, on a par with The Civil War and the Great Depression. Would it not signal to the world that democratic principals and Jeffersonian humanism have no more significance in the American ethos than they did in Nazi Germany? And to send that message is to invite a return to international barbarism, but on a scale we must shudder to contemplate.

We raise our voices because there's a drunk at the wheel. Approaching the wall, the catastrophe ever more imminent, we begin to see, with growing and terrible clarity, who and what drives the American State. There is precious little time left in which to grab the keys and avert this self-inflicted disaster.

We raise our voices in the certainty that even should the dreaded Battle of Iraq come, it need not, must not, will not stun us into silence.

And the clock is still ticking...

Joe Quandt is a 52-year old actor/cab driver/activist/teacher/poet living in the Albany, NY area. He traveled to Baghdad on the 49th Voices in the Wilderness delegation, during the month of October, 2002. He can be reached at: Ytonthemoon@aol.com

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