and busy. So here is an offering in lieu of a real post.
And in the end, after you have spent all your money to fill your car at the purposely inflated price and to pay for the inevitable attendant increase in grocery prices, you don’t get your money back. You spent it. It’s gone. Guess who does have your money, be-otch?
On Sunday, a US soldier left his base in Afghanistan and broke down the doors of three homes in nearby villages, killing all the people he found and setting fire to some of the dead bodies. 4 men, 3 women, and 9 children were murdered. The story is shape-shifting daily; at first, reports were of several soldiers, a “group of soldiers, laughing and drunk” as they murdered. Now, US officials claim it was a lone or rogue gunman – one soldier assigned to the Green Berets or the Navy SEALs as part of their “village stability operation”. I do not think he understood the phrase “hearts and minds” quite the same way most do. I am also certain that the Afghans consider him a terrorist and not a “rogue” gunman.
An Afghan man who said his children were killed in the shooting spree accused soldiers of later burning the bodies…Afghan officials also gave varying accounts of the number of shooters involved. Karzai’s office released a statement quoting a villager as saying “American soldiers woke my family up and shot them in the face.”…
“I saw that all 11 of my relatives were killed, including my children and grandchildren,” said a weeping Haji Samad, who said he had left his home a day earlier…
The walls of the house were blood-splattered.
“They (Americans) poured chemicals over their dead bodies and burned them,” Samad told Reuters at the scene.
Neighbors said they had awoken to crackling gunfire from American soldiers, who they described as laughing and drunk. “They were all drunk and shooting all over the place,” said neighbor Agha Lala, who visited one of the homes where killings took place.
“Their (the victims’) bodies were riddled with bullets.”
The White House issued a written statement from President Obama. It read:
“I am deeply saddened by the reported killing and wounding of Afghan civilians. I offer my condolences … This incident is tragic and shocking, and does not represent the exceptional character of our military and the respect that the United States has for the people of Afghanistan. I fully support Secretary Panetta’s and General Allen’s commitment to get the facts as quickly as possible and to hold accountable anyone responsible.”
Why can we never step away from the opportunity to assert that we and our military are “exceptional”? We are exceptional only in the number of countries we have invaded and that we currently bomb. Any war, but especially wars with no reasonable motives and never-defined endpoints, leads to mental instability and cruelty in the soldiers.
Sen. John McCain, the top Republican on the Senate Armed Services Committee, had this to say about the “incident”:
“I understand the frustration, and I understand the anger and the sorrow,” McCain said. “I also understand and we should not forget that the attacks on the United States of America on 9/11 originated in Afghanistan. And if Afghanistan dissolves into a situation where the Taliban were able to take over a chaotic situation, it could easily return to an al-Qaida base for attacks on the United States of America.”
Of course, this is an outright lie. The attacks on 9/11 were carried out in the main by Saudi Arabians, through whatever oversight allowed them in the US. Osama bin Laden was thought to be in Afghanistan briefly and the Taliban agreed to turn him over if the US had actual charges against him related to 9/11. Since there was no actual proof of his involvement, the US never brought any charges and the Taliban refused to lead us to him. The Taliban itself was not our enemy and had nothing to do with 9/11.
Senator Lindsey Graham said:
“No, I believe, one, this is tragic and will be investigated, and that soldier will be held accountable for his actions under the military justice system. Unfortunately, these things happen in war. You had an Israeli soldier kill worshippers by the Dome of the Rock mosque. You just have to push through these things.
“My recommendation to the public is, listen to General Allen, who comes back in two weeks. The surge of forces has really put the Taliban on the defensive… We can win this thing. We can get it right.”
He also obviously views the Taliban as the reason we went into Afghanistan. Now that there is no al Qaeda there, we need a new enemy. But these things happen. We can win this thing. Just stay there forever…..
And Harry Reid remarked:
“Well, of course, our hearts go out to these innocent people. One of our soldiers went into a couple of homes and just killed people at random. Very, very sad, especially following that incident dealing with the Korans, just not a good situation.
“Our troops are under such tremendous pressure in Afghanistan. It’s a war like no other war we’ve been involved in. But no one can condone or make any suggestion that what he did was right because it was absolutely wrong.”
Actually, we have been involved in such wars before, wars of aggression, wars where we invaded for no reason, wars where thousands of innocents were killed and countries destroyed. While we cannot condone such behavior, we usually overlook it. There have even been times we gave medals of honor for just such actions.
This is what happens when we have never-ending wars of conquest for natural resources and economic gain, when the citizens of the country are taught to believe that we can do no wrong and are always justified in every military adventure dreamed up, that nothing we do is ever as horrible as what “the others” do. How is it that whistle-blower Bradley Manning is in prison and facing court marshal while we do not even know the names of the soldiers operating the Apache helicopter and gunning down Iraqi civilians in the tape he allegedly brought to light? Obama claims the right to use military force simply on behalf of our economic interests, not to protect our country from real threat, but to preemptively force economic advantage our way through the use of the Army. Currently there is talk of invading Iran – just on the mere idea that they may be thinking about making a nuclear weapon. Not that they have one, are close to having one, have threatened to use one, or much less, have ever actually used one. We are the only country to have ever used a nuclear bomb. The claim that Japan had to be bombed to force them to surrender is now known to be false (in any case, Hiroshima was not a military target), and there is no rational explanation for the second bomb dropped on Nagasaki. Since that time, seven countries have gone nuclear (Russia, China, India, Pakistan, North Korea, Great Britain and France), and it is widely known that Israel (the unacknowledged eighth country) has nuclear weapons. No-one seriously considered invading any of these countries as a means to preemptively prevent them from developing nuclear capability. Now we casually talk about invading Iran, even though our national intelligence concludes that the Iranians are not seeking to build nukes.
Gradually but steadily, we have all been immersed in the Pentagon’s Long War, which leads us to accept and expect a never-ending war scenario. This is the result. Lindsey Graham is right; “these things happen”. Especially in a citizenry neglecting introspection, disregarded completely in decisions of war and peace, and taught to believe that terrorists lurk behind every fencepost. We have ignored the lessons of war, choosing to think that only our enemies commit the horrible atrocities and yet when, really, have we not had a war going on to learn from? We let the military justify its increasing presence around the globe and always-expanding budget through the only method it has – waging ever more wars. We are creating enemies where there were none, threatening and attacking countries which have offered no harm to us, and forgetting the primary reason to have a military: to protect us when threatened from without, not to create a threat from without. We no longer even use Congress to declare wars. War was never declared against Iraq, Afghanistan, and certainly not Libya. In the case of Iraq and Libya, we labeled the leaders “monsters” – even though we formerly supported them when it was useful – invaded the country, and decimated it. We dropped depleted uranium over both countries, refusing to sign the UN ban on such weaponry. Against Cuba, we have used sanctions as a form of economic warfare for over fifty years, turning against a country once thought our ally because we felt we needed to force our form of capitalism upon it. Haiti has been victim of our interference for an even longer time. In 2004, not content with the damage already done, George W. Bush used the CIA to kidnap their elected President (Aristide) and “exile” him to South Africa. I don’t know why that was not regarded as an overt act of war against Haiti in the eyes of the rest of the world, but Bush managed to perpetrate this act virtually unnoticed even in our own country, in whose name he was acting. (Bush Sr. had instigated the first coup against Aristide in 1991, a military coup led by our CIA.)
Over the years, we have used covert operations against Ecuador, Venezuela, Argentina, Panama, Chile (the list is too long to even enumerate them all) to overthrow or assassinate heads of state in favor of business and financial interests, none of which spread democracy or freedom, but only devastated the citizens of the countries so favored with our attention.
We could have learned from Vietnam. We used napalm and Agent Orange indiscriminately; use of these would have been considered as forms of chemical warfare and terrorism had they been deployed against us or our forces. We thought of them as acceptable forms of warfare. We taught our soldiers that this was the way we did things. How could our servicemen possibly be expected to respect the lives of civilians while spreading such biologicals across the landscape, which continue to poison the population to this day? We chose to financially back and arm the murderous Pol Pot, using the trite rubric that the enemy of my enemy is my friend. One of the best known examples of the crimes our soldiers committed then was the My Lai massacre. Yet, even in the face of irrefutable proof and after having been found guilty, Lt. William Calley was quickly pardoned.
The events in My Lai had initially been covered up by local divisional command. In April 1969, nearly thirteen months after the massacre, a G.I. who had been with the 11th Brigade wrote letters to the President, Chairman of the Joint Chiefs of Staff and the Secretary of Defense. In these letters the G.I. described some of the atrocities by the soldiers at My Lai, that he had been told about.
Calley was charged on September 5, 1969, with six specifications of premeditated murder for the deaths of 104 Vietnamese civilians near the village of My Lai, at a hamlet called Son My, more commonly called My Lai in the U.S. press. As many as 500 villagers, mostly women, children, infants and the elderly, had been systematically killed by American soldiers during a bloody rampage on March 16, 1968. Had he been convicted, Calley could have faced the death penalty…
Calley’s trial started on November 17, 1970. It was the military prosecution’s contention that Calley, in defiance of the rules of engagement, ordered his men to deliberately murder unarmed Vietnamese civilians despite the fact that his men were not under enemy fire at all. Testimony revealed that Calley had ordered the men of 1st Platoon, Company C, 1st Battalion, 20th Infantry of the 23rd Infantry Division (Americal) to kill everyone in the village…
After deliberating for 79 hours, the six-officer jury (five of whom had served in Vietnam) convicted him on March 29, 1971, of the premeditated murder of 22 Vietnamese civilians. On March 31, 1971, Calley was sentenced to life imprisonment and hard labor at Fort Leavenworth…Of the 26 officers and soldiers initially charged for their part in the My Lai Massacre or the subsequent cover-up, only Calley was convicted. Many saw My Lai as a direct result of the military’s attrition strategy with its emphasis on “body counts” and “kill ratios.”…
On April 1, 1971, only a day after Calley was sentenced, U.S. President Richard Nixon ordered him transferred from Leavenworth prison to house arrest at Fort Benning, pending appeal…
Ultimately, Calley served only three and a half years of house arrest in his quarters at Fort Benning… Later in 1974, President Nixon tacitly issued Calley a limited Presidential Pardon. Consequently, his general court-martial conviction and dismissal from the U.S. Army were upheld, however, the prison sentence and subsequent parole obligations were commuted to time served, leaving Calley a free man.
We could clearly see that the Bataan Death March during WW2 was a war crime committed by the Japanese against us, but cannot examine our consciences about the same done by us to others in the Philippine-American war, or in the Trail of Tears during the Indian wars. (The US “relocated” Indians at gunpoint. The Five Civilized Nations underwent at least a 50% mortality rate during these forced marches.)
Certainly we know about the torture methods used by the Filipinos (the “water torture” was a frequent topic of discussion during the Bush administration; in just a few short years, however, we have “forgotten” our objections), who were fighting for their independence from the US during the Philippine-American war, but we seem to have erased from our minds the awful atrocities we unleashed on the Filipinos.
In light of the massive casualties suffered by the civilian population, Filipino historian E. San Juan, Jr., alleges that the death of 1.4 million Filipinos constitutes an act of genocide on the part of the United States.
Atrocities were committed on both sides. United States attacks into the countryside often included scorched earth campaigns in which entire villages were burned and destroyed, the use of torture (water cure) and the concentration of civilians into “protected zones”. In November 1901, the Manila correspondent of the Philadelphia Ledger reported:”The present war is no bloodless, opera bouffe engagement; our men have been relentless, have killed to exterminate men, women, children, prisoners and captives, active insurgents and suspected people from lads of ten up, the idea prevailing that the Filipino as such was little better than a dog.…”
Throughout the entire war American soldiers would write home about the horrors and atrocities which the United States committed in the Philippines. In these letters they would criticize General Otis and the U.S. military; when these letters reached anti-imperialist editors they became national news and forced the War Department to look into their truthfulness.
[An example of]…the letters went as follows:
Corporal Sam Gillis: “We make everyone get into his house by seven p.m., and we only tell a man once. If he refuses we shoot him. We killed over 300 natives the first night. They tried to set the town on fire. If they fire a shot from the house we burn the house down and every house near it, and shoot the natives, so they are pretty quiet in town now.”
However, General Otis’s investigation of the content of these letters consisted of sending a copy of them to the author’s superior and having him force the soldier/author to write a retraction. Then, when a soldier refused to do so, as Private Charles Brenner of the Kansas regiment did, he was, remarkably, court-martialed…
Filipino villagers were forced into concentration camps called reconcentrados which were surrounded by free-fire zones, or in other words “dead zones.” Furthermore, these camps were overcrowded and filled with disease, causing the death rate to be extremely high. Conditions in these “reconcentrados” are generally acknowledged to have been inhumane. Between January and April 1902, 8,350 prisoners of approximately 298,000 died. Some camps incurred death rates as high as 20 percent…In Batangas Province, where General Franklin Bell was responsible for setting up a concentration camp, a correspondent described the operation as “relentless.” General Bell ordered that by December 25, 1901, the entire population of both Batangas Province and Laguna Province had to gather into small areas within the “poblacion” of their respective towns. Barrio families had to bring everything they could carry because anything left behind—including houses, gardens, carts, poultry and animals—was to be burned by the U.S. Army. Anyone found outside the concentration camps was shot…The commandant of one of the camps referred to them as the “suburbs of Hell.”
We had obviously declined to learn anything from the preceding Civil War and the so-called Indian Wars, which officially lasted over 25 years. The State militias had been called up to form the Army for the Civil War. The portion of the Army assigned to General William Tecumseh Sherman was dispatched in 1865 to the West to finally exterminate the Plains Indians in an effort to make way for the railroads. The Indian War had already been going in earnest for some time, with several Army units having been assigned to the West during the Civil War. Sherman was a particularly brutal man who used the word “extermination” frequently in regards to his intentions about the Indians.
We should consider the Indian Wars as an example of what happens when we pursue war simply for economic gain and at the behest of corporations; our interest in the Indian lands was largely driven by the railroad lobby, not (until the media helped whip it up) innate hatred of the Indians by the white settlers. Interestingly, Canada was able to build its transcontinental railway system without resorting to a policy of complete annihilation, and the Plains Indians from the US sometimes sought their refuge by crossing into Canada. Thomas DiLorenzo points out, “It is not true that all whites waged a war of extermination against the Plains Indians. As noted earlier and as noted throughout the literature of the Indian Wars, many whites preferred the continuation of the peaceful trade and relations with Indians that had been the norm during the first half of the 19th Century. (Conflicts sometimes occurred, of course, but “trade” dominated “raid” during that era.)” [see: http://www.consortiumnews.com/2010/100610b.html ]
General Sherman ordered the men under him to “kill without restraint” and assured them that any blow back from the public or the media would be handled by him. That turned out to not be much of a problem, as the media was easily led into a frenzy of anti-Indian sentiment and eagerly seized on each action as justified. In 1867, Sherman wrote in a letter to Ulysses S. Grant (then Commanding General of the Federal Army) that unrestrained slaughter was his plan for the Final Solution to the Indian Problem. He used that exact term on several other occasions and, yes, you read that correctly. “Final Solution” is a phrase more commonly associated with Adolf Hitler; who, it turns out, had quite an early and avid affinity for studying the American west and did indeed base his final solution on the way America handled the Indians.
“Hitler’s concept of concentration camps as well as the practicality of genocide owed much, so he claimed, to his studies of British and United States history. He admired the camps for Boer prisoners in South Africa and for the Indians in the wild West; and often praised to his inner circle the efficiency of America’s extermination—by starvation and uneven combat—of the red savages who could not be tamed by captivity.” John Toland, Adolf Hitler (New York: Doubleday, 1976), p. 802.
Later, Sherman was rewarded for his leadership by being made the Army’s Commander General once Grant became President. The Indian wars were basically a genocide, and the soldiers were allowed to indulge in horrendous actions. Two of the most famous incidents of the time were the Battle of Sand Creek – hardly a “battle” – and Wounded Knee. Sand Creek is described in this excerpt [I have left out the worst parts of the account, which are simply too sickening to be borne]:
As one of Chivington’s guides said, of the 600 or so in the camp at the time of the attack, there were about “thirty-five braves and some old men, about sixty in all” (the remainder being women and children). Chivington had 700 armed soldiers and artillery….
…the Indians were attacked under both the American and white flags [i.e., the Indians were flying both flags themselves, thinking it afforded them protection]…
While the massacre was a source of outrage among many people, despite an investigation by Congress, no real severe penalty was handed out to anyone involved…
‘I went over the ground soon after the battle. I should judge there were between 400 and 500 Indians killed…. Nearly all, men, women, and children were scalped. I saw one woman whose privates had been mutilated.’ – Asbury Bird, Company D of the First Colorado Cavalry
‘The bodies were horribly cut up, skulls broken in a good many; I judge they were broken in after they were killed, as they were shot besides. I do not think I saw any but what was scalped; saw fingers cut off [to take rings] saw several bodies with privates cut off, women as well as men.’ – Sergeant Lucien Palmer, First Cavalry’s Company C…
One last quote, not from a participant:
‘[The Sand Creek Massacre was] as righteous and beneficial a deed as ever took place on the frontier.’ – Theodore Roosevelt
Note the final sentence from this account of Wounded Knee:
December 29, 1890: Big Foot’s band of Minneconjous try to reach Pine Ridge and the protection of Red Cloud after hearing of Sitting Bull’s death. Also present were members of the Sioux band led by Chief Spotted Elk. Hungry and exhausted, they had assembled under armed guard as requested to receive the protection of the Government of the United States of America, surrendering their arms and submitting to a forced search of tents and teepees that yielded but two remaining rifles.
Marched to Wounded Knee Creek, South Dakota, they were disarmed by the U.S. Army. A group of 120 men and 230 women and children were counted by Major Samuel Whitside at sundown on December 28, 1890. The next day an unidentified shot rang out and the well-armed 487 U.S. soldiers ringing the defenseless people opened fire. Afterwards, 256 Sioux lay dead and were buried in mass graves.
Twenty (20) Congressional Medals of Honor were awarded the soldiers.
We so condoned this sort of wholesale slaughter that Medals of Honor were awarded to some of the perpetrators.
General George Custer is famous for his role in the Indian wars. In a sickening little footnote to history, it turns out that Custer liked to have a band to playing an Irish jig called “Garry Owens” during the his attacks on Indian villages; he felt it “gentled” the action and made the killing “more rhythmic”.
We seem to have learned nothing from this history, except that “these things happen”. Today we have a standing army, which we were warned against from the very inception of this country. For example, James Madison said, “… Constant apprehension of War, has the same tendency to render the head too large for the body. A standing military force, with an overgrown Executive will not long be safe companions to liberty. The means of defence against foreign danger, have been always the instruments of tyranny at home. Among the Romans it was a standing maxim to excite a war, whenever a revolt was apprehended. Throughout all Europe, the armies kept up under the pretext of defending, have enslaved the people..” He also wrote, “Of all the enemies to public liberty war is, perhaps, the most to be dreaded, because it comprises and develops the germ of every other. War is the parent of armies; from these proceed debts and taxes; and armies, and debts, and taxes are the known instruments for bringing the many under the domination of the few…No nation could preserve its freedom in the midst of continual warfare.”
Prior to WW2, the US Army was raised for periods of two years at a time. The Continental Congress established the Continental Army in 1775 to fight the revolution. The Legion of the United States was established in 1792- 1796 to fight the Native Americans (which means it was established and renewed once). Congress raised the Army for the War of 1812 and again in 1846 for the Mexican-American War. The state militias were called to form an army for the Civil War and the Indian Wars, which drifted into the 1890’s. The state militias were centralized into the National Guard through the Militia Acts of 1903 and 1908, leading to the National Defense Act of 1916; this latter Act largely created the accepted concept of the standing army we have now. The annual Federal subsidy allocated to the armed forces was replaced with an annual budget and the Guardsmen could be drafted into federal service for the first time. After WW2, and with the onset of the Cold War, the National Security Act of 1947 created the actual working framework for today’s modern military. At first, this was called the National Military Establishment; in 1949, it was renamed the Department of Defense. Today, we have 1.43 million active duty military personnel and 848,000 in reserve components. In other words, we sort of drifted into having a standing army, which now demands the largest portion of our tax monies.
So now we are in a situation where we house soldiers in 800 bases located in 150 different countries. We are drone-bombing six or seven countries and the drones are operated by four separate agencies of the government, at least one of which does not answer to any Commander-in-Chief. The use of drones over American land has been authorized at the same time that the current president has declared he has the right to kill American citizens at his whim. (Which makes his comment today regarding the massacre in Afghanistan all the more, well….interesting: “The United States takes this as seriously as if it was our own citizens, and our children, who were murdered. We’re heartbroken over the loss of innocent life,” Obama said.) This is from the same man who recently had three US citizens living abroad, one of them a teen-aged boy, assassinated.
On that subject, Senate majority leader Harry Reid, a nominal Democrat, said in conversation to CNN’s Candy Crowley on Sunday:
CROWLEY: Right. Let me ask you something about — something the attorney general said recently. He was giving a speech to Northwestern University Law School. And he was suggesting — he said, you know, people are arguing that for some reason the president needs to get permission from a federal court before taking action against a U.S. citizen overseas who’s an operational leader in al Qaeda.
He says that’s just not accurate. That due process and judicial process are not one and the same….Do you have any problem with that? Do you understand what that means exactly?
REID: No, I don’t. But I do know this…the American citizens who have been killed overseas who are terrorists, and, frankly, if anyone in the world deserved to be killed, those three did deserve to be killed.
CROWLEY: And these were the three that were killed in Yemen…are you slightly uncomfortable with the idea that the United States president, whoever it may be, can decide that this or that U.S. citizen living abroad is a threat to national security and kill them?
REID: Well, I don’t know what the attorney general meant by saying that. I’d have to study it a little bit. I’ve never heard that term before. But I think the process is in play. I think it’s one that I think we can live with. And I think with the international war on terror that’s going on now, we’re going to have to make sure that we have the tools to get some of these people who are very bad and comply with American law.
CROWLEY: And you think that the president should be able to make that decision in conjunction with the folks in the administration without going to a court, without going to you all, anything?
REID: There is a war going on. There’s no question about that. He’s the commander-in-chief. And there has been guidelines set. And if he follows those, I think he should be able to do it.
The militarized forces have metamorphosed us into a society that accepts as natural preemptive wars without Congressional votes, “spy on your neighbor” programs, the whole-of-government approach to terrorism (where every agency in the gov’t aids in the search for suspects in the US), police forces equipped with military hardware, new laws restricting protest, intrusive scans while traveling, government eavesdropping of phone calls and internet use, the indefinite detention of US citizens, and even the assassination of anyone, anywhere in the world at the president’s direction. Somewhere in the neighborhood of one million Americans are now on the “terror watch lists”.
It is time and beyond time to face who we are and how we got here. It is time to learn for once and all the lessons we neglected to study in all these years. Atrocities such as the massacre in Afghanistan over the weekend do not need to just “happen”.
It is time to have an end of this forever war.
Morris Berman was recently interviewed by Nomi Prins. If you are not familiar with him, he has just published the third book in his Dark Ages America series, “Why America Failed”.
He is the also the author of a trilogy on the evolution of human consciousness– “The Reenchantment of the World” (1981), “Coming to Our Senses” (1989), and “Wandering God: A Study in Nomadic Spirituality” (2000). I highly recommend all of his books. He is a truth-teller in an age of lies. His website is: http://morrisberman.blogspot.com/ If you enjoy a good conversation, read his comment sections and join in.
From the interview, “Why the American Empire Was Destined to Collapse” with Prins:
Berman: “There is a story, probably apocryphal, of a Native American scouting expedition that came across the starving members of the Donner Party in 1847, who were snowbound in the Sierra Nevadas and resorted to cannibalism in order to survive. The expedition, which had never seen white people before, observed the Donner Party from a distance, then returned to base camp to report what they had seen. The report consisted of four words: ‘They eat each other.’ Frankly, if I could summarize the argument of Why America Failed in a single phrase, this would be it. Unless Occupy Wall Street (or some other sociopolitical movement) manages to turn things around in a fundamental way, ‘They ate each other’ will be our epitaph.”
Look at those gas prices go! Depending on where you get your news, gas prices are leaping, inching, crawling, surging, climbing, or soaring. It’s as though gas prices are some new autonomous genera of animal acting of their own volition. Genus Oleum pretium (gas prices); sub-species: normalis (regular), medius (mid-grade), superfluo (super), and diesel (maxius taxius? Sorry, no Latin for diesel). Gas prices seem to have raised themselves 50 cents per gallon since the first of Jan. No-one else is taking the blame, so they must have done it alone. Nasty creatures, oleum pretium.
Gas prices at the pumps are obviously related to oil prices. On the Brent market, oil, which was $80/barrel just 4 months ago, is now hitting over $120/barrel. The Brent is important because that is the market which sets prices for gasoline in the US and most of the Eurozone. It is rather funny how, just when the price per barrel was heading downwards because of weakening demand, a reason to inflate prices suddenly appeared. It’s almost mysterious.
Perhaps the oil companies were losing money and had to increase prices. (Snort.) The five largest oil companies made 137 billion in profit last year (that’s profit after expenses); in the past decade, they have made 1 trillion in profits. There is no doubt that in April, when the first quarter’s reports come out, we will hear that Exxon made record profits – again. Every quarter is a record quarter for Exxon.
Maybe it is high demand causing the rise in prices. I have seen that postulated in a variety of places. Yet demand is actually down, both in the US and globally. China’s demand was blamed for the ’08 increase, but now their economy is beginning to get a little shaky and their oil demand growth is slowing. Can’t blame it all on China this time.
Is it a supply problem? No. US supply levels remain fairly constant. As a matter of fact, we have enough of a supply that we are now a net exporter. We produce roughly 8 million barrels of oil a day as it is, and Obama opens new areas for exploration and drilling every day. No tree-hugger, that guy. It should be patently obvious that if we are a net exporter, there is no need to allow speculative drilling companies to tear up our country, use up our fresh water, and destroy our oceans. At some point, we need to realize that having clean water, arable clean land, and edible fish is a bit more important than destroying everything based on somebody’s guess about where oil is.
Right now, it is estimated that we might have enough oil in the ground to continue producing for about ten years if we keep on at the same rate. The only result of digging it up and using it up faster – which demand levels indicate is unnecessary – will be to run out that much sooner. And as I pointed out in my post of 15 Jan, “Bakkan, Keystone XL, and Fracking”, the amount of oil and natural gas thought to be under US ground is based on pure speculative guesses from the oil companies looking for new drilling leases. Take the time to read the linked article in the following if you haven’t done so already:
In a sadly overlooked article in the NYT (June, ’11) by Ian Urbina, industry insiders admit they have no idea how much oil and gas are in the shale formations and doubt that extracting the fuels will end up being cost efficient. If you take the time to read the entire article (please do – it is amazing what the industry insiders acknowledge to each other), you will view fracking in a whole new light. You might even want to look into green energy, mass transit, and other such assorted non-fossil-fuel alternatives. – Teri
Quoted article: Natural gas companies have been placing enormous bets on the wells they are drilling, saying they will deliver big profits and provide a vast new source of energy for the United States.
But the gas may not be as easy and cheap to extract from shale formations deep underground as the companies are saying, according to hundreds of industry e-mails and internal documents and an analysis of data from thousands of wells.
In the e-mails, energy executives, industry lawyers, state geologists and market analysts voice skepticism about lofty forecasts and question whether companies are intentionally, and even illegally, overstating the productivity of their wells and the size of their reserves. Many of these e-mails also suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles.
“Money is pouring in” from investors even though shale gas is “inherently unprofitable,” an analyst from PNC Wealth Management, an investment company, wrote to a contractor in a February e-mail. “Reminds you of dot-coms.”
“The word in the world of independents is that the shale plays are just giant Ponzi schemes and the economics just do not work,” an analyst from IHS Drilling Data, an energy research company, wrote in an e-mail on Aug. 28, 2009.
Company data for more than 10,000 wells in three major shale gas formations raise further questions about the industry’s prospects….
As I thought we would, we are again hearing about how we must fast-track the Keystone XL pipeline. The southern leg of this boondoggle is a go (which Obama “welcomes”). Ah, the Keystone. Such a deal. Dirty tar sands oil from Canada, dug up by a Canadian company, running through a pipeline built by Canadian employees, going to refineries in Texas where the diesel will be sold on the open market.
Already, U.S. refineries are exporting records amounts of the gasoline they make. For the first time in 62 years, America is now a net petroleum exporter. Valero Energy Corp., the largest U.S. exporter of refined petroleum products, is a major lobbyist for Keystone XL. Along with Motiva (an oil refiner jointly owned by Shell and Saudi Aramco) and Total (a French refinery), Valero has signed secret, long-term contracts with Keystone’s owner (TransCanada Corp.) and several tar sands oil producers to bring this crude to Port Arthur, Texas. All three have upgraded their refineries there to process diesel for export.
Adding to Big Oil’s enjoyment is the fact that the Port Arthur refineries of Valero, Motiva and Total are within a Foreign Trade Zone, giving them special tax breaks for shipping gasoline and diesel out of our country. And adding to the dismay of some U.S. consumers, TransCanada has quietly boasted that Keystone XL would cut gasoline supplies in our Midwestern states, thus raising prices at the pump and siphoning more billions of dollars a year from consumers’ pockets into the vaults of multinational oil interests.
In a pinch, Saudi Arabia will always rescue us, right? They’ll shore up our supplies; they are our friends. Except that Saudi Arabia’s reserves are falling 3% a year and they really want oil prices to keep going up.
So why are the gas prices leaping about? Three reasons: speculators, the tension with Iran (which is part of what is driving the speculation), and because the oil companies want more money. One minor thing was that the oil companies just lost their ethanol subsidy, and this immediately raised prices at the pumps on 1 Jan. Hey, why should they endure any loss of profit at all? Even if it does mean that the consumer will get hit with higher food and energy prices as well, which are affected by gasoline and diesel costs. (Even without the subsidy, these guys make out okay on the ethanol switcharoo – adding ethanol reduces your gas mileage by about three miles per gallon so that you have to go fill up more often than you would if the gas were ethanol-free. Great stuff.) Truth is, they simply want money. A lot of it. They will raise prices whenever they want. As one of my Southern cousins would say to emphasize a point or mark agreement, “Tell you what!”
Speculation in the markets is the same sort of crap that got us in trouble with the housing market, but this time they are wreaking havoc with the commodities markets. It’s the same players though – Goldman, Sachs et al. They managed to get a few loopholes quietly opened for speculation in the commodities markets – loopholes that exist for only a few very specific companies – and were allowed to create a new form of investment called index speculation. They are screwing with the markets in brand new complicated ways and have completely thrown out the traditional role that speculators used to play, which was to provide a place for the producers and buyers of actual physical products to buy or sell their goods.
Equally important is the role of Wall Street financial speculators. According to the Commodity Futures Trading Commission, which regulates energy trading, the proportion of oil trades made by pure speculators—those who never take actual possession of the oil, but are simply betting on the price—has shifted in the last five years from 30 percent to nearly 70 percent of the total.
CFTC Commissioner Bart Chilton told ABC News that the “speculative premium” on oil was about $23 a barrel, or 56 cents for a gallon of gas. This vast sum goes straight into the pockets of the same Wall Street firms that crashed the world economy in 2008 through speculation in real estate mortgages and were bailed out by the Bush and Obama administrations.
“Speculation is now part of the DNA of oil prices. You cannot separate the two anymore. There is no demarcation,” Oppenheimer & Co analyst Fadel Gheit tells McClatchy News. “I still remain convinced oil prices are inflated.”
Carl Larry of Oil Outlooks and Opinions adds in a recent report that if Iran stops exporting altogether, crude market prices are estimated to hit around $130 a barrel in the immediate aftermath. Although the response would be the result of fear-induced speculation, the consequences could be catastrophic as the western world continues to teeter towards default.
“It is important to emphasize that a spike in oil prices would most likely inflict damage on the economic recovery,” Goldman Sachs say in their own just-published report. They expect crude to rise to $123.50 a barrel within 2012. [My note: As is usual with Goldman, Sachs “prophecies”, which somehow are unerringly accurate when it comes to predicting which funds are going to pay off, we see that they called this correctly. Brent crude is 123/barrel today. How do they do that?]
Speculators are working off the rising tensions with Iran. Tension, it must be noted, that we and Israel craftily created ourselves. Iran hasn’t actually done anything that was not a response to something we did first. We – or at least our media outlets, and at some point you better start trying to figure out who they really work for – claim that they are trying to create a nuclear bomb, yet this is not what the IAEA has found and not what our own generals think. Iran is enriching uranium to 3.5%; a nuclear bomb needs 95%. We began sanctions on Iran to get them to stop doing something they are not doing. We then got the Eurozone to sanction Iranian oil (although those sanctions don’t begin in earnest until 1 July); just the threat of all these sanctions and embargoes has ramped up speculation in the markets. My goodness, it was just in January that a US Treasury official (named “Anonymous”, the most frequently heard family name in American politics) claimed that the sanctions would not disrupt the global markets in any way. Iran then said it will cut off oil deliveries to Europe peremptorily themselves, which seems a fairly reasonable response to the economic war we have already begun against them. Most countries around the globe don’t care if Iran has a nuclear weapon, by the way, and find that the US and Israel are the greatest threats to world peace today. Hell, until a year or two ago, most Americans didn’t care if Iran had a nuke.
So here we are, sanctioning and embargoing a country, deliberately trying to drive its people into poverty (still talking about Iran here, though you might sensibly begin to wonder about the true target), which another member of the Anonymous family admitted the other day – and the results are: some European countries may lose a significant source of oil, gas prices in Europe and the US are sky-rocketing, and a whole bunch of other countries (there are other countries out there – you know that, right?) are going off the petrodollar. The big oil companies and too-big-to-fail banks are making out like bandits, as usual. The American “recovery” may well be smothered in its infancy, as gas prices are followed inevitably by upticks in food and energy costs. High oil and gas prices have preceded every recession since the 70’s. Well, this will sure teach those Iranians a thing or two….oh, wait. Who is being taught a lesson here? I mean, think about it. When you take a look at who is being affected by the Hate On Iran campaign, check out your last grocery bill or your last gas station receipt. And your new little part-time job is not going to cover the bills as they continue to rise. Actually, you may not have that job too much longer. Any company that dared to start hiring recently may quickly find that they need to lay off workers again very soon, as their costs increase. Just wait until March 20, when the Tehran bourse starts trading in other currencies besides the dollar, if you think gas prices are high now. And, by the way, has it occurred to anyone that Iran is ironically helped by rising oil prices? The funds they lose by the sanctions are partially replaced by the fact that the oil they do sell is bringing in higher prices. And quite a few countries have declined to mess up their own economies or trading relationships by going along with the insane US/Israel “plan”; Iran will continue to sell its oil.
And our leaders are doing this knowingly. They absolutely understand what is happening to commodity prices. Why are they doing this? Just to show support for Israel in its weird obsession with Iran, an obsession they have managed to entangle us in? Iran has not threatened the US. The US is daily threatening Iran. Factually, Iran has not even threatened Israel. Look, Israel is not part of the US. If they want to go after Iran for some strange reason, have at it. Knock your freaking socks off. There is no sensible reason for us to allow ourselves to be duped into fighting a proxy war for them, a war that would be another trillion-dollar hole in our bucket, a war that would be yet another illegal, baseless war of aggression on a country which has caused us no harm and threatened us in no way. In fact, the whole thing makes so little sense that one might wonder if there is more to all this than the Israel-first lobby testing exactly how far out on that limb they can shove us.
As our media obediently whips up the hate for, and fear of, Iran, they also prepare us for further gas price shocks. “$5 a gallon gas by summer?” the headlines ask. You read the articles and are given no good insights into the why of it all, just some nonsense about “summer prices arriving early”. Oleum pretium did not see his shadow this year and has crept out early. But the point of these articles is not to teach you about index speculation or the profits of commodities traders or even to point out that someone is making some kinda serious dough off all the cavorting around that gas prices are doing. The media is doing its job and doing it well. They are softening up the mark. It all becomes a self-fulfilling prophecy, and we are being prepared to accept our fate. We are the mark. We ought to make some effort to find out who the grifters are.