The 21 st Century

Oil Wars

joseph tiraco


F rom the incorporation of Standard Oil (New Jersey) in 1899 to President Clinton’s embargo of Iranian oil in 2000, the 20 th Century was the Oil Century, steeped in oil politics from beginning to end. Over the course of the Century, 170 billion barrels of domestic petroleum was pumped out of the ground. The United States, to fuel its economic engine for the year 2001, consumed seven billion barrels of oil (or 1000 gallons per capita.) The entire world, in the same period, consumed about 22 billion barrels of oil. Young and vibrant, the Oil Century was magnificent to behold, a time of wonders, but production in the United States is now a thing of the past; peaking in the early ‘70s (at 3 ½ billion barrels for 1970), and in steady decline ever since. America now has about three years of current consumption still in the ground as a reserve; however, removal of the oil is subject to certain limiting factors, and only two billion barrels of domestic oil could be pumped in 2001, while five billion barrels were imported. The amount of domestic oil produced will continue to fall until complete oil depletion is reached around mid-century. North America has consumed most of its oil; the Middle East has most of what is left. Even though the depletion of American oil is an impending fact of life, oil companies pretend the actual end point is centuries in the future,

“The oil companies are not going to keep rigs employed to drill dry holes. They know it but are unable and willing to admit it. The great merger mania is nothing more than a scaling down of a dying industry in recognition that 90% of global conventional oil has already been found" (Goldman Sachs - August 1999)


T he year 2001 saw oil bounce off the international production ceiling. That is, for the first time, world consumption, increasing at an annual rate of two percent since 1900, could not be sustained by the sum of world production. In short, the pedal was to the metal - all the world’s economic engines were running flat out and they stalled at a level below the two percent growth rate, starved for oil. The mechanism that slowed the world economy and brought the engines back into balance was soaring oil prices and world recession; too many dollars chasing too few barrels of oil , a scenario that is expected to play itself out again and again whenever oil consumption hits the production ceiling. That’s the good news! And the bad news: Mideast oil production is expected to peak by 2010 - if it has not already peaked in ‘01. The World economy has reached its zenith, the current oil based model is fully matured, and as long as oil remains the world’s main source of energy, the aggregate of all the economic engines on earth are as strong as they will ever get. The long, slow decline of Mideast oil production and the commensurate world economic slowdown will continue throughout the rest of this century; the world economy continually bouncing off the sloping production ceiling and slowing down in ever deeper recessions, brought on by oil shortages, and ever steeper increases in oil prices. In the abstract, nations with privileged access to oil reserves could power their economies to the max and enjoy prosperity, while the rest of the world contends for the remaining oil and accepts partial prosperity. At least, that is the brute-strength theory. But technology has brought an emergent world of complex interdependency that is rapidly shaping a mass of one great people - the single state of Humankind . Whether or not any division can sever from the body and prosper in isolation is doubtful. We’re all in the same boat has never been truer then in the 21 st Century.


P olitical disturbances resulting from the decline of world oil production and the inevitable attempt to secure what is left by military means, could make the 21 st Century far more violent then the last with its 100 million souls extinguished by war and political purges.


T he certain knowledge that world oil depletion would arrive in the 21 st Century - vividly brought to light by the oil shock of the 1970s - actuated vigorous government planning. The national think tanks, whose science teams brought forth marvels - the Manhattan Project, integrated circuits, space travel - with mundane regularity, had a 30 year window of opportunity as the design and implementation period. The following is extracted from a timeline found on the U.S. Department Of Energy website and relevant to the subject at hand.

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         May 7, 1974 President Nixon signs the Federal Administration Act of 1974. The Federal Energy Administration replaces the Federal Energy Office.

(President Nixon proposes 10 billion dollars for Project Independence to achieve energy self-sufficiency by 1980.)

         October 11, 1974 President Ford signs the Energy Reorganization Act of 1974. The Atomic Energy Commission is abolished. The Energy Research and Development Administration, Nuclear Regulatory Commission, and Energy Resources Council are established.

         August 4, 1977 President Carter signs the Department of Energy Organization Act. The Federal Energy Administration and Energy Research and Development Administration are abolished.

         July 15, 1979 President Carter declares energy to be the immediate test of ability to unite the Nation and proposes $88 billion decade-long effort to enhance production of synthetic fuels from coal and shale oil reserves.

         March 17, 1987 President Reagan's Energy Security Report outlines the Nation's increasing dependence on foreign oil.

         July 26, 1989 President Bush directs the Department (DOE) to develop a comprehensive national energy policy plan.

         October 1992 President Bush signs the Energy Policy Act of 1992, which assists the implementation of the National Energy Strategy.

         November 3, 1992 William Jefferson Clinton is elected president.

         January 22, 1993 Hazel R. O'Leary is sworn in as seventh Secretary of Energy.

         March 12, 1997 Federico F. Pe–a is sworn in as eighth Secretary of Energy.              

         August 18, 1998 Bill Richardson is sworn in as ninth Secretary of Energy.


A chart to illustrate the above great moments in America’s energy policy, looking like a football schematic for the old razzle-dazzle play, is also on the DOE website . At any rate, the world can live without oil, but not without energy. The time to unveil the momentous plan has arrived; oil consumption hit the production ceiling in ‘01, Mideast oil is about to peek and the production declivity is upon us - as is the first of the predicted reoccurring economic recessions. The smooth transition from oil to something else should have begun. Where’s the plan?


M ajor General Smedley Darlington Butler served as a Marine Corps officer during the heyday of gunboat diplomacy. For most of his career (1900-1933) he was the president’s iron fist, commander of American expeditionary forces, and often, the sole instrument of U.S. foreign policy. He came under enemy fire 120 times, and was one of four Americans to ever win two Congressional Medals Of Honor. Like the famous painter standing on the mountain top to better view his subject in the valley, the good general climbed to the summit of selfless love of country, and peered down into the dark heart of American politics. It repulsed him, and he spent his retirement years writing and speaking about his experience, and decrying the evils of “ Interventionism .”

  “I spent thirty- three years and four months in active military service as a member of this country's most agile military force, the Marine Corps. I served in all commissioned ranks from Second Lieutenant to Major-General. And during that period, I spent most of my time being a high class muscle- man for Big Business, for Wall Street and for the Bankers. In short, I was a racketeer, a gangster for capitalism.”

              He saw firsthand the streak of barbarity exposed in the pursuit of self interest by America’s most successful capitalists; war is a somber business, and the general reviled his role as proxy for the day to day practical application of the tenets underpinning American political life, namely, to the victors go the spoils .

“I helped make Mexico, especially Tampico, safe for American oil interests in 1914. I helped make Haiti and Cuba a decent place for the National City Bank boys to collect revenues in. I helped in the raping of half a dozen Central American republics for the benefits of Wall Street. . . I helped purify Nicaragua for the international banking house of Brown Brothers in 1909-1912. . . I brought light to the Dominican Republic for American sugar interests in 1916. In China I helped to see to it that Standard Oil went its way unmolested. . .”

              In Smedley’s world, the Wall Street - politician - press axis was a vicious circle: Wall Street big shots bought newspaper chains and politicians like commodities; the newspapers pumped up certain politicians and shot down others; the incumbent politicians then used government power to make money for Wall Street interests. Smedley grimaced whenever he received orders to start a war for some special interest, or to put down striking workers as “rebel bands,” or to call an election and “see to it that our man wins” The can-do Marine always delivered, but he would not . . . Just fade away ;

“War is just a racket. . . Only a small inside group knows what it is about. It is conducted for the benefit of the very few at the expense of the masses. . .The general public shoulders the bill. And what is this bill? Economic instability. Depression and all its attendant miseries. Back-breaking taxation for generations and generations. . . I wouldn't go to war again as I have done to protect some lousy investment of the bankers. There are only two things we should fight for. One is the defense of our homes and the other is the Bill of Rights. War for any other reason is simply a racket. . . There isn't a trick in the racketeering bag that the military gang is blind to. It has its "finger men" to point out enemies, its "muscle men" to destroy enemies, its "brain men" to plan war preparations, and a "Big Boss" Super-Nationalistic-Capitalism. It may seem odd for me, a military man to adopt such a comparison. Truthfulness compels me to. . . I suspected I was just part of a racket at the time. Now I am sure of it. . . Looking back on it, I feel that I could have given Al Capone a few hints. The best he could do was to operate his racket in three districts. I operated on three continents.”

W hat about the new energy policy promised for today’s America? After 30 years of deliberation through seven presidents and fifteen congresses, here is the plan: articulate the problem but - no rival for oil - revivify gunboat diplomacy to secure Mideast oil reserves. Those phonies! Relics of bygone days, looking for quick riches in the dirt beneath their feet when the future lies in the force that moves the heavens. After frittering away thirty years of opportunity, and when the string finally runs out, the politicians leave the republic in the lurch, and revert to the inertia of an entrenched bureaucracy; boney old nags with blinders on hauling oil down the only path they understand. Stentorian cries of Send in the Marines will solve nothing. Marine bravery cannot conquer the laws of physics or reverse the natural processes of the earth. American oil is gone, used up, the party is over. Flashes of brilliance from practitioners of science, and not brilliant flashes of munitions are needed to carry humanity beyond the troubled pale of the Oil Century . For good or ill, the generations of this time live in the Nuclear Age ; an epoch of awesome possibilities. Representative government seems intellectually barren, morally stunted, too antiquated, pursy, and unable to cope. All they know how to do is steal.

              In conclusion, a parting shot from Smedley,

“. . . victory or defeat will be determined by the skill and ingenuity of our scientists.

If we put them to work making poison gas and more and more fiendish mechanical and explosive instruments of destruction, they will have no time for the constructive job of building greater prosperity for all peoples. By putting them to this useful job, we can all make more money out of peace than we can out of war. . . 

 So...I say, TO HELL WITH WAR! “



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“world petroleum production and consumption 2001”
“major general smedley darlington butler usmc”