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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)
http://www.mbendi.co.za/indy/oilg/p0070.htm#3
.
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.
(
http://energy.gov/aboutus/history/timeline79.html
)
∙
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! “
The author can be reached by email,
t@tiraco.com
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