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Currency/Warfare:¨A new world order will emerge from the ashes.¨
02-01-2012, 02:08 AM, (This post was last modified: 02-09-2012, 11:29 PM by h3rm35.)
Currency/Warfare:¨A new world order will emerge from the ashes.¨
Currency Warfare: What are the Real Targets of the E.U. Oil Embargo against Iran?

Currency Warfare: What are the Real Targets of the E.U. Oil Embargo against Iran?

By Mahdi Darius Nazemroaya

Against whom is the European Union’s so-called “oil embargo on Iran” really aimed at?

This is an important geo-strategic question. Aside from rejecting the new E.U. measures against Iran as counter-productive, Tehran has warned the member states of the European Union that the E.U. oil embargo against Iran will hurt them and their economies far more than Iran.

Tehran has thus warned the leaders of the E.U. countries that the new sanctions are foolish and against their national and bloc interests. But is this correct? At the end of the day, who will benefit from the chain of events that are being set into motion?

Are Oil Embargos against Iran New?

Oil embargos against Iran are not new. In 1951, the Iranian government of Prime Minister Mohammed Mossadegh with the support of the Iranian Parliament nationalized the Iranian oil industry. As a result of Dr. Mossadegh’s nationalization program, the British militarily blockaded the territorial waters and national ports of Iran with the British Royal Navy and prevented Iran from exporting its oil. They also militarily prevented Iranian trade. London also froze Iranian assets and started a campaign to isolate Iran with sanctions. The government of Dr. Mossadegh was democratic and could not be vilified easily domestically by the British, so they began to portray Mossadegh as a pawn of the Soviet Union who would turn Iran into a communist country together with his Marxist political allies.

The illegal British naval embargo was followed by regime change in Tehran via a 1953 Anglo-American engineered coup d’état. The 1953 coup transformed the Shah of Iran from a constitutional figure head to an absolute monarch and dictator, like the monarchs of Jordan, Saudi Arabia, Bahrain, and Qatar. Iran was transformed overnight from a democratic constitutional monarchy into a dictatorship.

Today, a militarily imposed oil embargo against Iran is not possible like it was in the early 1950s. Instead London and Washington use the language of righteousness and hide behind false pretexts about Iranian nuclear weapons. Like in the 1950s, the oil embargo against Iran is tied to regime change. Yet, there are also broader objectives that go beyond the boundaries of Iran tied to the Washington’s project to impose an oil embargo against the Iranians.

The European Union and Iranian Oil Sales

Iran’s largest customer for oil is the People’s Republic of China. According to the Paris-based International Energy Agency (IEA), which was created after the 1973 Arab Oil Embargo as the strategic wing of the Western Bloc’s Organization of Economic Co-operation and Development (OECD), Iran exports 543,000 oil barrels per day to China. Iran’s other large customers are India, Turkey, Japan, and South Korea. India imports 341,000 barrels per day from Iran, Turkey imports 370,000 barrels per day from Iran, Japan imports 251,000 barrels per day from Iran, and South Korea imports 239,000 barrels per day from Iran.

According to the Iranian Ministry of Petroleum the European Union only accounts for 18% of Iranian oil exports, which means less than one-fifth of Iranian oil sales. Only “collectively” is the European Union the second largest customer of Iran. All the E.U. countries together import 510,000 barrels per day from Iran. This collective rank that all Iranian oil importing E.U. countries have together is being highlighted by those that want to emphasize the effectiveness of the E.U. oil embargo against Iran.

Iran can replace oil sales to the European Union via new buyers or by increasing sales to existing customers like China and India. An Iranian agreement to work with China for stockpiling Chinese strategic reserves would fill a large portion of the vacuum left by the European Union. Thus, the oil embargo against Iran will have minimal direct effects on Iran. Rather, it is most likely that any of the effects that the Iranian economy feels will be tied to the global ramifications of the oil embargo against Iran.

Iran and Global Currency Warfare

According to the International Monetary Fund (IMF), both the U.S. dollar and the euro together constitute 84.4% of the world’s currency exchange reserves (end of 2011 date). The U.S. dollar alone, consists of largest share of the world’s currency exchange reserves in 2011, namely 61.7%.

Energy sales are an important part of this equation, because the American dollar is tied to the oil trade.

Thus, oil trade, through what is called the petro-dollar, is helping sustain the American dollar’s international standing. Countries around the world have been virtually forced to use the U.S. dollar to maintain their energy and trade needs and transactions.

To highlight the importance of the international oil trade to the U.S., all the Gulf Cooperation Council (GCC) members – Saudi Arabia, Bahrain, Qatar, Kuwait, Oman, and the United Arab Emirates – have their national currencies pegged to the U.S. dollar and thereby sustain the petro-dollar by trading oil in American dollars. Moreover, the currencies of Lebanon, Jordan, Eritrea, Djibouti, Belize, and several tropical islands in the Caribbean Sea are also all pegged to the U.S. dollar. Aside from the overseas territories of the United States, El Salvador, Ecuador, and Panama also all officially use the U.S. dollar as their national currencies.

The euro on the other hand is both a rival of the U.S. dollar as well as an allied currency. Both currencies work in tandem against other currencies in many cases and seem to be controlled by increasingly merging centres of financial power.

Aside from the seventeen European Union members using the euro as their currency, the Principality of Monaco, San Marino, and Vatican City have issuing rights and both Montenegro and the Albanian-majority Serbian province of Kosovo also use the euro as their national currencies. Outside of the euro area (Eurozone), the currencies of Bosnia, Bulgaria, Denmark, Latvia, and Lithuania in Europe; the currencies of Cape Verde, Comoros, Morocco, the Democratic Republic of São Tomé and Príncipe, and the two CFA zones in Africa; and the currencies of several Western European overseas dependencies, such as Greenland, are all pegged to the euro.

Several monetary zones are directly tied to the euro. In Oceania, the Comptoirs Français du Pacifique (CFP) franc, simply called the Pacific franc (franc pacifique), used in a monetary union of the French dependencies of French Polynesia, New Caledonia, and the Territory of the Wallis and Futuna Islands is pegged to the euro. As mentioned earlier, both the CFA zones in Africa are also pegged to the euro. Thus, both the Financial Community of Africa (Communauté financière d’Afrique, CFA) franc or West African CFA franc in West Africa – used by Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo – and the Financial Cooperation in Central Africa (Coopération financière en Afrique central, CFA) franc or Central African CFA franc – used by Cameroon, the Central African Republic, Chad, the Republic of the Congo (Congo-Brazzaville), Equatorial Guinea, and Gabon – have their fates tied to the monetary value of the euro.

Iran is not looking for military confrontation in the rising hostilities with the United States and European Union. Despite the warped narrative being presented, Tehran has said that it will only close the Strait of Hormuz as a last resort. The Iranians have also said that they will not let U.S. or hostile ships go through Iranian territorial water, which is their legal right, and that hostile ships could navigate through Oman’s territorial waters in the Strait of Hormuz instead. As a side note, among other things, the problem for the U.S. and Iran’s other adversaries is that the waters on the Omani side of the Strait of Hormuz are too shallow.

Instead of military confrontation, Tehran is fighting back economically in several ways. The first step, which started before 2012, was Iranian international oil sales and trade were diversified in regards to their currency transactions. This is part of a calculated move by Iran to move away from using the American dollar just like Saddam Hussein of Iraq did in 2000 as a means to fight back against the sanctions imposed on Iraq. In this context, Iran has created an international energy exchange or bourse competing with the New York Mercantile Exchange (NYMEX) and London’s International Petroleum Exchange (IPE), which both operate using the American dollar for transactions. This energy exchange, called the Kish Oil Bourse, was officially opened in August 2011 on Kish Island in the Persian Gulf. Its first transactions were made using the euro and the Emirati dirhem.

In context of euro and U.S. dollar rivalries, the Iranians originally wanted to turn to the euro and a petro-euro system with the hope that the competition between the American dollar and the euro would make the European Union an ally of Iran and de-link the E.U. from the United States. As political tensions have mounted with the E.U., the petro-euro has become less attractive for Tehran. Iran has realized that the European Union is submissive to U.S. interests under corrupt leaders. Thus, to a lesser extent, Iran has also tried to move away from the euro.

Moreover, Iran has broadened its move away from the use of the U.S. dollar and the euro as policy in bilateral trade relations. Iran and India are talking about gold payments for Iranian oil. Iranian and Russian trade is conducted in Iranian rials and Russian roubles, while Iranian trade with China and other Asian countries is conducted using the Chinese renminbi, Iranian rial, Japanese yen, and other non-dollar and non-euro currencies.

While the euro could have been a big winner from a petro-euro system, the actions of the European Union have worked against this. The E.U. oil embargo against Iran is merely hammering the nails in the coffin. Globally, the emerging matrix of Eurasian and international trade and transaction outside of the umbrellas of the American dollar and the euro is weakening both currencies. The Iranian Parliament is now passing legislation to cut oil exports to the members of the European Union that will be part of the sanctions regime until they rescind the Iranian oil sanctions. The Iranian move will be a blow to the euro, especially since the European Union will not have time to prepare for the Iranian energy cuts.

There are several possibilities that could emerge. One of them is that this could be part of what Washington wants and it could be playing into its hands against the European Union. Another is that the U.S. and specific E.U. members are working together against strategic economic rivals and other markets.

Who Benefits? The Economic Targets are beyond Iran...

The end of Iranian oil exports to the European Union and the decline of the euro will directly benefit the United States and the U.S. dollar. What the European Union is doing is merely weakening itself and giving the U.S. dollar the upper hand in its currency rivalry against the euro. Moreover, should the euro collapse, the American dollar will quickly fill much of the void. Despite the fact that Russia will benefit from higher oil prices and greater leverage over E.U. energy security as a supplier, the Kremlin has also warned the European Union that it is working against its own interests and subordinating itself to Washington.

Many important questions are at play about the economic consequences of increased oil prices.

Will the European Union be able to weather the economic storm or a currency collapse?

What the E.U. oil embargo against Iran will do is destabilize the euro and snowball globally hurting non-E.U. economies. In this regard, Tehran has warned that the U.S. aims to hurt rival economies through the adoption of E.U. oil sanctions against Iran. Within this line of thinking, this is the reason why the U.S. is trying to force China, India, South Korea, and Japan in Asia to reduce or cut Iranian oil imports.

Within the European Union, it will be the most fragile and struggling economies, such as Greece and Spain, which will be hurt by the E.U. oil embargo against Iran.

The oil refineries in the European Union countries that import Iranian oil will have to find new sellers as sources and will also be forced to adjust their operations. Piero De Simone, one of the leaders of Italy’s Unione Petrolifera, has warned that approximately seventy oil refineries in the E.U. could be shutdown and that Asian countries could start selling refined Iranian oil to the European Union at the expense of the local refineries and the local petroleum industries.

Despite the political claims supporting an oil embargo against Iran, neither will Saudi Arabia be able to fill the void of Iranian oil exports to the European Union or other markets. A shortfall in oil supplies and the production changes could have spiralling effects in the European Union and on the costs of industrial production, transportation, and market prices. The prediction is that that the E.U. will effectively be deepening the crisis in the euro area or Eurozone.

Moreover, the rise in everyday prices, ranging from food to transportation, will not be limited to the European Union, but will have global ramifications. As prices rise on a global scale, the economies in Latin American, Caribbean, African, Middle Eastern, Asian, and Pacific countries will face new hardship, which the financial sector in the U.S. and several of its partners – including members of the European Union – could capitalize on by taking over certain sectors and markets. The IMF and World Bank, as the Bretton Woods proxies of Wall Street, could get into the mix and impose more privatization programs benefiting the financial sectors of the U.S. and its main partners. Furthermore, how Iran decides to sell the 18% of oil it will stop selling to E.U. members will also be a mediating factor.

The Ghosts of the 1973 Arab Oil Embargo: Libya and the International Energy Agency

While countries in Africa or the Pacific have no strategic oil reserves and will be at the mercy of global price increases, the U.S. and the European Union have worked and tried to strategically insulate themselves from such scenarios. This is where the Paris-based International Energy Agency (IEA) comes into the picture. Libyan oil reserves are also a factor to the hostilities and petro-politics involving Iran.

The IEA was created after the 1973 Arab Oil Embargo. As mentioned earlier it is a “strategic wing of the Western Bloc’s Organization of Economic Co-operation and Development (OECD).” The OECD is a club of countries that includes the U.S., Britain, France, Germany, Spain, Italy, Belgium, Denmark, Japan, Canada, South Korea, Turkey, Australia, Israel, and New Zealand. It is essentially based on the contours of the Western Bloc, which is comprised of America’s allies and satellites. Aside from Israel, Chile, Estonia, Iceland, Slovenia, and Mexico all the members of the OECD are members of the IEA.

Since its creation in 1974, one of the responsibilities of the IEA has been to stock strategic oil reserves for the OECD countries. During the NATO war against Libya the IEA actually opened its strategic oil reserves to compensate for the void left by a lack of Libyan oil exports. The only other two times this happened were in 1991, when Washington led a military coalition in its first war against Iraq, and in 2005, when Hurricane Katrina devastated the United States.

The war in Libya had many purposes:

(1) preventing African unity;

(2) driving China out of Africa;

(3) strategically controlling important energy reserves; and

(4) guarding oil supplies in the scenario of any American-led conflicts against Syria and Iran.

What the NATO war in Libya has done is secure oil output from Libya, because there was a chance that the Libyan Arab Jamahiriya under Colonial Muammar Qaddafi could have suspended oil sales to the European Union in support of Syria or Iran in possible conflicts with the U.S., NATO, and Israel. It is also interesting to note that one of the Libyan figures that helped enable the war against Libya in the United Nations was Sliman Bouchuiguir, the head of the Libyan League for Human Rights (LLHR) and the current Libyan ambassador to Switzerland, who worked on formulating a strategy against allowing oil from being used as a strategic weapon to insure that that the 1973 oil crisis never repeat itself for the U.S. and its allies.

Aside from Iran, the Syrians have also been a source of oil imports for the European Union. Like Iran, the E.U. has also cut their bloc off from Syrian oil via a sanctions regime engineered by the U.S. government. With Iranian and Syrian oil cut off from the E.U., the strategic value of Libyan oil rises. In this regard, the reports about the deployment of thousands of U.S. troops to Libyan oil fields can also be analyzed as being coordinated or tied to the growing U.S. and E.U. hostilities with Syria and Iran. Rerouting Libyan oil shipments to the E.U. that were intended for China can also be part of such a strategy.

The Psychological War

In reality, the sanctions regime engineered by the U.S. government against Iran has gone as far as it can go. All the speeches about Iranian isolation are bravado and far from the reality of current international relations and trade. Brazil, Russia, China, India, Iraq, Kazakhstan, Venezuela, and various countries in the post-Soviet space, Asia, Africa, and Latin America have all refused to join the sanctions against the Iranian economy.

The E.U. oil embargo, coupled with the broader sanctions against Iran, has broad psychological implications. Iran and its ally Syria both face a multi-dimensional war that has economic, covert, diplomatic, media, and psychological scopes.

The psychological war, which involves the mainstream media as a tool of foreign policy and war, constitutes an efficient propaganda instrument for the U.S. due to its lower costs. Yet, the psychological war can be fought on both sides.

Much of the power of the U.S. is psychological and tied to fear. Like the geography of the Persian Gulf, time is on Iran’s side and working against the United States.

If Iran continues on its present course and is undeterred by sanctions, this will help break a critical psychological threshold, which around the world tends to discourage countries from confronting and opposing the United States.

Should many countries continue to refuse to bow down to the Obama Administration pertaining to the impostion of sanctions against Iran, this will also be a blow to the prestige and power of the U.S., which would also have economic and financial implications.

Moreover, at the end of the day, the E.U. oil embargo will hurt the E.U. instead of Iran. In the long-term it could also hurt the United States.

Structurally, the effects of the E.U. oil embargo will further entrench the E.U. in the orbit of Washington, but these effects will catalyze growing social opposition to Washington, which will eventually manifest in the political and economic arenas.

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02-01-2012, 01:04 PM,
RE: Currency Warfare: What are the Real Targets of the E.U. Oil Embargo against Iran?
Refining oil by means of atomic power not by burning some of the oil in the process.
I think that they are making "sinthetic" uranium to generate heat for the refining process and this is some kind of
out of bounds outlaw effort. The histeria of a wepons second agenda is total bull. But why is heating / cracking
crude by uranium such a no no. There is a real lack of info in this area in general on the internet. Some mention
that it was seen as a good safe low tek way of large scale heat generation in the 1960`s with salt liquid reactors
that were also tried in aircraft and super hovercraft / ecranoplanes etc. It is not the GE model. I smell a factory under a
refinery above a reactor. Making what?
02-01-2012, 08:21 PM, (This post was last modified: 02-01-2012, 08:43 PM by h3rm35.)
RE: Currency Warfare: What are the Real Targets of the E.U. Oil Embargo against Iran?
methinks it has a lot to do with the emerging currency war with china and both India and China´s decision to buy Iranian oil in gold instead of the dollar. They could be shaping up to be (at least) financial allies which is extremely problematic for NATO interests, specificly isolating Russia and China while continuing to be able to pump Russia´s gas to the EU and China´s, well, everything, to the US while effectively strangling them both geo-politically

The US & EU have been actively courting India with weapons deals to try to quell their anger over military and financial support to Pakistan. The US has talked the talk as far as supporting them but has done little else other than offer to sell them weapons.

On a side note: The US aiding Pakistan is an even more complex issue than why they´re in Afghanistan in the first place, since the issues in Afghanistan couldn´t arise without the complicity of the ISI (Pakistani intelligence) and entrenched career officers in the military, along with their connections to organized crime. The whole charade of of the Banazir Bhutto assassination and the ascendency to power of the current puppet regime was fabricated to distract from where the real power actually resides. Tom Burghardt has exposed tons of these links between US intelligence and drug enforcement, and Pakistani organized crime, intelligence and military. Basically the US knew what was up in Pakistan before they got involved, and I have a suspicion (along with the fact that this was the ultimate goal of the 9/11 false flag - not an Iraqi invasion. That was a distraction mechanism as well, and it was used to distract from illegal activity and war crimes in the ¨wild, wild east¨ that is Afghanistan by raising American and international ire against the other, more blatant raging atrocities) that the billions of dollars they´ve pumped into the government would make their way to their enemies so that they could continue their presence in the Afpak region.

[Image: asia_map_2007_972px.jpg]

This strategic positioning, in essence, bisects any easy over-land routes to china from Iran and aids in the strategic initiative of cutting off possible additional Russian gas and oil pipeline routes from the major distribution points in the Ukraine heading eastward. Since the US can pretty much wipe out any country from the sea and would most likely decimate any other navy in battle, they consider themselves to ultimately control the Strait of Hormuz should it come down to it, but China (and now India) would get pretty pissed off about military action that cut off their access to Iranian oil. The US can afford to keep Iran as an enemy, but it can´t afford both an economic/technological and military war with china while keeping up their current bullshit elsewhere. The concept is to divide and conquor any possible geographical areas of resistance (see this thread for more info on this reasoning) to the people who run NATO, the EU, the UK, the US, and their borderless (therefore impossible to attack militarily) counterparts In the markets and finance. They´re pretty sure about their eventual success, and they´re pretty sure that the only thing that could keep them from winning total global control is a concerted effort by the people of Canada and the US, (and to a lesser extent, the EU and UK,) to wrestle control of their own countries back from the oligarchs, hence the orchestrated financial collapse and things like the 2012 NDAA, USAPATRIOT Act, Perfect Citizen, etc.

but I digress...

India had been rebuffing US allied country after country after country for fighter sales until a recent decision to go with a French manufacturer, (as pointed out in the link above,) and as many conservatives are aware, even if they are NATO members, French foreign policy is often not in synch with the US´. Basically, India has been screwed over time and again, but understands its geographic positioning (see map above) is intrinsic beyond its nuclear capability to its value as an ally to the US, and the feel (IMO understandably,) supremely undervalued. The economic decision to buy Iranian oil in gold and to rebuff advances for lucrative weapons deals from the US were almost as big a ¨Fuck You¨ to the US as their move in 2009 to buy 200 tons of gold from the IMF out from under China who was trying to negotiate a lower than market bulk purchase price.
That purchase was while India was attempting to curry (no pun intended,) favor with the US against Pakistan when the US was threatening to revoke more aid from them unless they made ¨more of an effort¨ against Taliban aid in Afghanistan and terror attacks elsewhere.

It looks like they´re trying to show their frustration, but pissing off the world´s only superpower, especially by buying a strategic resource by a country in their cross-hairs already, will get shit piled on to you from all sides - in this case, all EU demand and demand from their allies for Iranian oil will dry up, essentially leaving Iran with two major customers (as Russia´s got plenty of oil,) China and India. Iran will have to raise prices, (if they´re even capable of exporting at all at that point! Once again, take a look at the map, and the US assets blocking over-land distribution to the east,) or have serious economic consequences which, considering how poorly they´re fairing under sanctions already in place, will be completely intolerable. They´ll either have to crush their own economy by the lost demand through the EU embargo, or loose their two best customers which will also crush their economy. The destruction of Iran will force Chinese and Indian oil dependence on NATO allies bringing them back into the fold of the dollar, all while the US has plausible diplomatic deniability.

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02-02-2012, 10:56 PM, (This post was last modified: 02-11-2012, 09:45 PM by h3rm35.)
RE: Currency Warfare
Russia Today´s take on Iran´s response that the EU embargo will only hurt the EU... obviously, they won´t agree that this will crush them:

Quote:Petrodollar pumping US policy on Iran, backfire looms

As tensions between the US and Iran heat up, author Michael T. Winter believes the main reason behind America’s harsh stance is Tehran’s move to seek an alternative to the dollar as an oil currency.

­Economic sanctions, spearheaded by the US and, less willingly, the EU could have a disastrous effect on both of their respective economies. If Iran cannot sell their oil to Europe, there are plenty of customers waiting in the wings, and if they come bearing not petrodollars, but gold and sovereign currencies, then all the better for Iran. These sanctions, if enforced, will in effect place a serious dent in the power of the petrodollar.

Any rhetoric regarding Iran’s nuclear program and the insistence on crippling it is nothing more than a US attempt to force regime change for one more receptive to maintaining the hegemony of the petrodollar.

The world now knows the truth about the US and how they conduct their affairs. US hostilities toward Iran have nothing to do with nuclear weapons development. If that were the case, then North Korea and Pakistan would be facing similar sanctions and threats, but they aren’t. The difference of course is in what lies beneath the ground – oil. Iran has it and the other guys don’t.

At the heart of the issue is not Iran’s dubious attempt to build nuclear weapons, or even oil, but how that oil is paid for. In 1973, Richard Nixon promised King Faisal of Saudi Arabia that the US would protect Saudi Arabian oilfields from any and all interested parties seeking to forcefully wrest them from the House of Saud. It’s important to remember that in 1973, Saudi Arabia didn’t have a fraction of the military and ground forces it possesses today (almost exclusively US manufactured weapons) and the USSR was very much a threat.

In return Saudi Arabia, and by extension OPEC, agreed to sell their oil in US dollars only. As if that weren’t sweet enough, as part of the deal, they were required to invest their profits in US treasuries, bonds and bills. The real zinger is that all countries purchasing oil from OPEC had to do so in US dollars, or ‘petrodollars’.

This strengthened the US dollar, resulting in a steady US economic growth cycle throughout the 80’s and 90’s. Countries purchasing OPEC oil started buying US treasury bills, bonds and securities to ensure they could continue purchasing OPEC oil. This worked fine for the US until 2001.

No plan, however well formulated, functions smoothly indefinitely.

2001, enter Saddam Hussein. He floated a plan to sell oil for European currencies in lieu of petrodollars. Shortly after Iraq was ‘suddenly’ found to be seeking and stockpiling weapons of mass destruction – allegations spearheaded by the US. The world knows what happened, suffice it to say that Saddam is dead and Iraq is ‘back on track’, selling its oil for petrodollars once again.

Muammar Gaddafi harbored the Lockerbie Bombers and allowed various terrorist organizations establish training camps in Libya. He tried to buy a nuke from China in 1972. In 1977, he approached Pakistan, then India. He sought nerve gas from Thailand. In spite of well over fifty failed assassination attempts on Gaddafi by Israel, the US and the UK, Libya was left to its own devices for the most part. Seeking nukes and harboring terrorists is one thing, but threatening the petrodollar is quite another. Gaddafi made a fatal error when he decided to move away from the petrodollar in favor of other currencies. This simply was not tolerated by the US. Having already played the WMD card in Iraq, something new was pulled from the US ‘regime change’ grab bag. Within a year, ‘internal’ elements rose up in rebellion against Gaddafi and now he is dead. Long live the petrodollar.

Dominique Strauss-Kahn, former head of the International Monetary Fund (IMF), suggested last year that the Euro would be a more suitable oil reserve currency than the US Dollar. Within three months of that statement, allegations of rape ruined his career, derailing his bid for the French Presidency in the process. Soon thereafter, all charges were dropped, but of course, le dommage était fait – the damage was done. Christine Lagarde, DSK’s replacement as head of the IMF sees no reason to change the current arrangement, naturellement.

The Iran situation is a little trickier. The US has sought to dismantle Iran’s regime ever since the 1979 Iranian Revolution, so this round of hostilities, while not new, reflects a new level of intensity. Why, after thirty years of hostility, has the US ratcheted up its rhetoric? As Obama stated in his recent State of the Union address, when it comes to Iran and the insistence they dismantle their nuclear program, “no options are off the table”. By stating ‘no options’ this would include nuclear deployment as a deterrent.

The answer of course is that Iran is now seeking to disengage itself from the petrodollar dynamic. In 2005, Iran sought to create an Iranian Oil Exchange, thus bypassing the US controlled petrodollar. Fear that western powers would freeze accounts in European and London banks put an end to that plan.

But that was not the end of their attempts, and Iran sought other ways to get around the petrodollar noose. There are rumors that India, which imports 12% of their oil from Iran, has agreed to purchase oil for gold. Energy trade with China, importing 15% of its oil and natural gas from Iran may be settled in gold, yuan, and rial. South Korea plans to buy 10% of their oil from Iran in 2012, and unless Seoul sides with American and European sanctions, it is likely to use gold or their sovereign currency to pay for it. Also, Iran is already dumping the dollar in its trade with Russia in favor of rials and rubles.

Iran is breaking the back of the petrodollar. Others have tried, but Iran is succeeding. To understand how disastrous this is for the US, one must have a basic understanding of how critical a role the petrodollar plays in the economic health of the US.

Through King Faisal, Nixon elevated the US to supreme economic ascendency, not unlike Damocles in his desire to rule. Sitting on the (economic) throne of the world is great, but Nixon was either unaware of the sword dangling over the US economic system, or chose to ignore it in favor of reaping the rewards of the moment.

By creating the petrodollar paradigm, the US economy soared, as all countries of the world were required to amass US currency to purchase oil from OPEC nations. Sales of T-bills, securities and US bonds soared. US coffers fattened. With the US dollar as the world’s oil currency reserve, economic fortune favored the US. But with great reward comes great risk. While other countries exchanged their currency for the dollar, (forfeiting value in the process) the US simply printed more money to match their needs and purchase their oil – essentially for free. The best example is that while gasoline in the US cost $3.00 per gallon, in Europe that same gallon costs $6.00 or more.

Herein lies the danger. If Iran is successful in its bid to set up their own bourse, or oil exchange, then what need does the world have for all those US dollars? The answer is none at all. As Iran creating gold and sovereign currency partnerships with India, China, South Korea and Russia, the hegemony of the petrodollar will be destroyed.

The resulting sell-off of US dollars, T-bills, securities, bonds and assets will flood the already swollen world economy with even more useless dollars, ultimately devaluing it into a position where hyper-inflation becomes a risk.

So, while the US government sabre-rattles and prattles on and on about nuclear weapons and the threat Iran poses to the Middle East, the thin veneer of lies spouted by the elite controlled media is being stripped away, revealing the truth of their warmongering rhetoric.

The US, by their foolish insistence on enforcing embargoes and sanctions against Iran, is hastening the end of the petrodollar and ushering in the age of US dollar hyper-inflation. A practical example: One loaf of bread in a healthy economy is $1.00. In an inflationary economy it’s $1.75. In a hyper-inflationary economy, $500.00.

Bullies may be large and dangerous, but rarely are they intelligent.

Damocles wisely vacated the throne of Dionysius before the sword fell upon his head, but the US is foolishly refusing to step down from their economic dais in spite of the catastrophic effect current policy direction will mean for US citizens and the world economy.

­Michael T. Winter
More On this concept, but on a broader scale:
Quote:Why Attacking Iran Will Not Work in 2012

Patrick Henningsen
21st Century Wire
January 5, 2011

All signs coming out of Washington, London, Paris and Tel Aviv are pointing towards a pre-emptive military strike against Iran in 2012. But a number of key indicators are also pointing towards an unsuccessful, unlikely operation, whose failure could result in a military and economic tailspin from which the United States and Israel are unlikely to recover.

Currently, the US is following a trajectory of past unsuccessful empires that were unable to sustain themselves resulting in an eventual collapse from within. The US is currently running up a budget deficit which is not only threatening to bankrupt its entire economy, but also threatening the hegemony of its sole instrument for advantage and influence on the world stage – the US dollar. Any threat to the supremacy of the dollar is also a threat to the empire.
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It is difficult to calculate the outcome of a western attack against Iran -because there are so many variables.

No moral mandate

For centuries, even Rome required a moral mandate as it conquered the known world. As was the case with the Iraqi invasion and occupation in 2003, the West and its Axis powers led by Washington will require a multi-nation coalition backed by some form of moral mandate in order to move forward with their plans.

Previously, a US-UK campaign against Iraq’s alleged weapons of mass destruction was waged through the UN, and was sufficient at the time in achieving a minimal sway in public opinion needed from both the American and British people, justifying their governments’ foreign policy goals enough to get the war off the ground. But the cost in 2012 of pushing forward under false pretences with both Afghanistan and Iraq in 2003, means that the Axis coalition powers have already played their best hand under the current social democratic system.

It is clear now, after multiple failures by the UN’s IAEA to implicate Iran in developing nuclear weapons that a moral mandate is not there, so despite the best efforts of the hawks and FOX News, there cannot be the sway in public opinion needed to move forward militarily. The only remaining technique available to trigger a military conflagration is a false flag attack orchestrated by either the US, Israel or the UK, whereby Iran can be blamed for firing the ‘first shot’.

The war has already begun

As far as the Islamic Republic of Iran is concerned, the war has already begun. US-backed sanctions imposed against the Central Bank of Iran have been put into effect, even though no proof has actually been presented to the UN justifying such a pre-war move. But sanctions are still the first step in a physical war. The result of the Axis open abuse of the UN’s Security Council resolution process, a number of influential nations have already announced their disregard for these US-backed sanctions.

This week, South Korea has announced that despite the White House’s wishes, it will still be buying roughly 10 percent of its crude oil from Iran in 2012. China is also defying the US call for sanctions, stating it will ‘resume its existing trade relationship’ with Iran this year. In 2012, China plans to make Iran its no.2 oil importer, adding to an already existing relationship worth approximately $30 billion per year. The West are in no position to challenge China over Iran at present. This means that the Axis powers will struggle to keep anything near an air-tight international mandate. They may hurt Iran in the short-term, but in the long run, such sanctions will have no teeth.

The cost to America and Europe of dragging out this ‘war of words’

The most likely outcome in the first part of 2012, is the West dragging a war of words via press briefings and imperial rhetoric. An increasingly media savvy Iran will naturally follow suit, winning favour at home as the underdog in this imperial clash. The result is a war of the words in the media.

But even the cost of this ‘posturing war’ to the US and Europe may be too much to bear at this time.

Even the threat of an attack on Iran will automatically drive oil speculators to push up the price of oil futures, which will in turn raise the price of oil at the pump at a time when Western businesses and consumers can hardly afford it. And this series of events is already in motion. The Strait of Hormuz is the world’s busiest oil shipping lane, with 17 million barrels of oil per day passing through. Iranian announcements this week stating they will not only defend their territorial waters, but retaliate by closing the Strait’s shipping lanes if it’s attacked by the US or Israel – have already driven up the global price, with the price of Brent Crude jumping another $5 today to an eight-month high of $111.65 per barrel. CNN reported this week:

Quote: Oil prices surged 4% Tuesday, fuelled by continued anxiety over Iran’s growing threat to shut down the Strait of Hormuz after the Iranian military launched a missile test.

“It’s mostly about Iran right now,” said Peter Beutel, analyst with energy risk management firm Cameron Hanover. “That’s the most bullish factor.”

Oil prices jumped 4.2% to settle at $102.96 a barrel. That’s the highest closing price since May 10, when prices ended the day at $103.88 a barrel.
The picture gets progressively worse as the US-Iran face-off continues into 2012. Business Insider released a report today detailing a likely scenario whereby barrel costs skyrocket to $150:

Quote:Managers of the Guinness Global Energy fund have warned of an oil price spike to $150 per barrel if Iran were to carry out its threat of closing the Strait of Hormuz and blocking 15% of global oil exports.

“The exports transported through the Strait of Hormuz are equivalent to two Saudi Arabia’s or two Russia’s, so the potential impact on the price is massive. We do not think this will happen but we cannot rule it out completely.”

Cash windfall for the oil industry

OPEC oil producing Gulf nations led by monarchies Saudi Arabia, UAE, Kuwait, Qatar and Bahrain, will certainly benefit financially from any initial UN sanctions as well as any protracted stand-off between the West and Iran fueled by hype, with speculation driving up the price of oil, allowing the producer nations to effectively printing money overnight.

GCC foreign companies and joint ventures include Aramco, Harken Oil (Bush family company), Texas Oil, Union Oil of California, and a host of others. Distributors and retail winners include the likes of Exxon, Royal Dutch/Shell, BP, Chevron, Getty, Phillips, Texaco, Mobil, Occidental/Gulf and Amoco. Each of these transnational oil refiners, distributors and retailers can expect a cash windfall and a rise in their all-important share prices, but more importantly, the current crisis will be an opportunity for this cartel - to fix a new, higher price at the pump.

Even if the stand-off were to climb down between the West and Iran, and the price per barrel were to somehow drop back below $100, this cartel of oil companies will still work to maintain a new higher overall pricing standard at the pump. Past price relationships between barrel price and pump price will verify this cartel practice. The economic implications, particularly on American and European economies which relies so heavily on petroleum to distribute and deliver staples like food and other day-to-day goods – could be horrific, instigating a wave of inflation on an already inflation-battered US consumer. Likewise, such a crisis will have a negative effect on the value empire’s holy grail – the US dollar.

A spike in US prices will also trigger-off that old predictable debate during the coming 2012 US Presidential election cycle – over lifting any moratoriums on domestic oil drilling within the United States (drill baby, drill). If any are lifted, again, it’s yet another win for the oil industry and its shareholders.

Risks involved in a regional conflict

For a perspective of the Libyan model of intervention, NATO is unlikely to involve itself in a large-scale military operation in Iran. It would prove too costly from both economic and political standpoints.

Neither the US or Israel has engaged in a bona fide naval conflict in decades. In the case of the US, owner of the world’s largest navy, its last true naval military affair was WWII. As Great Britain painfully discovered during its costly Falkland Island War adventure, even one rudimentary French-made Exocet Missile launched by Argentina below radar, was enough to not only cripple a major piece of its naval fleet, but also enough of a black eye to nearly derail majority public support for their ill-conceived war effort from the opposition and back-benchers home in London.

Similarly, the Iranian defense has the capability to sink not one, but many US Naval ships currently flexing their muscles on the periphery of Iranian territorial waters. Such an event would register with shock and horror in the US public mind, but worse, may be used by Washington hawks to justify a revenge nuclear strike against Iranian civilians. Both Washington and Tel Aviv have already raised the talking point of deploying “tactical nukes” against Iran. Such foreshadowing should not be ignored, as it is often a clear indicator of things to come.

Any nuclear conflagration by the US or Israel would most certainly result in a global backlash against the West – at its worst acting as a procession into the hot stages of World War III – or at its very least, re-balkanizing the geopolitical scene into a New Cold War, with the West on one side and Iran, China, Pakistan, and Russia on the other.

Watch author Patrick Henningsen in this segment from Al Jazeera’s program Empire: Targeting Iran, as analysts spec out potential wargames between the West and Iran:

GCC becomes a target

Another factor seldom mentioned by vocal proponents of regime change in Iran, like Hillary Clinton and neocon war hawks in Washington, is that any attack on Iran will most certainly mean that all US allies in the region will become a potential target. This means it is unlikely that those wealthy and developed GCC countries would remain untouched by a conflict happening only a mere hundreds of miles away. Neither would nearby major US military installations in Iraq, Qatar and Afghanistan. All are likely targets in a hot Iranian conflict.

Petrol monarchies like the UAE (most notably Abu Dhabi and Dubai), Kuwait and Qatar currently rely heavily on a high standard of living and complete domestic security and stability in order to survive as societies. These fragile petrol monarchies rely on a very thin veneer of law and order – one which props up their marketing image of a luxurious “Middle East destination”. Any Iranian retaliation against these fragile US allies would result in a massive flight of persons, ex-pats and financial capital from the GCC to much safer havens – like Europe, the US, or Singapore.

If there is to be a war, it will be the US, UK, France, Israel and their allies who will do the fighting. But the GCC would still need to defend itself from reprisals. In December 2011, the United States announced a $3.48 billion arms deal with the UAE, which included state-of-the-art THAD missile defense systems, as part of a wider American effort to build up missile defenses among Gulf allies to counter Iran. In addition, the US and Saudi Arabia signed a $1.7 billion deal earlier in 2011 to boost the country’s Patriot missiles and Kuwait purchased 209 GEM-T missiles at a cost of $900 million. This regional missile defense strategy will need land-based interceptors to knock out incoming missiles, backed up by a detection network aboard a team of US Navy Aegis-class warships.

Although these are significant acquisitions on the part of the GCC, they are by no means blanket protection from an Iranian retaliation, and are most likely the result of America’s arms industry, in its honored tradition, bleeding the GCC of cash with yet more expensive hardware, a hard sell based on fear and war hype.

Taking all this into account, and noting the incredibly concentration of wealth in the GCC, it’s hard to see a scenario where the monied interests would tolerate such a risk to their progressive Arabian project that they have spend decades investing in and building from scratch.

Post-Bombing Blowback

Aside from the GCC risk, it is with near certainty that one could predict a full-scale regional backlash, and genuine uprising around the Muslim world should the US or Israel come good on their threats of a pre-emptive strike against Iran. Iranian civilian deaths could not be avoided, and hence, their would be a blood price to pay by the West in the eyes of many Muslims. Such a pan-Arab uprising would stretch US and Israel capabilities in the region past their ability to maintain control of the situation. The results for Israel could be dire in such a scenario, and it’s only expected that a tit-for-tat would spiral into a long regional conflict.

The West’s best chance to weather such a storm would be to overtake, or set up a military base in either Lebanon or Syria in order to neutralize traditional Iranian ally and Israeli opponent – Hezbollah – currently based in Lebanon. Without wiping out Hezbollah’s military capabilities, Israel cannot safely move forward with a unilateral/US attack on Iran. The time table for such a Syria or Lebanese take-down would put any possible attack on Iran well into late 2012, or even 2013 and beyond.

A Giant Dirty Bomb

If the US or Israel were to hit any of the said Iranian nuclear facilities or reactors, it has the potential to become a giant ‘dirty bomb’. In such a scenario, the civilian deaths could exceed 1,000,000 and a radioactive fall-out would certainly spill over into the surrounding US clients like Afghanistan, Saudi Arabia, the UAE, Qatar, Iraq, Kuwait and possibly as far as Israel/Palestine, Turkey, Georgia, Pakistan, India and parts of southern Europe.

Following such a radiological event, the West would certainly be blamed for any and all environmental damage and death which occurs, resulting in a massive loss of international face, followed by massive financial reparations which would ultimately cripple their already weak economies. Worse than this however, it would certainly throw the global economy into a long economic depression.

Most sane analysts would agree, this is a risk too high, and a price too high to pay. So the real question remains then, are analysts in Washington and Tel Aviv sane enough to make policy decisions?

An Israeli driven effort

Like previous AIPAC campaigns to hit Iraq, the current drive to isolate and demonize Iran has been cooked up in the Israeli lobby’s kitchen. Due to a revolving wheel of campaign contributions to each and every US Congress and Senate candidate, ‘putting Israel first’ has become a top priority for any politician with any ambition in Washington. If any official steps out of line and criticizes Israel, AIPAC functionaries like the ADL and SPLC are sprung into action and a PR campaign is usually waged against the offending public official.

The Israeli lobby will claim that a pre-emptive strike on Iran is needed because Iran has stated that it wishes to, “Wipe Israel off the map”. Most war hawks would be surprised when they learn that such words were never actually spoken by Iran’s President Mahmoud Ahmadinejad. Shouldn’t this revelation change the entire Israeli perspective? It should, but it doesn’t. Regardless of any evidence to the contrary, the lobby and its media partners will continue repeating their faux version of the event as if it were something that actually happened, or spelled a genuine threat to the physical state of Israel. Likewise, US politicians will in turn acknowledge the lobby’s version of events, themselves repeating the very same faux threat – as if this somehow justify plans for a pre-emptive strike on Iran.

What is most important here again, is that at no point during any of this political maneuvering, could either the US, or Israel produce any compelling evidence at all that Iran has, or is near possessing a nuclear weapon in their military arsenal. Even if they could fabricate such evidence to start a war, there are simply too many pieces out of place on the grand chessboard right now to indicate an imminent attack on Iran in the spring or summer of 2012.

So far, however, the clear winner is the oil industry and the OPEC nations, winning a shift in wealth from the global middle class into the hands of petrol monarchies and oil company shareholders.

and there´s this news today - The Merkel´s courting Chinese investment in the Euro:

Quote:Merkel seeking euro-savior and Iran-buster in China

Angela Merkel says China’s help in the eurozone would boost not only the debt-ridden region, but the global economy in general. The German Chancellor is paying a three-day visit to Beijing, seeking economic and political support.

“The euro has made Europe stronger,” Merkel asserted in a speech at China’s Academy of Social Sciences, just hours before meeting her counterpart, Premier Wen Jiabao.

She said despite the ongoing sovereign debt crisis, Europe was “on the right track” with its plan to curb overspending. Merkel said the EU had made “big progress” over the past few years.

China, which has the world’s largest financial reserves, is seeking investment opportunities around the globe, and the money would be handy for tackling Europe’s problems.

Meanwhile, China’s Prime Minister, Wen Jiabao, said Beijing is considering increasing its help to the eurozone.

“China will use its money, which is hard-earned, very wisely,” Christoph Horstel, government consultant and political analyst told RT. “That means they will have single investments not so much in the eurozone […], but in any case, more directly into companies – things that are strategically on the Chinese agenda.”

At the same time, Horstel believes Merkel “will even not lobby very much for Chinese investment into Europe because she knows that this is truly a bad investment.”

The leader of Europe’s biggest economy also called for a level playing field for German firms operating in China, and vice versa.

On the political front, Merkel called for support on Syria and Iran, the two pressing issues on the global agenda.

Germany needs China’s backing for a UN Security Council draft resolution which would call on Syrian President Assad to step down. Beijing and Moscow, both veto-wielding members of the Council, oppose it.

“It is important that the international community speak with one voice at the United Nations,” the German leader said.

However, there is no possibility that “Angela Merkel can actually change the Chinese position on the pace of Syria as well,” Yongjin Zhang, Professor of International Politics from the University of Bristol, told RT.

As for Iran, Beijing has refused to join the US and EU in imposing sanctions on the Islamic Republic’s oil industry. Being the largest importer of Iranian oil, China is in a position to put much leverage on Tehran, which Merkel hopes to convince the Chinese government to do.

In order to win favors from China, Berlin may offer its support on issues of importance to Beijing, particularly in “dealing with the US,” says Simon Shen, a professor at the University of Hong Kong.

“Germany is the most powerful member of the EU, and China has always wished to lobby Germany’s support,” he told RT.

Among other issues high on the agenda is the rare earths trade. The elements are essential for the manufacture of many high-tech products, and China, the world’s leading exporter, is accused of restricting its trade in a bid to drive up prices and make businesses move onto its territories. Beijing is citing environmental concerns as the reason for mining restrictions.
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02-09-2012, 11:05 PM, (This post was last modified: 02-09-2012, 11:55 PM by h3rm35.)
RE: Currency Warfare
The Sino-Russian Alliance: Challenging America's Ambitions in Eurasia

By Mahdi Darius Nazemroaya

Global Research, September 23, 2007

Quote:“But if the middle space [Russia and the former Soviet Union] rebuffs the West [the European Union and America], becomes an assertive single entity, and either gains control over the South [Middle East] or forms an alliance with the major Eastern actor [China], then America’s primacy in Eurasia shrinks dramatically. The same would be the case if the two major Eastern players were somehow to unite. Finally, any ejection of America by its Western partners [the Franco-German entente] from its perch on the western periphery [Europe] would automatically spell the end of America’s participation in the game on the Eurasian chessboard, even though that would probably also mean the eventual subordination of the western extremity to a revived player occupying the middle space [e.g. Russia].”

-Zbigniew Brzezinski (The Grand Chessboard: American Primacy and Its Geostrategic Imperatives, 1997)

Sir Isaac Newton’s Third Law of Motion states that “for every action there is an equal and opposite reaction.” These precepts of physics can also be used in the social sciences, specifically with reference to social relations and geo-politics.

America and Britain, the Anglo-American alliance, have engaged in an ambitious project to control global energy resources. Their actions have resulted in a series of complicated reactions, which have established a Eurasian-based coalition which is preparing to challenge the Anglo-American axis.

Encircling Russia and China: Anglo-American Global Ambitions Backfire

Quote:“Today we are witnessing an almost uncontained hyper use of force — military force — in international relations, force that is plunging the world into an abyss of permanent conflicts. As a result we do not have sufficient strength to find a comprehensive solution to any one of these conflicts. Finding a political settlement also becomes impossible. We are seeing a greater and greater disdain for the basic principles of international law. And independent legal norms are, as a matter of fact, coming increasingly closer to one state’s legal system. One state and, of course, first and foremost the United States, has overstepped its national borders in every way.”

-Vladimir Putin at the Munich Conference on Security Policy in Germany (February 11, 2007)

What American leaders and officials called the “New World Order” is what the Chinese and Russians consider a “Unipolar World.” This is the vision or hallucination, depending on perspective, that has bridged the Sino-Russian divide between Beijing and Moscow.

China and Russia are well aware of the fact that they are targets of the Anglo-American alliance. Their mutual fears of encirclement have brought them together. It is no accident that in the same year that NATO bombarded Yugoslavia, President Jiang Zemin of China and President Boris Yeltsin of Russia made an anticipated joint declaration at a historic summit in December of 1999 that revealed that China and the Russian Federation would join hands to resist the “New World Order.” The seeds for this Sino-Russian declaration were in fact laid in 1996 when both sides declared that they opposed the global imposition of single-state hegemony.

Both Jiang Zemin and Boris Yeltsin stated that all nation-states should be treated equally, enjoy security, respect each other’s sovereignty, and most importantly not interfere in the internal affairs of other nation-states. These statements were directed at the U.S. government and its partners.

The Chinese and Russians also called for the establishment of a more equitable economic and political global order. Both nations also indicated that America was behind separatist movements in their respective countries. They also underscored American-led amibitions to balkanize and finlandize the nation-states of Eurasia. Influential Americans such as Zbigniew Brzezinski had already advocated for de-centralizing and eventually dividing up the Russian Federation.

Both the Chinese and Russians issued a statement warning that the creation of an international missile shield and the contravention of the Anti-Ballistic Missile Treaty (ABM Treaty) would destabilize the international environment and polarize the globe. In 1999, the Chinese and Russians were aware of what was to come and the direction that America was headed towards. In June 2002, less than a year before the onslaught of the “Global War on Terror,” George W. Bush Jr. announced that the U.S. was withdrawing from the ABM Treaty.

On July 24, 2001, less than two months before September 11, 2001, China and Russia signed the Treaty of Good-Neighbourliness and Friendly Cooperation. The latter is a softly worded mutual defence pact against the U.S., NATO, and the U.S. sponsored Asian military network which was surrounding China. [1]

The military pact of the Shanghai Treaty Organization (SCO) also follows the same softly worded format. It is also worth noting that Article 12 of the 2001 Sino-Russian bilateral treaty stipulates that China and Russia will work together to maintain the global strategic balance, “observation of the basic agreements relevant to the safeguard and maintenance of strategic stability,” and “promote the process of nuclear disarmament.” [2] This seems to be an insinuation about a nuclear threat posed from the United States.

Standing in the Way of America and Britain: A “Chinese-Russian-Iranian Coalition”

As a result of the Anglo-American drive to encircle and ultimately dismantle China and Russia, Moscow and Beijing have joined ranks and the SCO has slowly evolved and emerged in the heart of Eurasia as a powerful international body.

The main objectives of the SCO are defensive in nature. The economic objectives of the SCO are to integrate and unite Eurasian economies against the economic and financial onslaught and manipulation from the “Trilateral” of North America, Western Europe, and Japan, which controls significant portions of the global economy.

The SCO charter was also created, using Western national security jargon, to combat “terrorism, separatism, and extremism.” Terrorist activities, separatist movements, and extremist movements in Russia, China, and Central Asia are all forces traditionally nurtured, funded, armed, and covertly supported by the British and the U.S. governments. Several separatist and extremist groups that have destabilized SCO members even have offices in London.

Iran, India, Pakistan, and Mongolia are all SCO observer members. The observer status of Iran in the SCO is misleading. Iran is a de facto member. The observer status is intended to hide the nature of trilateral cooperation between Iran, Russia, and China so that the SCO cannot be labeled and demonized as an anti-American or anti-Western military grouping.

The stated interests of China and Russia are to ensure the continuity of a “Multi-Polar World.” Zbigniew Brzezinski prefigured in his 1997 book The Grand Chessboard: American Primacy and the Geostrategic Imperatives and warned against the creation or “emergence of a hostile [Eurasian-based] coalition that could eventually seek to challenge America’s primacy.” [3] He also called this potential Eurasian coalition an “‘antihegemonic’ alliance” that would be formed from a “Chinese-Russian-Iranian coalition” with China as its linchpin. [4] This is the SCO and several Eurasian groups that are connected to the SCO.

In 1993, Brzezinski wrote “In assessing China’s future options, one has to consider also the possibility that an economically successful and politically self-confident China — but one which feels excluded from the global system and which decides to become both the advocate and the leader of the deprived states of the world — may decide to pose not only an articulate doctrinal but also a powerful geopolitical challenge to the dominant trilateral world [a reference to the economic front formed by North America, Western Europe, and Japan].” [5]

Brzezinski warns that Beijing’s answer to challenging the global status quo would be the creation of a Chinese-Russian-Iranian coalition: “For Chinese strategists, confronting the trilateral coalition of America and Europe and Japan, the most effective geopolitical counter might well be to try and fashion a triple alliance of its own, linking China with Iran in the Persian Gulf/Middle East region and with Russia in the area of the former Soviet Union [and Eastern Europe].” [6] Brzezinski goes on to say that the Chinese-Russian-Iranian coalition, which he moreover calls an “antiestablishmentarian [anti-establishmentarian] coalition,” could “be a potent magnet for other states [e.g., Venezuela] dissatisfied with the [global] status quo.” [7]

Furthermore, Brzezinski warned in 1997 that “The most immediate task [for the U.S.] is to make certain that no state or combination of states gains the capacity to expel the United States from Eurasia or even to diminish significantly its decisive arbitration role.” [8] It may be that his warnings were forgotten, because the U.S. has been repealed from Central Asia and U.S. forces have been evicted from Uzbekistan and Tajikistan.

“Velvet Revolutions” Backfire in Central Asia

Central Asia was the scene of several British-sponsored and American-sponsored attempts at regime change. The latter were characterised by velvet revolutions similar to the Orange Revolution in Ukraine and the Rose Revolution in Georgia.

These velvet revolutions financed by the U.S. failed in Central Asia, aside from Kyrgyzstan where there had been partial success with the so-called Tulip Revolution.

As a result the U.S. government has suffered major geo-strategic setbacks in Central Asia. All of Central Asia’s leaders have distanced themselves from America.

Russia and Iran have also secured energy deals in the region. America’s efforts, over several decades, to exert a hegemonic role in Central Asia seem to have been reversed overnight. The U.S. sponsored velvet revolutions have backfired. Relations between Uzbekistan and the U.S. were especially hard hit.

Uzbekistan is under the authoritarian rule of President Islam Karamov. Starting in the second half of the 1990s President Karamov was enticed into bringing Uzbekistan into the fold of the Anglo-American alliance and NATO. When there was an attempt on President Karamov’s life, he suspected the Kremlin because of his independent policy stance. This is what led Uzbekistan to leave CSTO. But Islam Karamov, years later, changed his mind as to who was attempting to get rid of him.

According to Zbigniew Brzezinski, Uzbekistan represented a major obstacle to any renewed Russian control of Central Asia and was virtually invulnerable to Russian pressure; this is why it was important to secure Uzbekistan as an American protectorate in Central Asia.

Uzbekistan also has the largest military force in Central Asia. In 1998, Uzbekistan held war games with NATO troops in Uzbekistan. Uzbekistan was becoming heavily militarized in the same manner as Georgia was in the Caucasus. The U.S. gave Uzbekistan huge amounts of financial aid to challenge the Kremlin in Central Asia and also provided training to Uzbek forces.

With the launching of the “Global War on Terror,” in 2001, Uzbekistan, an Anglo-American ally, immediately offered bases and military facilities to the U.S. in Karshi-Khanabad.

The leadership of Uzbekistan already knew the direction the “Global War on Terror” would take. To the irritation of the Bush Jr. Administration, the Uzbek President formulated a policy of self-reliance. The honeymoon between Uzbekistan and the Anglo-American alliance ended when Washington, D.C. and London contemplated removing Islam Karamov from power. He was a little too independent for their comfort and taste. Their attempts at removing the Uzbek President failed, leading eventually to a shift in geo-political alliances.

The tragic events of Andijan on May 13, 2005 were the breaking point between Uzbekistan and the Anglo-American alliance. The people of Andijan were incited into confronting the Uzbek authorities, which resulted in a heavy security clampdown on the protesters and a loss of lives.

Armed groups were reported to have been involved. In the U.S., Britain, and the E.U., the media reports focused narrowly on human rights violations without mentioning the covert role of the Anglo-American alliance. Uzbekistan held Britain and the U.S. responsible accusing them of inciting rebellion.

M. K. Bhadrakumar, the former Indian ambassador to Uzbekistan (1995-1998), revealed that the Hezbut Tahrir (HT) was one of the parties blamed for stirring the crowd in Andijan by the Uzbek government. [9] The group was already destabilizing Uzbekistan and using violent tactics. The headquarters of this group happens to be in London and they enjoy the support of the British government. London is a hub for many similar organizations that further Anglo-American interests in various countries, including Iran and Sudan, through destabilization campaigns. Uzbekistan even started clamping down on foreign non-governmental organizations (NGOs) because of the tragic events of Andijan.

The Anglo-American alliance had played its cards wrong in Central Asia. Uzbekistan officially left the GUUAM Group, a NATO-U.S. sponsored anti-Russian body. GUUAM once again became the GUAM (Georgia, Ukraine, Azerbaijan and Moldava) Group on May 24, 2005.

On July 29, 2005 the U.S. military was ordered to leave Uzbekistan within a six-month period. [10] Literally, the Americans were told they were no longer welcome in Uzbekistan and Central Asia.

Russia, China, and the SCO added their voices to the demands. The U.S. cleared its airbase in Uzbekistan by November, 2005.

Uzbekistan rejoined the CSTO alliance on June 26, 2006 and realigned itself, once again, with Moscow. The Uzbek President also became a vocal advocate, along with Iran, for pushing the U.S. totally out of Central Asia. [11] Unlike Uzbekistan, Kyrgyzstan continued to allow the U.S. to use Manas Air Base, but with restrictions and in an uncertain atmosphere. The Kyrgyz government also would make it clear that no U.S. operations could target Iran from Kyrgyzstan.

Major Geo-Strategic Error

It appears that a strategic rapprochement between Iran and America was in the works from 2001 to 2002. At the outset of the global war on terrorism, Hezbollah and Hamas, two Arab organizations supported by Iran and Syria, were kept off the U.S. State Department’s list of terrorist organizations. Iran and Syria were also loosely portrayed as potential partners in the “Global War on Terror.”

Following the 2003 invasion of Iraq, Iran expressed its support for the post-Saddam Hussein Iraqi government. During the invasion of Iraq, the American military even attacked the Iraqi-based Iranian opposition militia, the Mujahedin-e Khalq Organization (MEK/MOK/MKO). Iranian jets also attacked the Iraqi bases of the MEK in approximately the same window of time.

Iran, Britain, and the U.S. also worked together against the Taliban in Afghanistan. It is worth mentioning that the Taliban were never allies of Iran. Up until 2000, the Taliban had been supported by the U.S. and Britain, working hand in glove with the Pakistani military and intelligence.

The Taliban were shocked and bewildered at what they saw as an American and British betrayal in 2001 — this is in light of the fact that in October, 2001 they had stated that they would hand over Osama bin Laden to the U.S. upon the presentation of evidence of his alleged involvement in the 9/11 attacks.

Zbigniew Brzezinski warned years before 2001 that “a coalition allying Russia with both China and Iran can develop only if the United States is shortsighted enough to antagonize China and Iran simultaneously.” [12] The arrogance of the Bush Jr. Administration has resulted in this shortsighted policy.

According to The Washington Post, “Just after the lightning takeover of Baghdad by U.S. forces three years ago [in 2003], an unusual two-page document spewed out of a fax machine at the Near East bureau of the State Department. It was a proposal from Iran for a broad dialogue with the United States, and the fax suggested everything was on the table — including full cooperation on nuclear programs, acceptance of Israel and the termination of Iranian support for Palestinian militant groups.” [13]

The White House impressed by what they believe were “grand victories” in Iraq and Afghanistan merely ignored the letter sent through diplomatic channels by the Swiss government on behalf of Tehran.

However, it was not because of what was wrongly perceived as a quick victory in Iraq that the Bush Jr. Administration pushed Iran aside. On January 29, 2002, in a major address, President Bush Jr. confirmed that the U.S. would also target Iran, which had been added to the so-called “Axis of Evil” together with Iraq and North Korea. The U.S. and Britain intended to attack Iran, Syria, and Lebanon after the 2003 invasion of Iraq. In fact immediately following the invasion, in July 2003, the Pentagon formulated an initial war scenario entitled “Theater Iran Near Term (TIRANNT).”

Starting in 2002, the Bush Jr. Administration had deviated from their original geo-strategic script. France and Germany were also excluded from sharing the spoils of war in Iraq.

The intention was to act against Iran and Syria just as America and Britain had used and betrayed their Taliban allies in Afghanistan. The U.S. was also set on targeting Hezbollah and Hamas. In January of 2001, according to Daniel Sobelman, a correspondent for Haaretz, the U.S. government warned Lebanon that the U.S. would go after Hezbollah. These threats directed at Lebanon were made at the start of the presidential term of George W. Bush Jr., eight months before the events of September 11, 2001.

The conflict at the United Nations Security Council between the Anglo-American alliance and the Franco-German entente, supported by Russia and China, was a pictogram of this deviation.

American geo-strategists for years after the Cold War had scheduled the Franco-German entente to be partners in their plans for global primacy. In this regard, Zbigniew Brzezinski had acknowledged that the Franco-German entente would eventually have to be elevated in status and that the spoils of war would have to be divided with Washington’s European allies.

By the end of 2004, the Anglo-American alliance had started to correct its posture towards France and Germany. Washington had returned to its original geo-strategic script with NATO playing an expanded role in the Eastern Mediterranean. In turn, France was granted oil concessions in Iraq.

The 2006 war plans for Lebanon and the Eastern Mediterranean also point to a major shift in direction, a partnership role for the Franco-German entente, with France and Germany playing a major military role in the region.

It is worth noting that a major shift occurred in early 2007 with regard to Iran. Following U.S. setbacks in Iraq and Afghanistan (as well as in Lebanon, Palestine, Somalia, and former Soviet Central Asia), the White House entered into secret negotiatiations with Iran and Syria. However, the dye has been cast and it would appear that America will be unable to break an evolving military alliance which includes Russia, Iran, and China as its nucleus.

The Baker-Hamilton Commission: Covert Anglo-American Cooperation with Iran and Syria?

Quote:“America should also strongly support Turkish aspirations to have a pipeline from Baku in [the Republic of] Azerbaijan to Ceyhan on the Turkish Mediterranean cost serve as [a] major outlet for the Caspian Sea basin energy sources. In addition, it is not in America’s interest to perpetuate American-Iranian hostility. Any eventual reconciliation should be based on the recognition of a mutual strategic interest in stabilizing what currently is a very volatile regional environment for Iran [e.g., Iraq and Afghanistan]. Admittedly, any such reconciliation must be pursued by both sides and is not a favor granted by one to the other. A strong, even religiously motivated but not fanatically anti-Western Iran is in the U.S. interest, and ultimately even the Iranian political elite may recognize that reality. In the meantime, American long-range interests in Eurasia would be better served by abandoning existing U.S. objections to closer Turkish-Iranian economic cooperation, especially in the construction of new pipelines...”

-Zbigniew Brzezinski (The Grand Chessboard: American Primacy and Its Geostrategic Imperatives, 1997)

The recommendations of the Baker-Hamilton Commission or the Iraq Study Group (ISG) are not a redirection in regards to engaging Iran, but a return to the track that the Bush Jr. Administration had deviated from as a result of the delusions of its hasty victories in Afghanistan and Iraq. In other words, the Baker-Hamilton Commission was about damage control and re-steering America to the geo-strategic path originally intended by military planners that the Bush Jr. Administration seems to have deviated from.

The ISG Report also subtly indicated that adoption of so-called “free market” economic reforms be pressed on Iran (and by extension Syria) instead of regime change. The ISG also favoured the accession of both Syria and Iran to the World Trade Organization (WTO). [14] It should also be noted, in this regard, that Iran has already started a mass privatization program that involves all sectors from banking to energy and agriculture.

The ISG Report also recommends an end to the Arab-Israeli Conflict and the establishment of peace between Israel and Syria. [15]

The joint interests of Iran and the U.S. were also analysed by the Baker-Hamilton Commission. The ISG recommended that the U.S. should not empower the Taliban again in Afghanistan (against Iran). [16] It should also be noted that Imad Moustapha, the Syrian ambassador to the U.S., the Syrian Foreign Minister, and Javad Zarif, the Iranian representative to the United Nations, were all consulted by the Baker-Hamilton Commission. [17] The Iranian Ambassodor to the U.N., Javad Zarif, has also been a middle man between the U.S. and Iranian governments for years.

It is worth mentioning that the Clinton Administration was involved in the track of rapprochement with Iran, while also attempting to keep Iran in check under the “dual-containment” policy directed against Iraq and Iran. This policy was also linked to the 1992 Draft Defence Guidance paper written by people within the Bush Sr. and Bush Jr. Administrations.

It is worth noting that Zbigniew Brzezinski had stated as far back as 1979 and again in 1997 that Iran under its post-revolutionary political system could be co-opted by America. [18] Britain also ensured Syria and Iran in 2002 and 2003 that they would not be targeted and encouraged their cooperation with the White House.

It should be noted that Turkey has recently signed a pipeline deal with Iran that will take gas to Western Europe. This project includes the participation of Turkmenistan. [19] It would appear that this cooperation agreement between Tehran and Ankara points to reconciliation rather than confrontation with Iran and Syria. This is in line with what Brzezinski in 1997 claimed was in America’s interest.

Also, the Anglo-American sponsored Iraqi government has recently signed pipeline deals with Iran.

Once again, America’s interests in this deal should be questioned, as should the high opinions being given about Iran by the puppet leaders of Iraq and Afghanistan.

Something’s Amiss...

The media attention given in North America and Britain to the positive comments made about Tehran by Anglo-American clients in Baghdad and Kabul is sinister.

Although these comments from Baghdad and Kabul about the positive role Iran plays in Iraq and Afghanistan are not new, the media attention is. President George W. Bush Jr. and the White House criticized the Iraqi Prime Minister for saying Iran plays a constructive role in Iraq in early-August of 2007. The White House and the North American or the British press would usually just ignore or refuse to acknowledge these comments. However, this was not the case in August, 2007.

The Afghani President, Hamid Karzai, during a joint press conference with George W. Bush Jr. stated that Iran was a positive force in his country. It is not odd to hear that Iran is a positive force inside Afghanistan because the stability of Afghanistan is in Iran’s best interests. What comes across as odd are “when” and “where” the comments were made. White House press conferences are choreographed and the place and time of the Afghani President’s comments should be questioned. It also so happens that shortly after the Afghani President’s comments, the Iranian President arrived in Kabul in an unprecedented visit that must have been approved by the White House.

Iran’s Political Leverage

In regards to Iran and the U.S., the picture is blurry and the lines between cooperation and rivalry are less clear. Reuters and the Iranian Student’s News Agency (ISNA) have both reported that the Iranian President may visit Baghdad after August 2007. These reports surfaced just before the U.S. government started threatening to label the Iranian Revolutionary Guard Corps as a special international terrorist organization. Without insinuating anything, it should also be noted that the Revolutionary Guard and the U.S. military have also had a low-key history of cooperation from Bosnia-Herzegovina to Taliban-controlled Afghanistan.

The Iranian President has also invited the presidents of the other four Caspian states for a Caspian Sea summit in Tehran. [20] He invited the Turkmen president while in Turkmenistan and later the Russian and Kazakh presidents at the August of 2007 SCO summit in Kyrgyzstan. President Aliyev, the leader of the Republic of Azerbaijan (Azarbaijan) was also personally invited during a trip by the Iranian President to Baku. The anticipated Caspian Sea summit may be similar to the one in Port Turkmenbashi, Turkmenistan between the Kazakh, Russian, and Turkmen presidents where it was announced that Russia would not be cut out of the pipeline deals in Central Asia.

Iranian leverage is clearly getting stronger. Officials in Baku also stated that they will expand energy cooperation with Iran and enter the gas pipeline deal between Iran, Turkey, and Turkmenistan that will supply European markets with gas. [21] This agreement to supply Europe is similar to a Russian energy transport deal signed between Greece, Bulgaria, and the Russian Federation. [22]

In the Levant, Syria is involved in energy-related negotiations with Ankara and Baku and important talks have started between American officials and both Tehran and Damascus. [23]

Iran has also been involved in diplomatic exchanges with Syria, Lebanon, Turkey, and the Republic of Azerbaijan. Additionally, starting in August 2007, Syria has agreed to reopen Iraqi oil pipelines to the Eastern Mediterranean, through Syrian territory. [24] The recent official visit of Iraqi Prime Minister Al-Maliki to Syria has also been described as historical by news sources like the British Broadcasting Corporation (BBC). Also, Syria and Iraq have agreed to build a gas pipeline from Iraq into Syria, where Iraqi gas will be treated in Syrian plants. [25] These agreements are being passed as the sources of tensions between Baghdad and the White House, but they are doubtful. [26]

Iran and the Gulf Cooperation Council (GCC) are also planning on starting the process for creating an Iranian-GCC free trade zone in the Persian Gulf. In the bazaars of Tehran and amongst the political circle of Rafsanjani there are also discussions about the eventual creation of a single market between Iran, Tajikistan, Armenia, Iraq, Afghanistan, and Syria. The American role in these processes in regards to Afghanistan, Iraq, and the GCC should be explored.

Under President Nicholas Sarkozy, France has indicated that it is willing to engage the Syrians fully if they gave specific guarantees in regards to Lebanon. These guarantees are linked to French economic and geo-strategic interests.

In the same period of time as the French statements about Syria, Gordon Brown indicated that Britain was also willing to engage in diplomatic exchanges with both Syria and Iran. Heidemarie Wieczorek-Zeul, the German Minister of Economic Cooperation and Development, has also been involved in talks with Damascus on mutual projects, economic reform, and bringing Syria closer to the European Union. These talks, however tend to be camouflaged by the discussion between Syria and Germany in regards to the mass exodus of Iraqi refugees, resulting from the Anglo-American occupation of their country. The French Foreign Minister is also expected in Tehran to talk about Lebanon, Palestine, and Iraq. Despite the war-mongering by the U.S. and more recently by France, this has all led to speculation of a potential about-turn in regards to Iran and Syria. [27]

Then again, this is part of the two-pronged U.S. approach of preparing for the worst (war), while suing for the diplomatic capitulation of Syria and Iran as client states or partners. When large oil and weapons deals were signed between Libya and Britain, London said that Iran should follow the Libyan example, as has the Baker-Hamilton Commission.

Has the March to War been Interrupted?

Despite talks behind closed doors with Damascus and Tehran, Washington is nonetheless arming its clients in the Middle East. Israel is in an advanced state of military preparedness for a war on Syria.

Unlike France and Germany, Anglo-American ambitions pertaining to Iran and Syria are not one of cooperation. The ultimate objective is political and economic subordination.

Moreover, either as a friend or foe, America cannot tolerate Iran within its present borders. The balkanization of Iran, like that of Iraq and Russia, is a major long-term Anglo-American goal.

What lies ahead is never known. While there is smoke in the horizon, the U.S.-NATO-Israeli military agenda will not necessarily result in the implementation of war as planned.

A “Chinese-Russian-Iranian coalition” — which forms the basis of a global counter-alliance — is emerging. America and Britain rather than opting for outright war, may choose to reel in Iran and Syria through macro-economic manipulation and velvet revolutions.

War directed against Iran and Syria, however, cannot be ruled out. There are real war preparations on the ground in the Middle East and Central Asia. A war against Iran and Syria would have far-reaching worldwide implications.

Mahdi Darius Nazemroaya is an independent writer based in Ottawa specialising on the Middle East and Central Asia. He is a Research Associate of the Centre for Research on Globalization (CRG).


[1] Treaty of Good-Neighborliness and Friendly Cooperation Between the People’s Republic of China and the Russian Federation, signed and entered into force July 16, 2001, P.R. of China-Russian Federation, Ministry of Foreign Affairs of the People’s Republic of China.

The following are treaty articles that are relevant to the mutual defence of China and Russia against American-led encirclement and efforts to dismantle both nations;

The Chinese side supports the Russian side in its policies on the issue of defending the national unity and territorial integrity of the Russian Federation.

The Russian side supports the Chinese side in its policies on the issue of defending the national unity and territorial integrity of the People’s Republic of China.


The Russian side reaffirms that the principled stand on the Taiwan issue as expounded in the political documents signed and adopted by the heads of states of the two countries from 1992 to 2000 remain unchanged. The Russian side acknowledges that there is only one China in the world, that the People’s Republic of China is the sole legal government representing the whole of China and that Taiwan is an inalienable part of China. The Russian side opposes any form of Taiwan’s independence.

The contracting parties shall not enter into any alliance or be a party to any bloc nor shall they embark on any such action, including the conclusion of such treaty with a third country which compromises the sovereignty, security and territorial integrity of the other contracting party. Neither side of the contracting parties shall allow its territory to be used by a third country to jeopardize the national sovereignty, security and territorial integrity of the other contracting party.

Neither side of the contracting parties shall allow the setting up of organizations or gangs on its own soil which shall impair the sovereignty, security and territorial integrity of the other contrasting party and their activities should be prohibited.

When a situation arises in which one of the contracting parties deems that peace is being threatened and undermined or its security interests are involved or when it is confronted with the threat of aggression, the contracting parties shall immediately hold contacts and consultations in order to eliminate such threats.

The contracting parties shall work together for the maintenance of global strategic balance and stability and make great efforts in promoting the observation of the basic agreements relevant to the safeguard and maintenance of strategic stability.

The contracting parties shall actively promote the process of nuclear disarmament and the reduction of chemical weapons, promote and strengthen the regimes on the prohibition of biological weapons and take measures to prevent the proliferation of weapons of mass destruction, their means of delivery and their related technology.

[2] Ibid.

[3] Zbigniew Brzezinski, The Grand Chessboard: American Primacy and Its Geostrategic Imperatives (NYC, New York: HarperCollins Publishers, 1997), p.198.

[4] Ibid., pp. 115-116, 170, 205-206.
Note: Brzezinski also refers to a Chinese-Russian-Iranian coalition as a “counteralliance” (p.116).

[5] Zbigniew Brzezinski, Out of Control: Global Turmoil on the Eve of the 21st Century (NYC, New York: Charles Scribner’s Sons Macmillan Publishing Company, 1993), p.198.

[6] Ibid.

[7] Ibid.

[8] Brzezinski, The Grand Chessboard, Op. cit., p.198.

[9] M. K. Bhadrakumar, The lessons from Ferghana, Asia Times, May 18, 2005.

[10] Nick Paton Walsh, Uzbekistan kicks US out of military base, The Guardian (U.K.), August 1, 2005.,12271,1540185,00.html

[11] Vladimir Radyuhin, Uzbekistan rejoins defence pact, The Hindu, June 26, 2006.

[12] Brzezinski, The Grand Chessboard, Op. cit., p.116.

[13] Glenn Kessler, In 2003, U.S. Spurned Iran’s Offer of Dialogue, The Washington Post, June 18, 2006, p.A16.

[14] James A. Baker III et al., The Iraq Study Group Report: The Way Forward — A New Approach Authroized ed. (NYC, New York: Random House Inc., 2006), p.51.

[15] Ibid., pp.51, 54-57.

[16] Ibid., pp.50-53, 58.

[17] Ibid., p.114.

[18] Brzezinski, The Grand Chessboard, Op. cit., p.204.

[19] Iran, Turkey sign energy cooperation deal, agree to develop Iran’s gas fields, Associated Press, July 14, 2007.

[20] Tehran to host summit of Caspian nations Oct.18, Russian News and Information Agency (RIA Novosti), August 22, 2007.

[21] Azerbaijan, Iran reinforce energy deals, United Press International (UPI), August 22, 2007.

[22] Mahdi Darius Nazemroaya, The March to War: Détente in the Middle East or “Calm before the Storm?,” Centre for Research on Globalization (CRG), July 10, 2007.

[23] Ibid.
It is worth noting that Iran has been involved in pipeline deals with Turkey and in negotiation between Syria, Lebanon, Turkey, and the Republic of Azerbaijan in the possible creation of an energy corridor in the Eastern Mediterranean. These deals occurred in the same time frame that both Syria and Iran started talks with the U.S. after the Baker-Hamilton Commission’s report.

[24] Syria and Iraq to reopen oil pipeline link, Agence France-Presse (AFP), August 22, 2007.

[25] Ibid.

[26] Roger Hardy, Why the US is unhappy with Maliki, British Broadcasting Corporation (BBC), August 22, 2007.

[27] Hassan Nafaa, About-face on Iran coming?, Al-Ahram (Egypt), no. 859, August 23-29, 2007.
China sees trade war if U.S. passes currency bill

BEIJING (CNN) -- A bill that will penalize China for allegedly manipulating its currency to gain a trade advantage is headed for a vote in the U.S. Senate Tuesday, adding pressure on China to appreciate the yuan.

China opposes the bill and warns of a trade war if the bill is passed.

"Should the proposed legislation be made into law, the result would be a trade war and that would be a lose-lose situation for both sides," said Vice Foreign Minister Cui Tiankai.

"It would be detrimental to the development of economic ties and might have an adverse impact on bilateral relations."

Vice Minister Cui spoke in a press briefing one day before a high-level meeting in Beijing with his American counterpart, U.S. Assistant Secretary of State Kurt Campbell. The two senior diplomats are expected to discuss bilateral, regional and global issues.

Even if the bill passes in the Senate, it still needs to go through deliberation and vote by the U.S. House of Representatives.

House Speaker John Boehner has signaled his opposition to the bill. "I think it's pretty dangerous to be moving legislation through the United States Congress forcing someone to deal with the value of their currency," Boehner told reporters on Capitol Hill.

"This is well beyond, I think, what the Congress ought to be doing."

The Chinese currency, also known as the renminbi, has appreciated in real terms by over 20% against the U.S. dollar since 2005, when China adopted a "managed float" of the currency.

Bipartisan supporters of the Senate bill say China has not done enough. They claim the renminbi is undervalued by 25-30% against the dollar, which means Chinese exports to the U.S. become 25-30% cheaper, while U.S. goods exported to China are more expensive.
Senate targets China currency controls

Forcing China to revalue its currency, they say, could help re-balance America's trade with China and bring large number of jobs back to the U.S.

"If China continues its predator practices, the future of our children and grandchildren in this country will not be bright," said Charles Schumer, the Democratic senator from New York. Schumer has frequently proposed punitive sanctions on China for keeping its currency artificially undervalued.

Opponents of the Senate bill argue that the currency sanctions would not fundamentally resolve the U.S.-China trade imbalance, nor alleviate unemployment in America.

"A stronger yuan is not going to bring back jobs in labor-intensive, low-tech industries where the U.S. has no real competitive advantage," said Patrick Chovanec, associate professor at Tsinghua University's School of Economics and Management.
Millions to lose unemployment benefits if Congress doesn't act

"Those jobs will go to Bangladesh or Vietnam before they come back to the U.S."

On the eve of the U.S. Senate vote, Vice Minister Cui said China is closely watching the steps the U.S. Congress might take.

"This bill in no way reflects the reality of our economic and trade relations," he said.

"It might have adverse impact in our relations. It will be trade war in which there will be no winners."


China Currency Bill Passes US Senate

Michael Bowman | Capitol Hill

The U.S. Senate has voted 63 to 35 to penalize China for its currency practices after two weeks of heated debate in which many lawmakers accused Beijing of predatory export promotion policies that have cost American jobs. The bill faces an uncertain future in the House of Representatives and has not been endorsed by President Barack Obama, but it already has provoked strong reactions from the Chinese government.

For years, Democratic Senator Charles Schumer of New York has championed efforts to force the U.S. government to take action against China’s undervalued currency. The Currency Exchange Rate Oversight Reform Act would do that by treating currency manipulation as a foreign subsidy, triggering U.S. tariffs on Chinese goods.

Schumer said the stakes are high. “If we continue to lose wealth and jobs to China, we may never recover [economically] as a country. This is serious stuff," he said.

Also backing the bill is Republican Senator Lindsey Graham of South Carolina, who accused Beijing of a host of unfair economic practices. “The institution I need to be protecting is the American workforce, which is having their clock cleaned [is being beaten] by a communist dictatorship that cheats. They [the Chinese government] do not outwork us. They do not outperform us. They steal our intellectual property. They manipulate their currency. They subsidize their industries. So enough is enough," he said.

Opponents of the bill label it misguided and dangerous.

Republican Senator Orrin Hatch of Utah said, “We are telling the world community that the U.S. is turning inward once again, seeking protectionist solutions to global problems. At the same time, we would be injecting further uncertainty into our own economic recovery as our exporters and workers face potential retaliation from one of our leading trading partners [i.e., China].”

Chinese officials have warned against politicizing trade issues, pointing out that the yuan has appreciated relative to the dollar in recent years. Editorials by China’s state-run news media accuse U.S. lawmakers of scapegoating China for America's economic shortcomings.

Some analysts say the World Trade Organization would reject a U.S. bid to treat currency manipulation as a government subsidy. Last month, 50 trade groups representing many of America’s most vibrant export industries argued that the legislation would invite Chinese retaliation and should be rejected.

That concern was echoed by Republican Senator Jim DeMint of South Carolina. “We do not need to start a trade war with China. We need to stop the class warfare that is preventing jobs from being created right here in America," he said.

Senator Schumer had a sharp response. “To those who say it will cause a trade war, we [already] are in a trade war, to those who say China will retaliate, China has far more to lose in this than we do. They will not retaliate big time because it will do even more damage to the Chinese economy. When they are faced with the hard reality [of U.S. tariffs], they then adjust and play fairer," he said.

Last week, President Obama said China has been “gaming” their currency to benefit their exports and disadvantage U.S.-made products sold in China. But he urged caution when it comes to U.S. legislation that might have unintended consequences.

The Republican-controlled House of Representatives has given no indication that it will hold a vote on the currency bill, without which it cannot become law. House Speaker John Boehner says the legislation inappropriately attempts to force countries to alter their handling of their currencies.
The United States vs China: a duel to the debt
By Business Insider 6:35 AM 02/09/2012

In this period of “exceptional uncertainty” (to quote Federal Reserve Chairman Ben Bernanke), where can investors turn for a considered perspective on the current environment? Produced to feed the beast of the 24-hour news cycle, the bulk of financial journalism and commentary today isn’t worth the servers it is stored on. One notable exception to that rule is Buttonwood, the financial markets column of The Economist. Philip Coggan is the columnist — arguably the most influential position in financial journalism (along with the head of Lex at the Financial Times).

Deciphering the headlines
With the developed world facing fiscal and monetary crises, Coggan’s new book, Paper Promises: Debt, Money, and the New World Order, is a veritable enigma machine for investors who wish to decipher today’s headlines (the U.S. edition was released Monday). In an email interview last week, Coggan shared his observations on some of the most pressing topics of the day. In the first of two articles, he explains why the current international monetary system is on its last legs and discusses the possibility of the Chinese renminbi replacing the dollar in a successor system:

“The thesis of the book is that economic history is a battle between creditors and debtors, with the nature of money the territory over which they fight. Money has two core functions; as a means of exchange (paying for your daily Starbucks) and as a store of value (making sure you can still afford a Starbucks in old age). Historically, those two functions have been in conflict; some groups have wanted to expand the supply to encourage economic activity; others have wanted to restrict the supply of money to protect the value of savings. Broadly speaking, the money expanders have been debtors and the money restricters have been creditors.”

Debtors and creditors: a historical struggle
As he makes clear, that dichotomy is at the root of the rise — and fall — of different monetary systems:

Quote:“Over history, creditors have tended to impose systems that control the supply of money — the gold standard, the Bretton Woods system of fixed exchange rates, the euro — that prevent borrowers from repaying their debts in debased currencies. The strain of keeping up this discipline is intense in democracies where more people are debtors. The gold standard broke down in the 1930s, Bretton Woods in the 1970s and the euro is struggling today, as is what might be called the post-Bretton Woods system of independent central banks and inflation targets. A new world order will emerge from the ashes.”
Today, the struggle between debtor and creditor pits the United States — the world’s largest debtor nation — against rising superpower China. With more than $15 trillion in outstanding public debt, Uncle Sam is in hock to China to the tune of a cool $1.1 trillion. In light of these numbers and China’s growing confidence, it’s not hard to imagine that the relationship between the two nations will be instrumental in shaping a new monetary order. How fast will it emerge and how far will it go? Could we witness the renminbi (China’s currency) replace the dollar as the world’s reserve currency? I asked Buttonwood.

A long way behind
“Could we see the renminbi replace the US as the reserve currency in our lifetime? It depends on how long you think you will live. Reserve currency status is not just a matter of having the largest economy; it is a function of liquidity and trust in the legal system. In both cases, the renminbi is a long way behind. Remember that sterling was still being used as a reserve currency in the 1950s, 60 years after the US overtook Britain.”

Nevertheless, the future stability of the dollar is at risk, as projected increases in unfunded liabilities related to Social Security and Medicare/Medicaid threaten to upend a delicate equilibrium that is based on trust and confidence. That problem — serious as it is — is compounded by a fractious political class that is unable (or unwilling) to address the problem in a mature manner. Since optimism is a trait of the American character, let’s take a “glass half-full” approach. What are the reasons to believe that the U.S. can tackle its debt problem effectively? I asked Buttonwood.

Three hopeful signs
“The most hopeful signs for the US in dealing with its debt problems are threefold; demography, economic vitality and energy. America has a higher birth rate than Europe and (at the moment) benefits from lots of immigration. Whereas in Italy there are currently 3 people of working age for every pensioner, in the US there are 4.6. By 2050, there will be only 1.5 Italian workers per pensioner but the US will have 2.6, better than much of Europe today. Secondly, the US is in the forefront of new industries like software, biotechnology and alternative energy that could boost productivity in the future. Since economic growth is a function of a) worker numbers and b) productivity, both are positive news. Third, the recent development of shale gas makes the US much more energy sufficient than Europe.”

The old continent: No question about it, Europe is in a real jam right now. In our concluding article, Buttonwood lays out one way in which the European sovereign debt crisis may play out and discusses whether a new gold standard would make a good replacement to the current regime of floating fiat currencies. Finally, he highlights the extraordinary shift by which orthodox thinking in the U.S. regarding the currency has been turned on its head — stay tuned.

China may overtake the U.S., but three American companies are set to dominate the world.
[Image: conspiracy_theory.jpg]
02-10-2012, 02:36 AM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
Interesting posts, thanks h3rm35.
An error does not become truth by reason of multiplied propagation, nor does truth become error because nobody sees it.
Mohandas Gandhi

Each of us is put here in this time and this place to personally decide the future of humankind.
Did you think you were put here for something less?
Chief Arvol Looking Horse
02-10-2012, 05:39 AM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
Excellent posts h3rm35. I think it's one of those situations, like Iraq was, where there is more than one reason to embargo and then attack Iran. All parties involved basically conspire to make it happen to everyone's advantage - except of course for the Iranian people.
02-11-2012, 08:55 PM, (This post was last modified: 07-06-2012, 04:53 AM by h3rm35.)
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
Just for later reference, I´m going to throw in this map of US military bases around Iran:
[Image: American-military-bases-around-Iran.jpg]

War Plan Iran: The US Finally Admits Its Criminal Bankruptcy.
“Are they trying to develop a nuclear weapon? No.”

By Finian Cunningham

Global Research, January 9, 2012

Officially, America is now bankrupt: financially, economically, politically – and morally. Its criminal aggression towards Iran is just one of many parts of a jigsaw that add up to a clear and grotesque picture of what the United States of America now represents in the 21st Century world.

The numbers and pictures for these constituent parts of this odious jigsaw puzzle are well known. But what has become glaringly clear is just how integrated the official image of the US now is. Bankrupt.

Terminally in debt, mass poverty at record levels, rampant militarism, draconian curbs on civil liberties, government by the rich for the rich, and lately the reactionary, debased cat-fight that passes for political debate among Republican contenders for the Presidency. Cringing is the sight of super wealthy career politicians throwing sand in each other’s eyes to scrabble up the pole for yet further personal accumulation of capital; disturbing is the easy way that psychopathic targeting of imagined enemies whether at home or abroad is worn like a badge of honour. It is a sign of how depraved the American political mind has become when would-be presidents can so openly talk of conducting foreign policy in terms of unquestioned international aggression.

Of course, this kind of political and moral bankruptcy is not just confined to those seeking office. It is the coin of those who are already in office.

In a report in the New York Times Monday we have the startling admissions that, taken together, show that the US government should be certified as criminal (if further proof were needed) [1].

First we have the top US military man confirming that long-averred war plans against Iran are indeed going ahead.

The NYT: “When asked on [CBS’s] Face the Nation about the how difficult it would be to take out Iran’s nuclear ability in a military strike, Gen. Martin Dempsey, the chairman of the Joint Chiefs of Staff, said: ‘Well, I would rather not discuss the degree of difficulty and in any way encourage them to read anything into that. But I will say that my responsibility is to encourage the right degree of planning, to understand the risks associated with any kind of military option, in some cases to position assets, to provide those options in a timely fashion. And all those activities are going on.’”

In other words, the US is preparing for war.

Ironically, in the above lengthy article about the imminent opening of Iran’s second uranium enrichment plant at Qom, located under a mountain and impregnable from attack, the New York Times buries General Dempsey’s admission deep within the folds of its paragraphs perhaps in a bid to make it impregnable from attack by sane readers. Granted, the bellicose talk from US Commander-in-Chief Barack Obama and his administration of all options on the table has become so routine that the editors at the NYT have probably become inured to criminal admissions and so don’t think them worth any higher prominence that a final paragraph.

But here is the second part of the equation that adds up to definite criminality.

In the same story, the New York Times quotes US Defence Secretary Leon Panetta making what should be a startling admission: that Iran does not have a nuclear weapons programme.

Panetta says: “Are they [Iran] trying to develop a nuclear weapon? No.”

That Panetta finally admits what many people around the world know to be true, including American intelligence agencies in at least two US National Intelligence Estimates in 2007 and 2010 – that is, that Iran is not attempting to develop a nuclear weapon, should be a front-page headline. Especially when taken together with General Dempsey’s disclosure that war plans are afoot. From its own admission, therefore, the US government is pushing the world into possibly a World War III scenario on the basis of a totally spurious claim that even its own top brass do not believe.

Reflecting the bankruptcy that has corroded the US political establishment is the way that the New York Times – America’s self-styled premier newspaper – glides over these nuggets of self-indictment as if they were worthless banalities.

So if Iran is not even trying to develop a nuclear weapon, as Panetta now admits, what then is the criminal US warmongering predicated on?

Unofficially, the real reason is imperialist rivalry with other powers (Russia and China in particular) in the energy-rich Persian Gulf and Central Asia regions, and the attempt to engineer “regime change” in Iran to one that is pliant with Washington’s geopolitical designs.

Officially, for what it is worth, it seems now that the US is not happy even with the mere suspicion that Iran maybe, just maybe, might one day capable of developing nuclear capability.

This is where facts can be helpful. As a signatory to the Nuclear Non-Proliferation Treaty, Iran has the legal right to develop nuclear capability for civilian purposes. This is what Iran has consistently said it is doing and what countless UN inspections of facilities over many years, including the new plant at Qom, have verified. The enrichment of uranium constitutes “nuclear capability” and is an essential part of harnessing nuclear energy for civilian energy. Iran should be congratulated for this achievement given years of gratuitous sanctions by the US its Western allies.

But the way the US government and its Western allies put it, Iran’s legitimate nuclear capability is made to sound like a diabolical threat.

Panetta again: “But we know that they’re trying to develop a nuclear capability. And that’s what concerns us.”

There you have it. The United States can drop nuclear weapons on civilians, possess up to 10,000 nuclear warheads, supply its allies illegally with such weapons and continue to violate the purpose of the NPT by not disarming its nuclear arsenal – yet if a country uses the provisions of the NPT legitimately to pursue nuclear capability then it is reviled and made a target for an illegal war of aggression, most probably with nuclear weapons.

This is depravity-turned-foreign policy – emanating from supposedly the most democratic government in the world.

In that way, the unseemly Republican Party cat-fight between Romney et al is but a symptom of the chronically bankrupt body politic that is American government in the 21st Century.

UNSTABLE GEOPOLITICAL CHESSBOARD: India Joins NATO, Gulf Cooperation Council Against Syria
Saturday, February 11, 2012, Rabi-ul-Awal 18, 1433
by M D Nalapat

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Gamal Abdel Nasser in Egypt...made no secret of his distaste for the sheikhs and monarchs who ruled over several countries, all of whom had close geopolitical links with the countries that today lead the NATO military alliance. As a reaction, the Royal Houses began to patronize the religious groups opposed to Nasserism, support that reached elevated levels during the 1980s, when Zbigniew Brezezinski and later Robert Casey implemented the strategy of using religious groups to battle the foes of the US.

The UN resolution sponsored by NATO is in its essence a surrender document. Given the fate of Muammar Kaddafy, it is no wonder that this has been rejected by the Assad government. In Libya, after the NATO-assisted takeover of the country by armed groups by mid-2011, several thousand former officials have been killed or jailed.

Indeed, both Russia and China have shown themselves to be far more reliable partners than the NATO powers, who welcomed Hosni Mubarak getting toppled and going to prison, despite the fact that the Egyptian strongman had been pursuing NATO-friendly policies from the start of his rule.

Altogether, the region seems headed for great instability. Hopefully, bloodshed can be avoided, although the odds are that a conflict may break out, between Syria and Turkey and between Iran and Israel. Rather than adopt a neutral position, the Government of india has shown by the Syria vote that it intends to go along with NATO.

Just as it did in the case of Libya, the Arab League (AL) has made it clear that it favours a change in the regime in Damascus. This is hardly surprising, as the Baath Party which rules Syria has the same ideology as the party headed by Saddam Hussein did in Iraq, that of ultimately overthrowing the Royal Houses which rule in the Gulf Cooperation Council (GCC) states.

Indeed, although both Iraq and Syria subsequently evolved into personalised governments led by a single individual (Saddam Hussein and Hafez Assad), the Baath ideology was at its root motivated by the secular Arab nationalism exemplified by Gamal Abdel Nasser in Egypt. He made no secret of his distaste for the sheikhs and monarchs who ruled over several countries, all of whom had close geopolitical links with the countries that today lead the NATO military alliance. As a reaction, the Royal Houses began to patronize the religious groups opposed to Nasserism, support that reached elevated levels during the 1980s, when Zbigniew Brezezinski and later Robert Casey implemented the strategy of using religious groups to battle the foes of the US.

Indeed, from the early years of the 20th century, an alliance between religious groups in the Arabian peninsula and the UK had developed. During the 1950s,the purpose of this alliance was to weaken the secular Arab nationalists, by calling them less than faithful to the tenets of the great faith that they were born into, Islam.

During the 1980s, the target was the USSR, specifically in Afghanistan.

Later on,9/11 led to a temporary breakdown of the alliance between the US and the UK and religious groups. For a few years, there was a backlash against Wahabbism, the austere creed that was so helpful a century ago in weakening the hold of the Turkish caliphate in the Arab world. Efforts were made to reform school curricula, and to weed out religious extremists from the key slots into which they had been placed in the past. However, all this got reversed once the 2003 attack on Iraq took place. Once again, the secular - albeit authoritarian - elements such as Saddam Hussein became the principal enemy, to fight whom the NATO powers once again turned to the very religious establishments that they had put under suspicion after 9/11. With the coming of the Arab Spring and the opportunity this unrest provided to make an end of secular authoritarians such as Muammar Kaddafy and next Bashar Assad, once again a 1980s-style alliance has formed between Wahabbi
zealots and NATO.

As in the past, this alliance has been of immense benefit to the Wahabbis, who have become key - often dominant - components of the governments that have been formed across the region in the wake of the Arab Spring. In Libya, it was Nicholas Sarkozy who joined with David Cameron to ensure the fall of the secular Gaddafy and his replacement by a large number of armed fighter groups, most of whom owe allegiance to Wahabbism.

Ironically, while in France Sarkozy has banned the face veil (thereby hitting at personal freedom in a democracy), those whom he helped to power in Benghazi have imposed their version of Sharia Law there.

All across Syria, efforts are on to bring in local versions of Sharia Law, replacing the secular and pan-Libyan codes that had been in place during the four decades when Muammar Kaddafy ruled Libya.

In Tunisia as well, secular lifestyles and regulations are facing an unprecedented challenge, as is the case in Egypt. Even Turkey has changed. The people of that ancient and noble country know that they will never be accepted into the European Union. The fact that an overwhelming majority of the Turkish population is Muslim scares several European countries, especially France, Germany and Austria, although of course they never admit to this in public. As a consequence, the population of Turkey has joined its government in becoming less European and more conservative.

The rejection by Europe has also made Turkey turn once again to the Arab world. These days, Ankara is even more influential than Teheran in the region, as is being shown in Syria, where Turkey has come down on the side of those demanding the ouster of Bashar Assad. In this, Ankara is on the same side as the Arab League, which too wants Bashar to quit and a government to be formed that would be dominated by the majority Sunni population of the country, rather than by the minority Shia. Alawites is the community into which the Assads were born.

Indeed, the Arab League has been highly influential in getting India to join hands with them and with NATO in the UN Security Council. The resolution brought forward by the Arab League would, if implented, make it impossible for not just Bashar Assad but the whole of the present Syrian government to continue to rule, which is why it is being opposed by Damascus.

The UN resolution sponsored by NATO is in its essence a surrender document. Given the fate of Muammar Kaddafy, it is no wonder that this has been rejected by the Assad government. In Libya, after the NATO-assisted takeover of the country by armed groups by mid-2011, several thousand former officials have been killed or jailed.

Those who run Syria now know that this will be their fate as well, no matter what the promises that are being made to them now are. Hence they are likely to battle to the last, unlike Kaddafy, who foolishly believed in his sons when they told him that a partnership with NATO was possible. The son most responsible for Kaddafy’s humiliation and death, Seif, is now in a cage in Misurata, not sure each morning if he will be allowed to survive the night. It was Seif who took seriously the sweet words that he heard from European intermediaries, and who ensured that his father surrendered to the US and the UK his WMD, his nuclear materials, and his defense secrets. Today, these two powers are unconcerned at his fate. After all, his use is over. Now what does it matter if Seif is alive or dead? “Human rights” is only a doctrine intended for selective application.

While Muammar Kaddafy went down without a fight, will the same happen in the case of Bashar Assad? The Syrian leader knows that the fate intended for him - including by most Arab rulers - is the same as that which befell the Libyan dictator.

His best chance of escape is to create enough trouble elsewhere that the attention of his enemies gets diverted to internal issues. Should the Shia situation go out of control in Saudi Arabia and Bahrain, should the Kurds once again get restive in Turkey, and the Palestinians in Jordan, then certainly attention will shift from Daraa and Homs in Syria. The question is: does the Syrian regime any longer have the capacity to create such disturbances? Or has it become exhausted, which is what Turkey, Qatar and Saudi Arabia are hoping. The three are the regional powers most eager to see the Shia-dominated regime in Damascus replaced by one where the Sunnis - especially the Wahabbis - call the shots.

However, within each there are strong groups unhappy with their governments. Egyptians in particular have become a revolutionary force in the GCC, mixing with local populations and calling for Tahrir Square to be repeated in other Arab capitals.

India has joined hands with the NATO powers and the Arab League in calling for regime change in Syria. While this decision has been justified on the grounds that there are large expatriate populations in the GCC, and consequently India needs to adopt the GCC line on regional issues, the reality is that a buyer of petroleum as large as India can never be cold-shouldered by the GCC.

Indeed, it is precisely because China is an even bigger purchaser of petropoducts than India that Beijing knows that there will not be sinificant diplomatic damage as a consequence of standing by Bashar Assad. Indeed, both Russia and China have shown themselves to be far more reliable partners than the NATO powers, who welcomed Hosni Mubarak getting toppled and going to prison, despite the fact that the Egyptian strongman had been pursuing NATO-friendly policies from the start of his rule.

It's clear that the NATO powers are fair-weather friends, and China and Russia want to show the Arab world that they are not. That they stand by their allies in bad times as well as good. Given the complexity of the situation in the region, the Manmohan Singh government would have been best advised to abstain from voting, rather than go along with NATO.

However, UPA Chairperson Sonia Gandhi usually adopts pro-NATO positions, and hence perhaps the PM had no choice. Once Bashar Assad falls - if he does - the attack will move on to Iran and the Khamenei-Ahmedinejad duo.

Altogether, the region seems headed for great instability. Hopefully, bloodshed can be avoided, although the odds are that a conflict may break out, between Syria and Turkey and between Iran and Israel. Rather than adopt a neutral position, the Government of india has shown by the Syria vote that it intends to go along with NATO.

New Military Coalitions directed against Syria and Iran: Leading U.S. Officials Flock To Bulgaria Amid Mideast War Threats

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U.S. Secretary of State visited Bulgaria on February 5 to discuss that nation's contribution to NATO's war effort in Afghanistan, the intensification of joint military training and exercises, pressuring the host country into dropping Russian-made arms in favor of Western ones and the further sabotaging of energy deals - natural gas and nuclear - between Bulgaria and Russia.

The topic of ongoing developments in the Middle East was also discussed. In 2006 Clinton's predecessor Condoleezza Rice secured the use of several military bases in the nation, including the Graf Ignatievo and Bezmer air bases. A year earlier a similar arrangement was reached with neighboring Romania for the use of the Mihail Kogălniceanu Air Base near Constanta on the Black Sea. The latter was employed by the Pentagon for the 2003 invasion of Iraq and since for the war in Afghanistan.

China's Xinhua News Agency wrote ahead of Clinton's visit that, "Analysts believe there is no doubt that Bulgaria will respond positively to Clinton's foreign policy, even if they are related to the issues in Iran or Syria."

A Bulgarian news source subsequently revealed that two days after Clinton's departure from Sofia a delegation of U.S. officials including Deputy Assistant Secretary of Defence for European and NATO Policy James Townsend, Deputy Assistant Secretary of State in the Bureau for European and Eurasian Affairs Marie Yovanovitch and Major General Mark Schissler from U.S. European Command visited the Bulgarian Foreign Ministry.

The Standart news agency wrote that the "extraordinary visit has additionally fed rumours about coming military operations in the Middle East and the formation of new coalitions of the kind existing against Iraq in 2003."

In addition to recent complementary efforts to enlist the South Caucasus nations of Georgia and Azerbaijan in support of military actions against Iran, and perhaps Syria as well, the U.S. and its NATO allies are adding to air and naval bases in Iraq, Afghanistan and the Persian Gulf monarchies others from which to strike Tehran and Damascus.
US Sabotage of Iran’s Currency: A New Twist of the Screw to War

by Finian Cunningham

A new twist of the screw on Iran has emerged following the latest US sanctions aimed at the Islamic Republic’s vital oil economy – specifically destabilising the country’s currency and its ability to conduct normal domestic business.

Iran’s currency, the riyal, was thrown into turmoil – losing 10-12 per cent of its value against foreign currencies – days after US President Barack Obama signed off new sanctions against the Persian Gulf country’s Central Bank. The slide in value is just the latest drop in a prolonged, precipitous fall.

Since last September, when Western governments resumed browbeating diplomacy towards Iran over its legitimate civilian nuclear energy programme, the Iranian riyal has lost 35 per cent – more than a third – of its value.

Following the latest US sanctions, the Iranian currency is now trading at 16,8000 riyals to the US dollar. One year ago, the currency was trading at 10,500 riyals to the greenback. That represents a slump of 60 per cent – caused by the foreign policy meddling of Western governments and Washington in particular.

In any rational calculation, this attack on the economy of a sovereign state by foreign powers can be rightfully seen as a threat to its vital interests – yet another act of war in a mounting list of deeply hostile acts, including a host of covert assassinations and abductions of Iranian scientists and military personnel, terrorist sabotage of infrastructure, and invasion of Iranian territory with US spy drones, as well as overt threats of imminent military attack on the country. The US sale of $60 billion of weapons to Saudi Arabia at the end of last month can also be seen as part of Washington’s campaign of aggression.

The Iranian government and its Central Bank are putting on a brave face in light of the currency destabilisation, denouncing the US sanctions as a “laughing stock” and claiming that it has ample foreign reserves from several years of record oil prices.

Nevertheless, the massive destabilisation of the country’s currency is causing serious disruption in daily commercial and civilian life. Currency traders in the capital, Tehran, are reportedly unable to keep up with the plummeting exchange rates; some businesses are dealing only in dollars, seeing the national currency as a liability; and people are resorting to selling household possessions in order to store up foreign cash reserves.

The disruptive impact is also hitting wide-ranging sectors, from stoking house price inflation to undermining customary regional trade. Despite hostility from US-backed Gulf governments, Iranian small businessmen have long-held traditional links with neighbouring countries, such as Bahrain and the United Arab Emirates, selling textiles and food items. This trade is now being jeopardized from the havoc of uncertain currency exchange.

Officially, the US has entitled itself to legally impose penalties on any foreign entities and businesses involved in transactions with Iran’s Central Bank. Since the Iranian Central Bank oversees and facilitates trade by the nationally owned oil companies, the new US sanctions, signed into law on New Year’s Eve, will undoubtedly deal a severe blow to Iran’s oil industry. Some 80 per cent of Iran’s national revenues are earned from its abundant oil and gas resources – the third largest in the world behind Saudi Arabia and Iraq.

The Islamic Republic has limited oil-refining capacity – one of the reasons why it is keen to develop civilian nuclear energy. Most of its earnings from hydrocarbons are derived from crude oil exports. Major buyers of Iranian crude include China, India, Japan and South Korea, as well as the European Union. Before the latest US sanctions, Washington and its allies, Britain and France, had already instated bilateral sanctions against Iranian oil companies and banks. With Washington now targeting Iran’s Central Bank, the impact will entail multilateral prohibitions that will close the net on Iranian Asian markets. A comparable impact can be expected on Iran’s nascent partnerships in Latin America.

A similar move against Iran’s Central Bank is being contemplated by the European Union in the coming weeks. If that happens, then Iran’s economic lifeline to the world economy will be severed. But on the short term, it seems, the orchestrated choking of Iran’s oil industry by a handful of Western powers is aimed at destabilising the country’s currency to an unbearable degree.

Given the latest provocation in a long list of acts of aggression it is understandable that Iran recently conducted a 10-day military exercise – successfully testing its own cruise missiles – in the Strait of Hormuz. Some one-third of the world’s maritime trade in crude oil passes through this narrow channel in the Persian Gulf. Iran has warned that if its oil economy is choked or if the country comes under attack then it will close off the Strait, which falls into its territorial waters.

But, in the context of systematic Western sanctions and destabilisation over trumped-up claims about Iran’s non-existent nuclear weapons programme, it is surely risible that Iranian warnings regarding the Strait of Hormuz are being portrayed perversely in the Western mainstream media as “acts of provocation”. After test-firing a new surface-to-air missile during its military exercises, the Financial Times reported: ‘Iran raises tensions with missile test’. Such double-think in the so-called quality Western press is a bit like excoriating a victim of gang rape for reaching for the pepper spray.

Finian Cunningham is Global Research’s Middle East and East Africa correspondent.
[Image: conspiracy_theory.jpg]
02-14-2012, 12:38 AM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
hello Guys Good information....))
02-17-2012, 09:14 PM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
from Tom Burghardt @ Antifascist Calling...
[Image: bush-obama-joker.jpg]
Iran Escalation: All the Elements for War Are Coming Together

With all the bluster of late in Western media that President Obama is assiduously working to "restrain" Israel from launching a preemptive attack on Iran, recent developments should put paid the lies of this dog-and-pony show.

Last Sunday during an interview with NBC News, the president made it clear that "all options" regarding plans for a joint U.S.-Israeli attack "are on the table." Far from distancing his government from the strident rhetoric emanating from Tel Aviv, Obama added that the administration is working "in lockstep" with Israel to "prevent Iran from getting a nuclear weapon."

Never mind that unlike Israel, which is estimated to possess upwards of 200 nuclear weapons, as a signatory of the Nuclear Nonproliferation Treaty Iran is perfectly within its rights under international law to enrich uranium for peaceful purposes.

Indeed in December 2003, the Islamic Republic signed an additional protocol authorizing IAEA inspectors to make intrusive, snap inspections of their nuclear facilities and have expressed a willingness to negotiate an end to the Western-manufactured "standoff."

In our Orwellian Empire however, "diplomacy" is a convenient cover--and political talking point--for war and regime change. "Again," Obama told NBC News, "our goal is to resolve this diplomatically. That would be preferable. We're not going to take options off the table, though."

The president followed-up his threats on Monday when he signed an executive order freezing "all Iranian government and financial institutions' assets that are under U.S. jurisdiction," Bloomberg News reported.

According to the White House, Obama took the additional step towards cratering Iran's economy and cited "'deceptive practices' of the Iranian central bank in hiding transactions of sanctioned parties and its failure to prevent money laundering, concluding that Iran activities pose an 'unacceptable risk' to the international financial system."

If only Obama's "neocon-lite" regime had taken similar measures to rein-in the fraudulent and patently "deceptive practices" of the big Western capitalist financial firms that continue to pose an "unacceptable risk" to the economic and social well-being of the global proletariat!

Nigel Kushner, the CEO of the London-based Whale Rock Legal told Bloomberg that "the practical impact is less important than the message it sends to Iran." The analyst went on to say that the new executive order is "a declaration of economic warfare, to the extent that it's not already been declared," Bloomberg averred.

Accordingly, the asset freeze blocks "all property and interests in property belonging to the Iranian government, its central bank, and all Iranian financial institutions, even those that haven't been designated for sanctions by the U.S. Treasury Department," and is one more sign that "hope and change" fraudsters in Washington have taken these steps as deliberate provocations.

This is spelled out quite clearly by neocon Mark Dubowitz, the executive director of the oxymoronic Foundation for Defense of Democracies (FDD), which has rightly been described as the successor organization of the infamous Project for the New American Century.

Last summer, an exposé of the organization by Eli Clifton at Think Progress revealed that FDD's über-rich donors include individuals who, like Obama, march "in lockstep" with Israel's Likud party.

According to Clifton's research, FDD sugar daddies include: U.S. Healthcare CEO Leonard Abramson, the head of the Abramson Family Foundation ($822,000); Edgar M. and Charles Bronfman, heirs to the Seagram liquor fortune (($1,050,000); Home Depot cofounder Bernard Marcus ($600,000); mortgage backed securities "pioneer," Lewis Rainieri ($350,000); "hedge fund mogul" Michael Steinhardt ($850,000) and Ameriquest owner and former Bush administration ambassador to the Netherlands, Roland Arnall ($1,802,000).

"Most of the major donors," Clifton wrote, are active philanthropists to 'pro-Israel' causes both in the U.S. and internationally," who "helped promote the 'Bush doctrine' which led to the invasion of Iraq" and are doing so today with the ginned-up crisis over Iran.

Dubowitz told Bloomberg that Obama's new executive order was "the logical next step in the 'administration's economic war on the Iranian regime'." He gloated that "freezing assets of Iran's central bank and its government institutions, including the National Iranian Oil Company, makes them 'subject to much tougher enforcement by the U.S. government and the global financial sector'."

In response, Foreign Ministry spokesperson Ramin Mehmanparast told Tehran Times Tuesday, that "the issue of sanctions pursued by Western countries and U.S. officials is not a new issue. The issue... is regarded as a hostile measure and indicates that officials of Western countries, particularly the Americans, have not yet come to know our great nation."

"If illogical pressure and inhumane methods are used to hinder the progress of the country and to prevent it from achieving its rights," Mehmanparast said "they (countries that impose sanctions) will definitely not receive a pleasant response from our nation."

Military Build-Up Accelerates

War is not pursued by economic means alone, however.

On the military front, Navy Times reported last week that the "essence" of a massive war game carried out along the U.S. east coast, "Bold Alligator 2012" was "planning, staging and getting them here--and not a few platoons, not a Marine Expeditionary Unit but an entire Marine Expeditionary Brigade that could number upwards of 14,500 Marines and sailors."

According to the right-wing Israeli publication Debkafile, the "Bold Alligator" drill "is the largest amphibian exercise seen in the West for a decade, staged to simulate a potential Iranian invasion of an allied Persian Gulf country and a marine landing on the Iranian coast."

As part of the exercise, three Marine Corps gunship carriers that practiced an amphibious landing and attacked a "hostile" mechanized enemy division which had "invaded its neighbor."

Practicing alongside their U.S. counterparts, "French, British, Italian, Dutch, Australian and New Zealand military elements are integrated in the drill."

Debkafile reported that "Bold Alligator" is "led by the USS Enterprise nuclear carrier with strike force alongside three amphibian helicopter carriers, the USS Wasp, the USS Boxer and the USS Kearsage."

"On their decks," the Israeli publication averred, "are 6,000 Marines, 25 fighter bombers and 65 strike and transport helicopters, mainly MV-22B Ospreys with their crews. Altogether 100 combat aircraft are involved."

Coinciding with naval exercises currently underway in the Persian Gulf, when the "Bold Alligator" war games end, "the participants are to be shipped out to Persian Gulf positions opposite Iran. Altogether three American aircraft carrier strike groups, the French Charles de Gaulle carrier and four or five US Marines amphibian vessels will be posted there," Debkafile's military sources report.

As war drums beat louder, researcher Rick Rozoff at Stop NATO revealed that during a January 30 meeting, President Obama "met with his Georgian counterpart Mikheil Saakashvili in the Oval Office at the White House for an unprecedented private meeting between the heads of state, a tête-à-tête initiated by Washington."

Rozoff reports that "Obama had summoned the ambitious and erratic Georgian leader to Washington to propose a quid pro quo: The use of Georgian territory for American attacks on Iran in exchange for the U.S. exercising its not inconsiderable influence in Georgia--with a population of only 4.7 million the third largest recipient of American foreign aid--to assist in securing Saakashvili's reelection in next year's presidential poll."

The move was denounced by former Georgian President Eduard Shevardnadze, "who was overthrown by Saakashvili's self-styled Rose Revolution in 2003," a U.S.-financed "civil society coup" that installed an American-educated puppet in power in Tbilisi. Shevardnadze warned, "I don't rule out that to retain the [presidential] chair Saakashvili may join a military campaign against Iran, which would become a catastrophe for our country."

"Georgian analysts and opposition party leaders seconded Shevardnadze's suspicions, specifying that the Saakashvili regime would provide air bases and hospitals, of which a veritable proliferation have appeared in recent months, for such a war effort."

"A Georgian opposition analyst estimated that 30 new 20-bed hospitals and medical clinics were opened last December and that new air and naval sites are being built and modernized, military air fields in Vaziani, Marneuli and Batumi most ominously," Rozoff wrote.

Similarly, The Jerusalem Post, citing a piece that appeared Saturday in The Times, reported that Azerbaijan, which shares a long border with Iran, "is teeming with Mossad agents working to collect intelligence on the happenings within the Islamic Republic."

"This is ground zero for our intelligence work," an anonymous Mossad intelligence operative told The Times. "Our presence here is quiet, but substantial. We have increased our presence in the past year, and it gets us very close to Iran. This is a wonderfully porous country."

One might say, a "wonderfully porous country" for staging terror attacks, as NBC News revealed last week.

According to Richard Engel and Robert Windrem, "deadly attacks on Iranian nuclear scientists are being carried out by an Iranian dissident group that is financed, trained and armed by Israel's secret service, U.S. officials tell NBC News, confirming charges leveled by Iran's leaders."

That group the Mojahedin-e Khalq (MEK), designated a Foreign Terrorist Organization by the U.S. State Department, enjoys considerable support amongst Washington's power elite as The Christian Science Monitor disclosed last summer.

Indeed, "a high-powered array of former top American officials," from Rudy Giuliani to Howard Dean, "have been paid tens of thousands of dollars to speak in support of the MEK."

While Obama administration officials have tried to distance the U.S. secret state from the Mossad's assassination program, as Richard Silverstein noted on the left-wing Tikun Olam web site: "One aspect of this report, however, is misleading. The U.S. officials who confirm Mossad involvement in these plots carefully note that the U.S. is not participating. That, unfortunately is not quite true. The Bush administration allocated $400-million for this black ops war against Iran. A good portion of this is suspected of funding Israel's efforts. So it is highly likely that we are the paymasters for this effort and our denials ring hollow."

But the Iranian terror cult's connections to the CIA don't stop there. In fact, "law enforcement officials have told NBC News that in 1994, the MEK made a pact with terrorist Ramzi Yousef a year after he masterminded the first attack on the World Trade Center in New York City," Engel and Windrem wrote.

"According to the officials, who spoke on condition of anonymity, Yousef built an 11-pound bomb that MEK agents placed inside one of Shia Islam's greatest shrines in Mashad, Iran, on June 20, 1994. At least 26 people, mostly women and children, were killed and 200 wounded in the attack."

Yousef, the nephew of reputed "9/11 mastermind" Khalid Sheik Mohammad, was the top bombmaker for Osama Bin Laden's Afghan-Arab database of disposable Western intelligence assets, also known as Al Qaeda, who had a long history of close collaboration with the CIA and Pakistan's Inter Services Intelligence agency before "going off the reservation" in the early 1990s.

These connections, and links, to Western destabilization operations are hardly historical relics of Washington's anticommunist jihad against the former Soviet Union, as Peter Dale Scott pointed out in The Asia-Pacific Journal: Japan Focus last summer.

Scott noted that "Americans have used al-Qaeda as a resource to increase their influence, for example Azerbaijan in 1993. There a pro-Moscow president was ousted after large numbers of Arab and other foreign mujahedin veterans were secretly imported from Afghanistan, on an airline hastily organized by three former veterans of the CIA's airline Air America."

And today, with foreign fighters flooding into Syria, including Libyan jihadist elements armed and trained by the CIA and MI6, it should hardly come as a shock that Al Qaeda's "emir," Ayman al-Zawahri, in a reprise of Islamist-backed efforts in alliance with the CIA in Afghanistan during the 1980s "urged Muslims in Turkey, Iraq, Lebanon and Jordan to come to the aid of Syrian rebels confronting Assad's forces," Reuters reported Sunday.

Western operations against Syria are viewed as a prelude to an all-out attack on Iran as Michel Chossudovsky and other analysts describe in a new series published by Global Research.

Indeed, U.S. war planners have presented regional military commanders with a target list that include "beyond Iran's nuclear facilities, communications systems; air defense and missile sites; Revolutionary Guard Corps facilities; munitions storage facilities, including those for sea mines (remember the Strait of Hormuz); airfields and aircraft facilities; and ship and port facilities, including midget submarines, missile boats and minelayers," The Washington Post disclosed.

"Aircraft employed," the Post averred, "would include B-2 stealth and B-52 bombers, fighter-bombers and helicopters, along with ship-launched cruise missiles."

In other words, Washington is contemplating a massive air and sea bombardment followed by a land invasion, as the "Bold Alligator 2012" drill suggests, with the express purpose of forcing "regime change" in Tehran.

As analyst Peter Symonds pointed out in the World Socialist Web Site, "While the US and its allies insist that Iran must satisfy 'international concerns' about its nuclear programs, the demands for 'clarification' are endless."

"IAEA inspectors visited Iran on January 29-31 and are due to return for further discussions later this month," Symonds wrote. "No report has been released, but the US and international media nevertheless accused Tehran of 'obfuscation' and 'time wasting'."

Ominously, Haaretz reported that a new dossier "to be issued next month by the International Atomic Energy Agency on Iran's nuclear program is expected to be harsher than the last one, which the IAEA released in November."

According to Haaretz, "the agency's board of governors is scheduled to convene on March 5 in Vienna, the same day on which Prime Minister Benjamin Netanyahu is due to give a speech in Washington at a meeting of the annual policy conference of the pro-Israel lobby AIPAC, the American Israel Public Affairs Committee."

Netanyahu is also scheduled to meet with Obama where talks on the "international response" to the "threat from Tehran" will take center stage. Isn't that a coincidence!

"The reality," the World Socialist Web Site noted, "is that nothing short of complete capitulation to all Washington's demands--not only on the nuclear issue, but its relations with the Syrian government and groups such as Hezbollah and Hamas, as well as its alleged 'interference' in Iraq and Afghanistan--would end the US build-up to war."

"In short," Symonds observed, "Washington is pressing for a regime in Tehran that bows to American economic and strategic interests in the Middle East and Central Asia on every significant issue."

"For all the talk about 'diplomacy' and 'sanctions,' the World Socialist Web Site warned, "the US is recklessly setting course for a war with Iran that threatens to engulf the Middle East and spread internationally."

The clock is ticking...
[Image: conspiracy_theory.jpg]
02-20-2012, 09:41 PM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
Senator Lindsay graham talking about a communist dictator that cheats. Oh the fucking irony.
05-02-2012, 11:38 PM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
CHINA'S RENMINBI VERSUS THE US DOLLAR: People's Bank of China widens trading range of the yuan

By John Chan

Global Research, April 25, 2012

The People’s Bank of China last week widened the yuan’s daily trading band from 0.5 percent to 1 percent. In the short term, the Chinese central bank will continue to intervene in currency markets to ensure that no major fluctuations damage China’s struggling export industries. Nevertheless, the measure is a step toward a more market-based exchange rate that will also internationalise the country’s currency.

US Treasury Secretary Tim Geithner welcomed the move as “very significant and very promising.” The Obama administration has long pressured China to institute a more flexible yuan and further open up its financial sector. International Monetary Fund (IMF) head Christine Lagarde declared: “It’s not a baby step, it’s a very good step in the right direction.”

The Western powers recognise that the yuan reform is part of a broader agenda by the dominant factions within the Chinese Communist Party (CCP) regime to permit global banks and corporations to restructure the country’s remaining large state enterprises, especially protected areas such as banking.

Premier Wen Jiabao had openly criticised the major state banks on April 4. “Let me be frank,” Wen declared, “Our banks earn profit too easily. Why? Because a small number of large banks have a monopoly.” He insisted: “To break the monopoly, we must allow private capital to flow into the finance sector.”

The Chinese central bank has tightly controlled the exchange rate between yuan and the US dollar since 1994 in order to maintain China’s export competitiveness. In 2007, Beijing increased the yuan’s daily trading band from 0.3 percent to 0.5 percent under pressure from Washington to revalue the currency. But the CCP regime halted any further widening of the trading band after the 2008-09 global financial crisis sent Chinese export industries into a tailspin, initially throwing 23 million internal migrant workers out of work.

Last week’s widening of the trading band came after clear signs that exports cannot continue to power China’s rapid economic expansion, as they have done for the past two decades. China’s trade surplus halved in 2011 to just $155 billion, and the current account surplus fell below 4 percent of gross domestic product—down from a peak of 10 percent in 2007.

Before 1994, China’s currency was relatively independent from the Western economies. The currency reform of that year marked a fundamental shift—pegging the yuan to the US dollar, while massively devaluing it to boost exports. The yuan-dollar peg was essential to the transformation of regions such as the Yangtze and Pearl River Deltas into the world’s largest cheap labour manufacturing centres.

China’s foreign currency reserves skyrocketed from $160 billion in 2000 to more than $3 trillion in 2011—due to massive inflows of export earnings and foreign capital. Most of the dollar reserves in turn were sent back to America via the purchase of US bonds—supposedly the safest investment at the time. Apart from $1.2 trillion in US federal bills, China holds some $400 billion worth of bonds in the US government-backed housing giants Freddie Mac and Fannie Mae.

US housing price rises in turn allowed American working class households, which increasingly depended on debt because of declining real wages, to undertake the consumption spending that fuelled production in China. Almost the entire Chinese boom rested on expanding exports. Domestic consumption accounted for just 35.6 percent of China’s GDP in 2011—compared to America’s 70 percent—due to the super-exploitation of Chinese workers.

China’s depressed consumption levels led to the rapid accumulation of capital for investment, which now accounts for half its GDP—compared to the world average of 20 percent. This was viable only because US consumer spending was five times larger than China’s, even as China’s manufacturing output and fixed capital investment grew larger than those of the US.

As the 2008-09 crash demonstrated, any decline in external demand rapidly leads to a crisis of overproduction, factory closures and rising unemployment in China.

The Chinese financial system has been based on export-led production. The destruction of most state-owned enterprises in the 1990s, which used to provide housing and medical coverage for employees, forced workers to save what they could from their low wages in bank deposits. The banks set low interest rates for deposits, which were in turn crucial for the operations of the central bank. It was able to counter inflation and keep the currency stable by buying up the dollars flowing into the country from exports, and issuing bonds in yuan at low interest rates.

In effect, Chinese savings subsidised the entire trade cycle. Some economists described this process as the “export of savings” to the US.

China’s low interest rates also provided cheap credit to fuel a state-led investment boom in industries from telecoms and automobiles to metal manufacturing and infrastructure. Western corporations in these sectors formed joint-ventures and partnerships with Chinese state firms, reaping huge profits.

With the collapse of the US housing and financial bubbles in 2007-08, however, the happy “marriage” of US-China dollar recycling came to an end, and with it the “state-led” capitalist model in China.

Beijing’s stimulus packages, which unleashed trillions of dollars of cheap credit after 2008, only exacerbated the resulting crisis by triggering a speculative property boom and threatening to generate colossal bad debts for the state banks and local governments. Already afflicted by low profit margins before the crisis, Chinese manufacturing profitability dived even further. Investors sought returns from property speculation, rather than production.

In response, the Chinese regime is seeking to further integrate China’s financial and monetary system with the world’s major finance centres such as New York and London in order to attract an influx of international capital and prop up the faltering economy.

Far from resolving the current economic difficulties, China’s closer financial integration will make it ever more vulnerable to the global capitalist crisis and sudden shifts in the world markets. Beijing’s economic policy-making will become ever more subject to the dictates from the major global banks and financial institutions for a deeper assault on the living standards of China’s already exploited workers.
US, Japan strengthen military ties against China
By Peter Symonds
2 May 2012

A bilateral summit between US President Barack Obama and Japanese Prime Minister Yoshihiko Noda in Washington has confirmed steps by the two countries to strengthen their strategic alliance and upgrade joint military activities in Asia. Despite denials by both leaders, the moves are clearly aimed against China.

Their joint statement pledged to “further enhance our bilateral security and defence cooperation.” It also affirmed a commitment to “US strategic rebalancing to the Asia Pacific”, to establish “a more geographically distributed and operationally resilient force posture in the region.”

Obama announced his administration’s “strategic rebalancing” or “pivot” to Asia last November, confirming what had been underway since mid-2009—comprehensive US diplomatic-military efforts to undercut Chinese influence throughout the region. Strengthening US alliances with Japan, South Korea, Australia, and the Philippines as well as military partnerships with India, Indonesia and other countries is central to Washington’s strategy.

In comments prior to the summit, Noda told the Wall Street Journal: “Japan will promote… enhancement of its defence posture in the area, including the Southwestern Islands, in coordination with the US strategy of focusing on the Asia-Pacific region.” The “Southwestern Islands” includes the disputed Diaoyu/Senkaku Islands over which China and Japan clashed diplomatically in 2010. Japan revised its defence guidelines in late 2010 to stress maritime and air surveillance, island defence and greater defence cooperation, particularly with the US.

While the Noda-Obama talks were low-key, Japan’s promise to enhance its regional defence posture in conjunction with the US is significant. Nominally the Japanese government is bound by the so-called pacifist clause of its post-war constitution that has limited the activities of its military to “self defence.” Under pressure from the US to play a greater role, Japan has over the past decade deployed military forces to support the American-led occupations of Afghanistan and Iraq. It has also recently established its first overseas military base since the end of World War II—in Djibouti, a country on the strategically important Horn of Africa, supposedly to combat piracy.

Strengthening the US alliance with Japan is central to Obama’s strategy of containing China. Japan is the third largest economy in the world and more technologically advanced than China. Its defence budget last year was $59.3 billion—the sixth largest in the world and the second largest in Asia after China. Despite its defensive posture, Japan’s military has always been equipped with hi-tech hardware and is organised so it can be rapidly expanded.

Within Japan, there are divisions within the ruling elite, including within Noda’s own Democratic Party of Japan (DPJ), over closer military ties with the US. Former Prime Minister Yukio Hatoyama, who led the Democrats to power for the first time in 2009, advocated a more independent Japanese foreign policy and closer regional relations, especially with China, on which Japan is heavily dependent economically.

Hatoyama was forced to step down in June 2010, in part because the Obama administration refused to renegotiate the relocation of the Futenma Marine Corps airbase off the island of Okinawa—a key DPJ election promise. He was replaced by Naoto Kan, who pledged closer military ties with the US, a promise that Noda maintained after Kan was compelled to resign last year. Huge protests on Okinawa in early 2010, culminating in a rally of 90,000 people, demonstrated not only popular hostility on the island to the Futenma airbase, but broader opposition throughout Japan to any revival of militarism.

The US and Japan announced steps last week to move 9,000 US Marines off Okinawa. About 5,000 will transfer to the US territory of Guam that is to be transformed into “a strategic hub” for the American military in the Pacific. The remainder will be relocated to Hawaii, as well as to Darwin in northern Australia, where up to 2,500 Marines will be stationed on a rotating basis as part an agreement announced last year.

The relocation does not lessen the strategic significance of Okinawa, which will still house 10,000 Marines as well as other US military forces. The move has not resolved the still contentious issue of the relocation of the Futenma base, currently in a densely populated urban area, to another part of Okinawa. But the build up of Guam, which Japan will pay $3.1 billion towards, will now proceed before a final decision on Futenma.

Last week’s meeting of the US-Japan Security Consultative Committee also announced the possible establishment of joint training facilities on Guam and the North Mariana Islands. The reference to “training” is to sidestep the Japanese constitution and blunt domestic opposition in Japan. If these plans proceed, it would mark the first ever permanent Japanese military presence on US territory.

The repositioning of US forces to Guam and northern Australia is part of the Pentagon’s greater focus on South East Asia, especially on controlling the vital sea lanes that China relies upon for energy and raw materials from Africa and the Middle East. US domination of choke points such as the Malacca Strait threatens China with an economic blockade in the event of conflict. The US Navy is preparing to station new littoral warships in Singapore, adjacent to the Malacca Strait.

On Monday, US Secretary of State Hillary Clinton and US Defence Secretary Leon Panetta met with their Philippine counterparts in Manila for top level security talks. Washington has been encouraging the Philippines and other South East Asian countries to take a tougher stance in relation to their territorial disputes with China in the South China Sea. The US has bolstered the Philippine navy and is discussing the use by American forces of Philippine military bases on a rotational basis—a sensitive political issue in the former American colony.

While not taking sides in the current standoff between China and the Philippines over the disputed Scarborough Shoal, Clinton noted: “We oppose the threat or use of force… and we remain in close contact with our ally.” Asked if the US would support the Philippines in a conflict with China, Philippine Foreign Affairs Secretary Albert del Rosario said that the US had expressed the intention “to honour their obligations under the Mutual Defence Treaty.”

The standoff over the Scarborough Shoal underscores the recklessness of the Obama administration’s “pivot” to the Asia Pacific. By deliberately ratchetting up tensions, the US risks a disastrous conflict with China that could be triggered by any one of the many flashpoints in the region.
[Image: conspiracy_theory.jpg]
06-04-2012, 10:19 PM, (This post was last modified: 06-04-2012, 10:22 PM by h3rm35.)
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
AMERICA THREATENS CHINA: Pentagon Prepares for Confrontation in the Asia-Pacific Region

By Rick Rozoff

Global Research, June 3, 2012

In January of this year the three officials in charge of U.S. global military strategy and operations - commander-in- chief President Barack Obama, Secretary of Defense Leon Panetta and Chairman of the Joints Chiefs of Staff General Martin Dempsey - unveiled the 2012 Defense Strategic Guidance, entitled “Sustaining U.S. Global Leadership: Priorities for 21st Century Defense,” which officially confirmed American plans to increase its military presence in the Asia-Pacific region to counter China, now the world's second-largest economy.

Alternately referred to as rebalancing, reemphasis, refocusing and a pivot away from Europe and toward the Asia-Pacific and the Middle East, the new doctrine reflects the past twenty years' consolidation of U.S. military and political control of Europe through the expansion of the North Atlantic Treaty Organization and the subjugation of North Africa and the Middle East except for, at least for the present, Syria and Iran through the creation of U.S. Africa Command, NATO's Mediterranean Dialogue and Istanbul Cooperation Initiative military partnerships and its ten-and-a-half- year-old Operation Active Endeavor in the Mediterranean, and the wars against Iraq and Libya.

Having not so much neutralized opposition - there were no effective challengers to U.S. geopolitical hegemony in the indicated areas - as eliminated remaining pockets of independence and nonalignment (Yugoslavia, Iraq and Libya), the Pentagon and its allies are free to move against China, having already surrounded Russia through NATO expansion and partnerships from the Baltic Sea to the Black Sea, the South Caucasus to Central Asia, the Arctic Ocean to Mongolia.

On June 1 Pentagon chief Panetta spoke at the eleventh annual Shangri-La Dialogue defense summit in Singapore, where the U.S. has recently gained basing rights for its warships, and reiterated plans to expand, tighten and integrate its alliances with defense treaty partners in the Asia-Pacific: Australia, Japan, New Zealand, the Philippines, South Korea and Thailand. (Taiwan is practically if not formally in that category.)

As the Defense Department's news agency, American Forces Press Service, reported, Panetta emphasized that "Defense policy in the region calls for the U.S. military to expand military-to- military relationships well beyond the traditional treaty allies." The allusion is to the members of the Association of Southeast Asian Nations (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Vietnam and Thailand) not already included in bilateral military alliances with Washington as well as new partners like Afghanistan, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan, Mongolia, Tonga and others supplying troops or transit bases for the U.S.-NATO war in Afghanistan. An old ally, Pakistan, and newly acquired ones, India and Bangladesh, are also within the Pentagon's purview.

In the past few years the U.S. has pulled Association of Southeast Asian Nations (ASEAN) members Cambodia, Laos, Myanmar and Vietnam into its political-military orbit and expanded partnerships with Malaysia and Singapore, which have troops serving under NATO command in Afghanistan along with Australia, Mongolia, New Zealand, South Korea and Tonga.

Panetta's comments in Singapore included the following: "By 2020, the Navy will reposture its forces from today’s roughly 50/50 split between the Atlantic and Pacific to about a 60/40 split between those oceans - including six aircraft carriers, a majority of our cruisers, destroyers, littoral combat ships and submarines.”

To appreciate the scale of what that redeployment portends, it's worth noting the unprecedented and unparalleled military capacity the U.S. has built from the end of World War II to the present, in the process establishing the first and only global military force.

The U.S. has eleven aircraft carriers with attached strike groups; all the world's supercarriers and all but one of its twelve nuclear-powered carriers. (France has the other.) The eleven American supercarriers are the largest warships ever built.

It has 61 guided missile destroyers and 22 guided missile cruisers, all of which are part of or can be upgraded to join the Aegis Combat System, thereby being capable of participating in Washington's worldwide interceptor missile program.

The U.S. Navy also possesses 72 submarines, 18 ballistic and 53 attack models, and 24 frigates, nine amphibious assault ships, seven amphibious transport docks, 12 dock landing ships, four littoral combat ships and scores of other vessels.

Washington has pledged to deploy 60 percent of the above to the Asia-Pacific region in the imminent future.

Ahead of his trip to Singapore, Panetta visited the headquarters of U.S. Pacific Command (PACOM) in Honolulu, Hawaii and American Forces Press Service reported that "There are 330,000 U.S. service members in the Pacific Command area now, and Panetta anticipates the proportion of the total military in the region will rise."

The same source added: "The American military also wants to strengthen power projection capabilities in the region. Panetta said there will be new platforms and capabilities for troops in the area."

U.S. military chief Martin Dempsey is also attending the three-day Shangri-La Dialogue in Singapore and his meetings in the Southeast Asian nation indicate one component of the Pentagon's "power projection" strategy for the Asia-Pacific area. He met with the host country's defense minister, chief of defense and heads of its army, air force and navy and toured the Sembawang Air Base and other military facilities.

His discussions included topics like the regular Commando Sling joint U.S.-Singapore air combat exercises and the imminent deployment of U.S. littoral combat ships to Singapore agreed upon late last year.

Singaporean Defense Minister Ng Eng Hen visited the Pentagon in April, during which Panetta announced the doubling of the number of U.S. warships to be "forward deployed" to Singapore, from two to four, for exercises and operations near the strategic Strait of Malacca.

In the same month the U.S. deployed the first 200 of 2,500 Marines to northern Australia as part of a military buildup which will also include aircraft, warships and drones.

The Philippines is the third Asia-Pacific nation where the Pentagon is securing new bases to contain and ultimately confront China.

In April the U.S. and the Philippines conducted the latest Balikatan military maneuvers with 4,500 American Marines and 2,500 Philippine troops which included an amphibious assault at Ulugan Bay on Palawan Island to rehearse the "recapture" of an island near the Spratly Islands contested by the Philippines and China.

Most of the Asia-Pacific is in the area of responsibility of U.S. Pacific Command, one of six Unified Combatant Commands the Pentagon employs to maintain control of and pre-position for potential military actions throughout the world. It consists of U.S. Army Pacific, U.S. Marine Forces Pacific, U.S. Pacific Fleet and U.S. Pacific Air Forces.

PACOM's website boasts that its geographical reach "encompasses about half the earth’s surface, stretching from the waters off the west coast of the U.S. to the western border of India, and from Antarctica to the North Pole."

Its area of responsibility takes in 36 nations and over half of the world's population.

The website also itemizes American military assets already deployed to the Asia-Pacific:

Some 350,000 military personnel, one-fifth of total U.S. forces.

The U.S. Pacific Fleet, assigned to PACOM, includes six of eleven aircraft carrier strike groups, approximately 180 ships, 1,500 aircraft and 100,000 service members.

U.S. Marine Forces Pacific consists of two-thirds of U.S. Marine Corps combat troops, two Marine Expeditionary Forces and 85,000 personnel.

U.S. Pacific Air Forces has over 40,000 airman and more than 300 aircraft, with an additional 100 aircraft based in Guam.

U.S. Army Pacific has over 60,000 service members and five Stryker combat vehicle brigades.

There are also an estimated 1,200 Special Operations troops assigned to PACOM.

Components of U.S. Pacific Fleet, the U.S. Third Fleet is home-based in California and the Seventh Fleet in Japan. The Seventh Fleet, the largest forward-deployed naval force in the world, has 50 to 60 ships, 350 aircraft and 60,000 Marines and sailors.

U.S. Pacific Air Forces includes the Fifth Air Force in Japan, Seventh Air Force in South Korea, Eleventh Air Force in Alaska and Thirteenth Air Force in Hawaii.

PACOM has three subordinate unified commands: U.S. Forces Japan, U.S. Forces Korea and Alaskan Command.

Pacific Command has in recent years been making inroads into Asian nations that were off-limits during the Cold War period and for the first decade and a half afterward.

PACOM has been running annual Khaan Quest military exercises in Mongolia since 2003, mainly to train Mongolian troops for deployments to Iraq and Afghanistan.

U.S. Army Pacific conducts annual Angkor Sentinel exercises in Cambodia, as with those in Mongolia including troops from American NATO and from other Asia-Pacific allies.

PACOM and its service affiliates also hold regular military exercises elsewhere throughout the Asia-Pacific region.

In January the U.S. and Japan held the latest Keen Edge command post exercise in Japan and Hawaii.

From January 15-February 17 of this year 7,000 U.S, troops and 3,000 from Thailand, Indonesia, Japan, Malaysia, Singapore and South Korea participated in the Cobra Gold 2012 war games in Thailand.

The U.S. and South Korea held their joint Key Resolve and Foal Eagle exercises from February 28 to April 30 (February 28-March 9 and March 1-April 30, respectively) with 11,000 American and over 200,000 South Korean troops.

In March the air forces of the U.S., Thailand and Singapore participated in the Cope Tiger exercise at the Korat Royal Thai Air Force Base.

At the end of the month the three-week U.S.-led Commando Sling air combat exercises in Singapore were begun.

In April the U.S. and India engaged in this year's Malabar naval exercise, the latest in a series of annual drills with that codename, in the Bay of Bengal. The ten-day Malabar 2012 exercise was led by the U.S. Seventh Fleet and included aircraft carrier USS Carl Vinson, guided missile cruiser USS Bunker Hill, guided missile destroyer USS Halsey and American aircraft and a submarine.

In the same month the 7,000-troop U.S.-Philippine Balikatan 2012 exercise was held in the South China Sea.

On May 30 the U.S. began the 18th annual Cooperation Afloat Readiness and Training (CARAT) in Indonesia. The nine-day exercise included a U.S. Navy Task Group and Marine landing force.

Other regular U.S.-led military exercises in the Asia-Pacific include the biennial U.S.-Australia Talisman Sabre and the biennial Rim of the Pacific exercises, the second the largest multinational naval maneuvers in the world. This year's Rim of the Pacific exercise in and near Hawaii will run from June 29 to August 3 and include 24 nations, 42 ships, six submarines, over 200 aircraft and 25,000 personnel.

Having vanquished most all islands of resistance and neutrality in Europe, Africa and the Middle East, the Pentagon is moving its global military machine into the Asia-Pacific for a showdown with China.

Stop NATO e-mail list home page with archives and search engine:
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US-Australia plans for war on China
By James Cogan

A newly published book by journalist David Uren has revealed that the Australian government’s 2009 Defence White Paper contained a “secret chapter” that assessed “Australia’s ability to fight an air-sea battle alongside the United States against China.”

The chapter was omitted from the public version as it contained references to Australian forces assisting the US military to impose a naval blockade of China’s trade routes, and likely Chinese retaliation against targets on Australian soil. The existence of the confidential chapter was prominently reported on the front page of the Australian newspaper on Saturday under the headline “Secret ‘war’ with China uncovered.” Labor’s Defence Minister Stephen Smith was questioned about the revelation on Sunday. While he attempted to dismiss as “nonsense” the report that Australia had plans for war with China, he confirmed that there were both public and secret versions of the White Paper.

Uren, the economics editor of the Australian newspaper, provides no source for his revelation. His book, however, The Kingdom and the Quarry: China, Australia, Fear and Greed, has clearly been written in close consultation with figures in the Australian political, military and diplomatic establishment. It is primarily a discussion of the immense dilemma that confronts the Australian ruling elites as the United States—their key strategic and military ally—pursues an ever more aggressive stance toward China, Australia’s largest trading partner.

Uren wrote that the White Paper envisaged “a very different world, in which Australian naval operations alongside the United States in, say the South China Sea, could lead to direct Chinese attack on Australia with missiles, mining of ports and cyber-attacks. The capability of China to reach out 5,000 kilometres and touch Australia was a new element of the strategic environment.”

The missing chapter, Uren wrote, “assumed that there would be blockades distant from China designed to control its sea routes and stop the flow of natural resources on which its industrial engine depends… Part of the defence thinking is that in the event of a conflict with the United States, China would attempt to destroy Pine Gap, the US-Australia signals facility near Alice Springs, which is crucial for guiding US military operations in Asia.”

The war preparations motivated the White Paper’s recommendation that more than $100 billion be spent over the next decade or so to equip the Australian military with new submarines, destroyers, jet fighters and other advanced hardware.

Significantly, Uren notes that while then Australian Prime Minister Kevin Rudd had aggressively supported the White Paper—against opposition from his military intelligence advisors—the Obama administration did not support his diplomatic initiatives in the Asian region. Uren cites the diplomatic cables published by WikiLeaks that revealed Washington opposed Rudd’s advocacy of a so-called “Asia-Pacific Community” which would seek to mediate tensions between the US and China.

Uren, however, does not comment on the US role in the inner-party coup that ousted Rudd on June 23-24, 2010 and installed Julia Gillard as prime minister. He does not reference other diplomatic cables published by WikiLeaks in which Gillard was named by US officials as a potential pro-US alternative to Rudd, and which identified the key Labor conspirators, such as Senator Mark Arbib, as “protected sources” of the US embassy.

In mid-2009, US Secretary of State Hillary Clinton provocatively told a summit of the Association of South East Asian Nations (ASEAN): “I am here to confirm that we [the US] are back and we are here to stay [in Asia].” Her speech at ASEAN was a categorical rejection of calls by figures like Rudd for a US accommodation to China’s ambitions for greater regional influence.

Uren observes that the agreements signed last November between the Obama administration and the Gillard government for a greater US military presence in Australia flow from expectations of future conflict with Beijing. He cites the establishment of a “working group” between the US and Australian militaries in late 2010, “to explore greater military cooperation.”

While Uren does not refer to it, the US Naval War College published a study in January 2011 which detailed Australia’s “numerous advantages” as a base from which the US military could control the vital sea lanes between the Indian and Pacific Oceans in the event of conflict with China. The study’s authors, James Holmes and Toshi Yoshihara, commented that “the Australian government—Washington’s most dependable ally in Asia, alongside Tokyo—would likely prove agreeable to such an arrangement.”

Under Prime Minister Julia Gillard, the Labor government has unconditionally aligned Australia with the Obama administration’s so-called pivot to the Asia-Pacific. Australian ports and airbases are to be upgraded for use by the American military and the Cocos Islands in the Indian Ocean made available as an airbase for US surveillance drones and, potentially, warplanes.

Uren comments that the small scale of the initial US deployments to Australia—just several hundred marines training for six months near the northern city of Darwin—was intended as “a way of mollifying regional reaction.” The announcement over the weekend by US Defence Secretary Leon Panetta that the US Navy will base 60 percent of its fleet in the Asia-Pacific underscores the strategic importance of access to Australian naval bases. Ports in Perth, Darwin and Brisbane will service the US aircraft carrier battle groups and nuclear submarines that threaten China’s access to crucial maritime trading routes.
[Image: conspiracy_theory.jpg]
06-05-2012, 04:18 PM,
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
My middle scroll-wheel finger is about to give out.
06-05-2012, 11:43 PM, (This post was last modified: 06-05-2012, 11:53 PM by h3rm35.)
RE: Currency/Warfare:¨A new world order will emerge from the ashes.¨
then don´t read my threads. this one has over 300 reads right now and your the only one complaining. Topics of this size need a lot of context to be understood
[Image: conspiracy_theory.jpg]

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