IRAN HAS REALLY DONE IT...more deadlier than the nuclear
station..
The Voice (issue 264 -) ran an article beginning, -
Iran has really gone and done it now. No, they haven't
sent their first nuclear
sub in to the Persian Gulf . They are about to launch
something much more deadly -- next week the Iran Bourse will
open to trade oil, not in dollar but in Euros' This
apparently insignificant event has consequences far greater
for the US people, indeed all for us all, than is
imaginable.
Currently almost all oil buying and selling is in
US-dollars through exchanges in London and New York . It is
not accidental they are both US-owned.
The Wall Street crash in 1929 sparked off global depression
and World War II. During that war the US supplied provisions
and ammunitions to all its allies, refusing currency and
demanding gold payments in exchange.
By 1945, 80% of the world's gold was sitting in US
vaults. The dollar became the one undisputed global reserve
currency -- it was
treated world-wide as `safer than gold'. The Bretton
Woods agreement was established.
The US took full advantage over the next decades and
printed dollars like there was no tomorrow. The US exported
many mountains of
dollars, paying for ever-increasing amounts of commodities,
tax cuts for the rich, many wars abroad, mercenaries, spies
and politicians the world over. You see, this did not affect
inflation at home! The US got it all for free! Well, maybe
for a forest or two.
Over subsequent decades the world's vaults bulged at
the seams and more and more vaults were built, just for US
dollars. Each year, the
US spends many more dollars abroad that at home. Analysts
pretty much agree that outside the US , of the savings, or
reserves, of
all other countries, in gold and all currencies -- that a
massive 66% of this total wealth is in US dollars!
In 1971 several countries simultaneously tried to sell a
small portion of their dollars to the US for gold. Krassimir
Petrov, (Ph. D.
in Economics at Ohio University ) recently wrote, 'The
US Government defaulted on its payment on August 15, 1971 .
While popular spin told the story of `severing the link
between the dollar and gold', in reality the denial to
pay back in gold was an act of bankruptcy by the US
Government.' The 1945 Breton Woods agreement was
unilaterally smashed. The dollar and US economy were on a
precipice resembling Germany in 1929.
The US now had to find a way for the rest of the world to
believe and have faith in the paper dollar. The solution was
in oil, in the petrodollar. The US viciously bullied first
Saudi Arabia and then OPEC to sell oil for dollars only --
it worked, the dollar was saved. Now countries had to keep
dollars to buy much needed oil. And the US could buy oil all
over the world, free of charge. What a Houdini for the US !
Oil replaced gold as the new foundation to stop the paper
dollar sinking.
Since 1971, the US printed even more mountains of dollars
to spend abroad. The trade deficit grew and grew. The US
sucked-in much of
the world's products for next to nothing. More vaults
were built.
Expert, Cóilínn Nunan, wrote in 2003, 'The dollar is
the de facto world reserve currency: the US currency
accounts for approximately two thirds of all official
exchange reserves. More than four-fifths of all foreign
exchange transactions and half of all world exports are
denominated in dollars. In addition, all IMF loans are
denominated in dollars.'
Dr Bulent Gukay of Keele University recently wrote,
'This system of the US dollar acting as global reserve
currency in oil trade keeps the demand for the dollar
`artificially' high. This enables the US to carry out
printing dollars at the price of next to nothing to fund
increased
military spending and consumer spending on imports. There
is no theoretical limit to the amount of dollars that can be
printed. As long as the US has no serious challengers, and
the other states have confidence in the US dollar, the
system functions.'
Until recently, the US-dollar has been safe. However, since
1990 Western Europe has been busy growing, swallowing up
central and
Eastern Europe . French and German bosses were jealous of
the US ability to buy goods and people the world over for
nothing. They wanted a slice of the free cake too. Further,
they now had the power and established the euro in late 1999
against massive US-inspired opposition across Europe ,
especially from Britain - paid for in dollars of course. But
the euro succeeded.
Only months after the euro-launch, Saddam's Iraq
announced it was switching from selling oil in dollars only,
to euros only -- breaking
the OPEC agreement.. Iran , Russia , Venezuela , Libya ,
all began talking openly of switching too -- were the
floodgates about to be opened?
Then aero planes flew into the twin-towers in September
2001. Was this another Houdini chance to save the US (petro)
dollar and
the biggest financial/economic crash in history? War
preparations began in the US But first war-fever had to be
created -- and truth was the first casualty.
Other oil producing countries watched-on. In 2000 Iraq
began selling oil in euros. In 2002, Iraq changed all their
petro-dollars in their
vaults into euros. A few months later, the US began their
invasion of Iraq . The whole world was watching: very few
aware that the US
was engaging in the first oil currency, or petro-dollar
war. After the invasion of Iraq in March 2003, remember, the
US secured oil areas first. Their first sales in August
were, of course, in dollars, again. The only government
building in Baghdad not bombed was the Oil Ministry! It does
not matter how many people are murdered -- for the US , the
petro-dollar must be saved as the only way to buy and sell
oil - otherwise the US economy will crash, and much more
besides.
In early 2003, Hugo Chavez, President of Venezuela talked
openly of selling half of its oil in euros (the other half
is bought by the US ). On 12 April 2003, the US-supported
business leaders and some generals in Venezuela kidnapped
Chavez and attempted a coup. The masses rose against this
and the Army followed suit. The coup failed. This was bad
for the US .
In November 2000 the euro/dollar was at $0.82 dollars, its
lowest ever, and still diving, but when Iraq started selling
oil in euros,
the euro dive was halted. In April 2002 senior OPEC reps
talked about trading in euros and the euro shot up. In June
2003 the US occupiers of Iraq switched trading back to
dollars and the euro fell against the dollar again. In
August 2003 Iran starts to sell oil in euros to some
European countries and the euro rises sharply. In the winter
of 2003-4 Russian and OPEC politicians talked seriously of
switching oil/gas sales to the euro and the euro rose. In
February 2004 OPEC met and made no decision to turn to the
euro -- and yes, the euro fell against the dollar. In June
2004 Iran announced it would build an oil bourse to rival
London and New York , and again, the euro rose. The euro
stands at $1.27 and has been climbing of late.
But matters this month became far, far worse for the US
dollar. On 5th May Iran registered its own Oil Bourse, the
IOB. Not only are
they now selling oil in euros from abroad -- they have
established an actual Oil Bourse, a global trading centre
for all countries to buy and sell their oil!
In Chavez's recent visit to London ; he talked openly
about supporting the Iranian Oil Bourse, and selling oil in
euros. When asked in
London about the new arms embargo imposed by the US against
Venezuela , Chavez prophetically dismissed the US as 'a
paper tiger'.
Currently, almost all the world's oil is sold on either
the NYMEX, New York Mercantile Exchange, or the IPE, London
's International
Petroleum Exchange. Both are owned by US citizens and
both sell and buy only in US dollars. The success of the
Iran Oil Bourse makes sense to Europe , which buys 70% of
Iran 's oil. It makes sense for Russia , which sells 66%
of its oil to Europe . But worse for the US , China and
India have already stated they are very interested in the
new Iranian Oil Bourse.
If there is a tactical-nuclear strike on - deja-vu
-`weapons of mass destruction' in Iran , who would bet
against a certain Oil Exchange and more, being bombed too?
And worse for Bush. It makes sense for Europe , China ,
India and Japan-- as well as all the other countries
mentioned above -- to buy and sell oil in Euro's. They
will certainly have to stock-up on euros now, and they will
sell dollars to do so. The euro is far more stable than the
debt-ridden dollar. The IMF has recently highlighted US
economic difficulties and the trade deficit strangling the
US-- there is no way out.
The problem for so many countries now is how to get rid of
their vaults full of dollars, before it crashes? And the US
has bullied so many
countries for so many decades around the world, that many
will see a chance to kick the bully back. The US cannot
accept even 5% of the world's dollars-- it would crash
the US economy dragging much of the world with it,
especially Britain .
To survive, as the Scottish Socialist Voice article stated,
'the US , needs to generate a trade surplus to get out
of this one. Problem is it
can't.' This is spot on. To do that they must force
US workers into near slavery, to get paid less than Chinese
or Indian workers. We all
know that this will not happen.
What will happen in the US ? Chaos for sure. Maybe a
workers revolution, but looking at the situation as it is
now, it is more likely to be a re-run of Germany post-1929,
and some form of extreme-right mass movement will emerge...
Does Europe and China/Asia have the economic independence
and strength to stop the whole world's economies
collapsing with the US ? Their vaults are full to the brim
with dollars. The US has to find a way to pay for its
dollar-imperialist exploitation of the world since 1945..
Somehow, eventually, it has to account for every dollar in
every vault in the world.
Bombing Iran could backfire tremendously. It would bring
Iran openly into the war in Iraq , behind the Shiite
majority. The US cannot
cope even now with the much smaller Iraqi insurgency.
Perhaps the US will feed into the Sunni v Shiite conflict
and turn it into a wider
Middle-East civil-war. However, this is so dangerous for
global oil supplies. Further, they know that this would be
temporary, as some country somewhere else, will establish a
euro-oil-exchange, perhaps in Brussels .
There is one `solution' -- scrap the dollar and print a
whole new currency for the US . This will destroy 66% of the
rest of the world's
savings/reserves in one swoop. Imagine the implications?
Such are the desperate things now swimming around heads in
the White House, Wall Street and Pentagon.
Another is to do as Germany did, just before invading
Poland in 1938. The Nazis filmed a mock Polish Army attack
on Germany , to win hearts and minds at home. But again,
this is a finger in the dam. So, how is the US going to
escape this time? The only global arena of total superiority
left is military. Who knows what horrors lie ahead. A new
world war is one tool by which the US could discipline its
`allies' into keeping the dollar in their vaults.
The task of socialists today is to explain to as many as
possible, especially our class, that the coming crisis
belongs purely to capitalism
and (dollar) imperialism. Not people of other cultures, not
Islam, not the axis of evil or their so-called WMDs. Their
system alone is to blame.
The new Iranian Oil Bourse, the IOB, is situated in a new
building on the free-trade-zone island of Kish , in the
Persian Gulf . It's computers and software are all set
to go. The IOB was supposed to be up and running last March,
but many pressures forced a postponement. Where the pressure
came from is obvious. It was internationally registered on
5th May and supposed to open mid-May, but its opening was
put off, some saying the oil-mafia was involved, along
with much international pressure. Just google
`pertroeuro'
can search for the term Iranian Oil Bourse on wiki and see
what it comes up with.
From now on, anyone in the know will wake up every morning
and, even before coffee, will check out the latest exchange
rate between the euro and dollar.
BigGains !!
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