Oil, Empire And Playing The Great Game

Submitted by Charles Hugh-Smith of OfTwoMinds blog,

Those waiting for the U.S. and its dollar to collapse in a heap may find their own stability is more contingent (and fleeting) than they reckoned.

Many observers (including myself) question the coherence of U.S. foreign policy in the Mideast: The Fatal Incoherence of the Bush/Obama Foreign Policy (June 18, 2014).
 

In my view, the incoherence stems from the intrinsic conflict between traditional (i.e. pre-1941) U.S. foreign policy (based on an uneasy marriage of non-intervention and the explicitly interventionist Monroe Doctrine) and the anti-imperialist values of the Founding Fathers, and the demands of maintaining global hegemony.

The other source of incoherence is the recent policy dominance of an intrinsically incoherent ideology of neo-Conservative Imperialism that is disconnected from both traditional non-interventionist U.S. values and the nuanced demands of maintaining global hegemony.
 

If we strip away these sources of incoherence, we're left with the Deep State playing the Great Game of controlling the master resource, oil. A consistent narrative has little value in the playing of this game, other than for public-relations value, and those seeking a single narrative are inevitably perplexed by the multiple paradoxes and agendas of the Deep State.
 

This leads many observers to declare the Deep State's game plan a disaster.
 

The important question is: which game plan? The incoherent one articulated by the president and his secretary of state? Or the one that nobody lays out because it would be the equivalent of showing everyone at the table all your cards?
 

The real game plan is flexible enough to tolerate multiple inconsistencies and paradoxes. The only goal is controlling the extraction and distribution of oil, and whatever serves this goal is in play. Switching sides, abandoning proxies, cutting deals with enemies--it's all in play, all the time.
 

From this perspective, the game requires constant shifting of strategies in response to what's working and what's not working. If taking down Syria's Assad with proxies didn't work, then move on to Plan B or Plan C. If degrading Iran's influence isn't working, then move on to reproachment (privately at first, of course).
 

In other cases, the strategy is public but the working parts are not necessarily public. Financial sanctions are a good example; beneath the PR bravado and the propaganda war of sanctions and counter-sanctions, one side is getting hurt where it counts (i.e. in the personal fortunes of its Power Elites). If sanctions aren't working, they're replaced with Plan B or C. What Plan B or C might be is only visible between the lines.
 

In other cases, allies are reminded of who controls $40 trillion in financial resources and who controls $2 trillion.
 

The U.S. Deep State isn't collecting "likes." Everyone with a piece on the board has to deal with the U.S. in some fashion, whether they like it or not. Even the cliche of the enemy of my enemy is my friend doesn't explicate the conflicting alliances the U.S. maintains.
 

One need only recall Nixon's visit to China as evidence that all sorts of sacrosanct policies are fluidly jettisoned once the board changes and the Deep State sees the advantages of another arrangement.
 

In the case of Nixon and China, Nixon sought to rearrange the triangle of China, the U.S.S.R. and the U.S. to the advantage of the U.S. and China at the expense of the U.S.S.R.
 

In other cases, the U.S. game is served by disrupting competitors' control of resources; if direct control isn't possible with available assets, then indirect control via global finance is always an option. If that isn't possible, then disrupting competitors' control until other stresses bring them to their knees might work.
 

Everybody with a piece on the board is serving their own best interests. When cutting a deal with an implacable enemy serves your interests better than remaining enemies, that's what you do--consistency doesn't count. Friends, enemies, frenemies--labels, like consistency, don't count.
 

I don't know any more than any other marginalized, non-insider citizen. But just reading between the lines, I see the various Deep States playing 3-D chess and constantly adjusting strategies and game plans in response to other players' moves. I would guess one U.S. Deep State strategy involves disrupting the alliance of Russia, Iran and Syria by whatever means are available, with the goal of securing working relationships of some sort with all three such that energy flows serve the U.S. Deep State agenda.
 

This doesn't mean others' interests aren't being served; arrangements are only stable if they meet all the players' core interests. Costs are raised or reduced, changing the incentives to deal, and at some point the benefits of changing the arrangement outweigh the costs.
 

Just glancing at this map, I'd guess it would serve both the U.S. and Iran to reach some sort of mutually beneficial arrangement.
 

Glancing at this map, it follows that the energy stranglehold Russia currently enjoys on Europe is not permanent:
 

source:

Again, reading between the lines, we can discern these Great Game possibilities:

1. As I described on Monday, I expect oil to plummet at some point as the global economy implodes. As demand and price crash, oil exporters on the thin edge of domestic instability will maintain production in a desperate attempt to keep their welfare states afloat. The Oil Head-Fake: The Illusion that Lower Prices Are Positive.
 

2. This dramatic decline in oil revenues will trigger domestic regime change in nations which are dependent on oil revenues for the maintenance of their welfare state/Armed Forces/Political Elites.

3. Capital restrictions will increasingly be viewed as necessary as nations awaken to the fact that their sovereignty and control of their own assets will be lost if they allow uncontrolled flows of capital in and out of their economy.
 

The currency that will be needed for reserves and to service debts is the U.S. dollar. As demand for USD rises and U.S. imports (i.e. the supply of USD being exported) decline, the value of USD will rise sharply.
 

4. That means the U.S. can outbid other bidders for any global resource. The U.S. funds its Empire by selling its bonds (debt) to those who have traded goods for our dollars. Thus the cost of the Empire is largely borne by other nations as the U.S. exports inflation and its currency in exchange for goods and resources.
 

Until China gains an equivalent advantage (and as I have explained many times, nations with trade surpluses cannot issue reserve currencies), then it will have to bid for resources with earned income. Recall that China's apparently substantial wealth is ultimately based on its currency's peg to the U.S. dollar and an export-dependent economy that will run aground once the global recession kicks in.
 

The Impossibility of China Issuing a Reserve Currency (October 14, 2013)
 

Understanding the "Exorbitant Privilege" of the U.S. Dollar (November 19, 2012)
 

5. Capital controls will be followed by resource controls. The export of energy, food and minerals will be limited as a matter of necessity. The excuses given won't matter; there will be no alternative. Governments which let their own populaces starve in order to ship food overseas will be overthrown by whatever means are necessary. As Bob Marley observed, a hungry mob is an angry mob. That's how Bastilles get torn down, brick by brick, by enraged mobs.

That means there will be far fewer resources available for export.
 

6. The clock is ticking on China's moment in the sun. Its citizens' monumental ambitions will be thwarted by the limits facing all consuming nations, and as the costs of its aging (and increasingly diabetic) populace ratchet higher, China's resources will be stretched too thin to construct a Global Empire with a reserve currency and decisive hard and soft power.
 

Perhaps if Mao hadn't struck down an entire generation in the Cultural Revolution and China had started integrating its economy and ambitions 20 years earlier, that hard and soft power might have been assembled. But now there are too many demands on China's financial resources and too many imbalances in its corrupt, centrally planned financial house of cards. Its stash of foreign reserves is modest compared to the demands of Empire and a populace of 1.2 billion people with expectations raised to the sky.
 

When competition between the U.S. and China comes up, I always ask this: Which nation's Power Elites have made sure their children have green cards and homes in the others' home turf?
 

If the U.S. Power Elites had secured Chinese citizenship for their beloved children and purchased properties in Beijing, then that would be proof that the leadership of the U.S. Empire had lost faith in the Empire's durability and future.
 

But it is the other way round: it is China's leadership which has moved its capital and offspring to Canada and the U.S. Indeed, having U.S./Canadian passports or green cards for one's children is unequivocal evidence of membership in the Chinese Elite.
 

In many cases, core goals can be met by doing nothing more than waiting patiently for already-visible internal instabilities to blossom in competing nations and alliances. Those waiting for the U.S. and its dollar to collapse in a heap may find their own stability is more contingent (and fleeting) than they reckoned.
 

The game is many boards deep. Nobody has god-like powers, every player makes mistakes and miscalculations. The advantages and arrangements are all contingent and temporary; those with the most flexibility and the deepest spectrum of assets will eventually increase their influence at the expense of those with weaker hands and those who fail to respond promptly and decisively to new configurations on the multiple boards in play.

Of related interest:
 

Ukraine: Follow the Energy (March 4, 2014)
 

The Systemic Sources of Geopolitical Turmoil: Instability, Fragmentation, Resource Wars(June 30, 2014)
 

The Great Game: Geopolitics and Oil (October 19, 2010)
 

The Great Game: Regime Change in Syria (September 6, 2012)

Comments

[vmromk]

END the CRIMINAL operation called the "Federal Reserve."

[knukles]

"Questioning policy coherence"?

[SafelyGraze]

the 'great game' has become too difficult for humans to play

just sayin

hugs,
watson

[Rainman]

good grief, you got junked for telling the truth ?

[meistergedanken]

Nah, he got junked for using "just sayin'", which ranks right up there with "Wow.  Just Wow." and "Sigh." for most annoying internet phrases.

[SafelyGraze]

+1 for "sigh"

[Bangalore Equit...]

Listen.

Peak oil is a "MYTH"!

[LawsofPhysics]

Got calories available for consumption?  Everything else is fucking noise.  Some people/countries will have calories that they can consume, others will not.  Some will live, most will not, same as it ever was...

[sleigher]

It's not that annoying...   just sayin...

[Thought Processor]

Questions:  

1.  Who are 'our' real adversaries?

2.  Which team our 'we' on?

3.  And lastly, who are 'we' and what to we stand for?

In a real fight the most dangerous enemy is the one you can't see.

[KnuckleDragger-X]

'The great game' is what the people in the diplomatic and high govermental circles call it. For the people living in the real world it's a cross between a mexican standoff https://en.wikipedia.org/wiki/Mexican_standoff and a gunfight in a dark room. Everybody is seeking advantage but doing it in the worst possible way.

[Escrava Isaura]

vmromk,

Did you read the article?

[Racer]

Conservatives want to scrap the Human Rights Act

http://www.mirror.co.uk/news/ampp3d/uk-scraps-human-rights-act-4350443#i...

[NoDebt]

Good for Cameron.  If I was him I wouldn't be signing a goddamed thing that Europe was shoving under my nose, either.

EVERYTHING that comes from outside a nation should be treated with suspicion.  Wrap it in the "human rights" banner all you want.  I guarantee it's about control and ceding sovereignty at it's core.

[KnuckleDragger-X]

The EU appears to be predicated as a mutual suicide pact and Brussels is busy handing out loaded handguns....

[JustObserving]

Many observers (including myself) question the coherence of U.S. foreign policy in the Mideast:

That is because Israel runs US Mideast policy:

Ex-UK FM: ‘Unlimited’ Jewish funds control US policy, block Mideast peace

http://www.timesofisrael.com/ex-uk-fm-unlimited-jewish-funds-control-us-...

Jewish writers confirm that the Iraq War was a war for Israel, not America

“The war in Iraq was conceived by 25 neoconservative intellectuals, most of them Jewish, who are pushing President Bush to change the course of history.

http://nowarforisrael.com/jewish-writers-confirm-that-the-iraq-war-was-a...

[The Phallic Crusader]

Serving Two Flags: Neo-Cons, Israel and the Bush Administration

[JR]

The amazing force of the U.S. as a superpower…from its wars, its petrodollar and reserve currency, to its manipulation of dozens of sovereign countries and its ownership of the IMF and the World Bank et. al… leaves out one outstanding fact. And that fact is that the accumulation of resources and growth of the American Empire does not translate into better lives and better prosperity for its citizens. The reason is that the financial elites who control the Empire take all the benefits for themselves.

This is the role of the Federal Reserve whose owners dictate foreign policy and political legislation to line their pockets and that of Israel. The evidence lies in the contrast between the incredible advances of America post WWII and the deteriorating plight of the American people and their standard of living.

Where, therefore, are the peaceful benefits of this superpower’s strength? They are in the bank accounts of the bankers and the war arsenal of Israel.

In short, the Empire does not belong to the people of America.

[zerophilo]

+1 JR

[JR]

Maybe we were wrong about Lady Gaga; maybe she’s not a filthy harlot; maybe she’s only a spokesman for the oppressed; maybe she deserves a better show contract now that we’ve seen her sensitive side…

…because if you can see and understand how Israel is oppressed then you have grown psychologically.

Again, The Times of Israel:

Lady Gaga: World is wrong about Israel

Tel Aviv was magnificent, star singer says in interview, and its people are ‘in good spirits’

By Lazar Berman September 28, 2014, 7:09 pm 101

“Put your hands up and cheer for yourselves,” she told the crowd. “You are strong, you are brave, you are confident, and I f*cking love you, Israel.”

Read more: Lady Gaga: World is wrong about Israel | The Times of Israel http://www.timesofisrael.com/lady-gaga-world-is-wrong-about-israel/#ixzz3EudqXJ4k

[cluelessminion]

T0 JR:

Lady Gaga's career is on it's last legs.  Her exhortations on Isreal are an attempt to reverse that by appealing to the people who run the media/music industry.  So is her attempt to reinvent herself by singing duets with Tony Bennet.  She went from singing "Poker Face" in meat dresses to singing I got a crush on you in classic gowns.  Won't work.  Her 15 minutes have been up for a while.  Nice try though.

[cluelessminion]

sorry dup.

[Duffy]

Ultimately, while the British did not know how to satisfy both Jews and Arabs, the United Nations (which then had only 46 Member States) proposed a plan to partition Palestine based on the indications that the British had provided. A binational state would be created including a Jewish state, an Arab state and an area "under special international regime" to administer the holy places (Jerusalem and Bethlehem). This project was adopted by Resolution 181 of the General Assembly. [8]

Without waiting for the result of negotiations, the president of the Jewish Agency, David Ben Gurion unilaterally proclaimed the State of Israel immediately recognized by the United States. Arabs in Israeli territory were placed under martial law, their movements were restricted, their passports confiscated. Newly independent Arab countries intervened. But without having constituted armies??, they were quickly defeated. During the war, Israel proceeded to ethnic cleansing and forced at least 700,000 Arabs to flee.

The UN sent a mediator, Count Folke Bernadotte, a Swedish diplomat who saved thousands of Jews during the war. He found that the demographic data provided by the UK authorities were false and demanded the full implementation of the Partition Plan for Palestine. However, Resolution 181 requires the return of 700 000 expelled Arabs, the creation of an Arab state and the internationalization of Jerusalem.

The UN special envoy was murdered, 17 September 1948, on the orders of the future Prime Minister Yitzhak Shamir.

Furious, the General Assembly of the United Nations adopted Resolution 194, which reaffirms the principles of Resolution 181 and, moreover, proclaims the inalienable right of the Palestinians to return to their homes and be compensated for the harm they have just undergone [9].

However, Israel, having arrested Bernadotte’s killers, tried and convicted them, was accepted into the UN on the promise to honor the resolutions. But it was all lies. Immediately thereafter, the killers were pardoned and the shooter became the personal bodyguard of Prime Minister David Ben Gurion.

Since its accession to the UN, Israel has continued to violate the resolutions that have accumulated in the General Assembly and the Security Council. Its organic links with two Board members with the right to veto place it outside of international law. It became an offshore State of the United States and the United Kingdom allowing them to feign respect for international law while violating it from this pseudo-state themselves.

 -    http://www.voltairenet.org/article184973.html

[my_nym]

Exactly.  How can they write an article and not even mention the Tribe Inc.?  

....absent the lobby’s influence, there almost certainly would not have been a war. The lobby was a necessary but not sufficient condition for a war that is a strategic disaster for the United States and a boon for Iran, Israel’s most serious regional adversary. Chapter 9 (“ Taking Aim at Syria”) describes the evolution of America’s difficult relationship with the Assad regime in Syria. We document how the lobby has pushed Washington to adopt confrontational policies toward Syria (including occasional threats of regime change) when doing so was what the Israeli government wanted. The United States and Syria would not be allies if key groups in the lobby were less influential, but the United States would have taken a much less confrontational approach and might even be cooperating with Syria in a number of limited but useful ways. Indeed, absent the lobby, there might already be a peace treaty between Israel and Syria, and Damascus might not be backing Hezbollah in Lebanon, which would be good for both Washington and Jerusalem.

Mearsheimer, John J.; Walt, Stephen M. (2007-09-04). The Israel Lobby and U.S. Foreign Policy (p. 17). Farrar, Straus and Giroux.

OIL = Operation Iraqi Liberation

Right.  That's dumbocrazy in action.  The "no blood for oil" Left lapped that up like like the witless wonders they are while conservatives like the "pet goat" were terrorized with utterly bungled anthrax attacks into doing what Jewish terrorists wanted.  And most refuse to deal with how they were deceived into war to this day. 

Shrug.  Goyim.    

[LawsofPhysics]

"having U.S./Canadian passports or green cards for one's children is unequivocal evidence of membership in the Chinese Elite."  --

How do they think that will work out for them when the native Canadians and Americans are starving?  I suspect they already have a plan in the works, just based on the treatment of their own dissidents.

[youngman]

I dont think we have a 10 or 20 year plan....we only adjust to the current crisis...very short term thinking...its to hard for a politician to think past the next election...

[Bell's 2 hearted]

definitely planning on the fly ... with endgame always the same ... status quo for the elites at the expense of everyone else

[Doubleguns]

Its to hard for a politician to think past the next erection. 

Fixed it for you. 

http://matadornetwork.com/abroad/election-vs-erection-a-series-of-funny-...

[Lithophiliac]

That's why they aren't in charge anymore.

[KnuckleDragger-X]

If your in charge then you have to take responsibility, much easier to play another round of golf....

[Jason T]

has anyone actually noticied the outright collapse in US oil consumption per capita?

[KnuckleDragger-X]

Not in DC, because then they would have to ask why.

[Bangalore Equit...]

Listen.

Consumption never collapses it "DRIES" up.

USSA people are too broke to afford a car. That is the way Oblather wants it. White people riding the bus.

[dbTX]

The entire Obama crew is without a clue. Read um and weep 

[Bell's 2 hearted]

can't we just play global thermonuclear war?

i need to go to lunch in an hour ...

[Dragon HAwk]

Life is a Game ?...  who could have Imagined that ... ?

   /s

[teslaberry]

 (and as I have explained many times, nations with trade surpluses cannot issue reserve currencies

this is a nonsense assumption that is repeated continuously by economists. it's horseshit. 

[Bell's 2 hearted]

Really?

if you're a surplus country you're absorbing other countries currencies ... how the hell then are you going to get "yours" out there? ... especially, in quantities necessary to be considered "reserve"?

[KnuckleDragger-X]

Bingo... that's why the petrodollar was invented.

[Bell's 2 hearted]

Yes!

[Dien Bien Poo]

duh. You DEMAND payment in your currency.

[Bell's 2 hearted]

haha ... how can you demand payment in your currency when it is not out there (in any quantity)?

remember, you are an export/mercantile/surplus country

[Dien Bien Poo]

im assuming one can buy more of it. If i needed Rupiah to buy an import I would buy Rupiah....quantity is irrelevant...thye can print more, as we do.

[Diogenes of Sinope]

British Empire.

Anyways, you're supposed to get all their gold, not their currency.  All your gold, mines, land, oil, labor products, hot chicks....it all belongs to us!!!

That is what Empire is about.

[teslaberry]

you lend them your money  and give them something somweher to spend it on. petrodollar. 

u.s. can have a surplus , it DOES have a surplus when you include global oil supplies denominated in dollars. those are essentially OUR supplies because it's denominated in our currency. 

if that oil were produced in america-----it would technically register as ours. there is no difference (we even send many of our workers to saudi to do the work and pay international tax) 

the only important factor with the money is how it flows. you keep giving the world more of it, to buy more oil. we are a surplus nation. you just didn't get that....

[The Phallic Crusader]

It's hard to take the author seriously when he asserts that neocon strategy is intrinsically incoherent.  Stupid, yes, bloodthirsty, of course - but one need only read a couple of position papers to get the flavor.

http://en.wikipedia.org/wiki/A_Clean_Break:_A_New_Strategy_for_Securing_...

http://mondoweiss.net/2014/06/about-though-israel

http://www.antiwar.com/orig/kwiatkowski.php?articleid=9306

~~

http://www.ifamericansknew.org/us_ints/nc-pilger.html

http://www.informationclearinghouse.info/article3249.htm

And it's not {solely or even primarily} about oil for the neocons. 

Of course, Zbig et al. aren't, strictly speaking, neocons, and it's tough to know just who is calling the shots - there may well be competing factions.  None of them seem to consider making deals and spending $ on alternative energy, space exploration, etc. as being wiser courses.

Of course, americans show no signs of rebelling against their Orwellized Republic - so be always drunken, I guess...

[teslaberry]

of course, it's not americans and the american oligarchs controlling american it's israel. of course!

fuck you anti-semite.

[The Phallic Crusader]

the neocons were/are overwhelmingly zionist jews.  People like you cry "anti-semite" whenever this fact is uttered - but I'm not easily intimidated by such rhetorical ploys. 

As noted, it is not just neocons calling the shots.  Zbig is not a "neocon" but he's still a militarist.

What is "anti-Semitic" about a single point made - guy who, I'm sure, did not bother to read a single thing?

Do you really think people who aren't obtuse or pro-Israel to the point of dishonesty are going to fall for this hackneyed device? 

What's the inverse - that the Israel Lobby and pro-Israel neocons have no power?  Would you ever consider any evidence to the contrary, or are you just the sort of wonderful pro-Israel humanist who only values human life and the bare merit of "facts" in accordance with whether or not it comports with your Israel-centric, Israeli-apologetics?

Of course not.

So, in the end, shouldn't you be the one to continue fucking yourself by continuing to cry "anti-Semite" in the face of brutality, oppression, treachery, warmongering, colonialism, and apartheid?

You bet you should.

[teslaberry]

i just find it amusing that you wash your own hands of responsibility for u.s. own oligarchs and say 'they are all israeli'. 

the bush clan, a bunch of actual natzis, had a huge hand in everything that happenes over the 12 years of their presidency. and somehow-----you lay ALL of the blame on israel. the master manipulators. 

i'm tired of seeing this. i well understand the rotten core of international banksterism. but you lay none of it at the hands of american or british companies. it's all israel. all zionists. 

eventually as things get worse----people like you will call for the destruction of israel. and for the destruction of american jewry. the scapegoating of one single group as the solution to all of your problems. 

it won't solve your problems. the idea that you are fooling yourself into separating your hatred of israel from your hatred of american jewry is legitimate. you will identify all jews as serving the ends of aipac and --aipac as being the major cause of americas problems. 

i have news for you without aipac  american oligarchs would continue their wars in the middle east. haliburton is owned by people with no interests in israel except using it to obtain saudi arabias consent. 

the relentless anti-israel trashing has one goal---to demonize israel and american jews. your rhetorical ratchet does not try and distinguish between being anti-war and anti-israel. 

you equate the two policies as being one. they are not. you almost certainly blame israel, rather than american operators such as george bush and the saudis-----for the 9/11 event. 

[my_nym]

Who are "the oligarchs" that you want to blame?  If they're dual citizens then what?

In any event...  it would seem that AMERICANS don't have a lobby in Israel pursuing their interests or dual citizens there representing them in the Israeli government, huh?

[The Fourth]

Two cents added:

Halford MacKinder

The Geographical Pivot of History -1904

Essentially, either control the "pivot area"…, or be controlled by the "hordes".

You might could sum up the macro geopolitical CFR strategy with the lurching toward 'Middle Earth'.

Same as it ever was…

source:

http://intersci.ss.uci.edu/wiki/eBooks/Articles/1904%20HEARTLAND%20THEOR...

[Diogenes of Sinope]

Mackinder was a Fabian.

We are witnessing the Fabian play for control of the entire world...the world socialism dreamed of by the Permanent Revolution...

Aren't we lucky.

[astoriajoe]

"Which nation's Power Elites have made sure their children have green cards and homes in the others' home turf?"

perhaps, but at some level of elite, they probably have homes stashed in multiple locations. These elites become less aligned to a particular country and more  to whatever country allows them to remain elites. Paraguay comes to mind.

oh well, we'll probably see soon enough.

Long rocket mass heaters.

[Winston Churchill]

No insights.

I don't think Russia or China want GRC status.Nor does the RoW.

What they ALL want is the dollar dethroned.

[Bell's 2 hearted]

i think more Love/Hate

bottom line ... SOMEONE needs to buy their factories output ... or else their displaced workers looking to put heads on spikes

[LawsofPhysics]

So people around the world would have to figure out how to settle their trade accounts on a case-by-case basis with each trade partner?

Free markets?  Oh the horror.....

Fucking bring it.

[Bell's 2 hearted]

how the hell are 2 piss ant countries supposed to conduct trade?

Can you imagine the hedging necessary between 2 fly by night currencies (lets say for a bushel of corn from NEXT year's crop)?

Much better to price in some (relatively) stable currency

[LawsofPhysics]

sure, the fucking point is that trade is the only thing that keeps a world war at bay.

[besnook]

gold account.

[sleigher]

They don't want the dollar dethroned so they too can have the power of a reserve currency?  Certainly there are oligarch types in those countries salivating at the idea.  no?

I don't know nor do I pretend to know.  Killing the dollar and watching America die is fun and all, but certainly their aim is higher.  At least I would think so.

[Winston Churchill]

There are wants, and there are needs.

[blabam]

Doesn't Bush have a hideout in Paraguay? They probably all have cribs in other countries.

[Dien Bien Poo]

Yes he probably does so he can spend time with his Nazi friends, Dr Mengele et al.. That Motherfucker should be in jail. 

[sandhillexit]

Ken Lay, head of the fund-raising arm of the election campaign, now splits his time between Paraguay and Aspen, I've heard.  That way its always summer.

[The Phallic Crusader]

Neocons’ Noses Into the Syrian Tent

[Ghordius]

"Glancing at this map, it follows that the energy stranglehold Russia currently enjoys on Europe is not permanent"

of course it's not permanent. it's actually not even a stranglehold. shutting down Europe would be the equivalent of shutting down China, i.e. shutting down the workshops

the US and Russia are in the Great (Energy) Game. but without Energy Consumer For Production, the very Great Game shuts down

further, if you starve the producers, they Get Ideas. Like the French "Plenty of Nuclear Plants". Or the German "Energie-Wende", or whatever. Very Dangerous

to come back to Russia, it can't even afford not to sell and get something back for it. see the whole Ukraine mess in this light, and tell me if you don't see the pattern

[The Phallic Crusader]

Ummm...  what?

[angel_of_joy]

EU delusions run deep, however they are still delusions... Your beloved "union" is only as strong as its weakest link. And right now, there are way more weak links than strong ones in that rusted chain of yours...

[jarana]

Spain buys 0% gas from Russia. Spain uses LNG deposits and terminals for taking shipped gas from Africa and Latin America (I'm not sure about the last one).

MIDCAT project is in standby by now, but in the near future it could be a great move that will benefit some spanish and french enterprises (and governments).

China has shown interest in what they call "the Mediterranean corridor" (kind of new silk road from west-to-east and south-to-north). Maybe one day China will be considered by Spain, Italy, Greece... (and maybe France) a better bussines partner for this project than USA and north(core)-EU. I think that this would be a serious turning point...

[petkovplamen]

Severa of the writer's assumptions are flat out wrong. For example:

 " The currency that will be needed for reserves and to service debts is the U.S. dollar. As demand for USD rises and U.S.   imports (i.e. the supply of USD being exported) decline, the value of USD will rise sharply."

Not necessarily. A lot of countries and economies are moving away from USD. Europe and China JUST yesterday started trading without the dollr, coinidently Hong kong riitos started. China has began trading wihtout the dollr with Australian, new Zeland, Europe, Germany and Russia. Thats 50% of the world. The BRICs will begin trading in 2015.

The writer makes sure to describe CHina's faults in detail but somehow omits  describing ANY of USA's faults thus implying USA is in better finacial economic shape than China. Thats just dishonest "reporting", simply spinning. USA has many faults and economic problems, strating with uits overuse of military and spending trillions on military.USA is fading as economic power and it knows it. No wodner it is eager to stat a war with Russia.

Overal barely ok article, about 10% truth.

[viator]

The very use of the word oil is obsolete. The germane word is hydrocarbons, which with some work are mostly interchangeable. One such hydrocarbon, untouched as yet, is methane hydrates. The sedimentary methane hydrate reservoir probably contains at least 2–10 times the currently known reserves of conventional natural gas, as of 2013.

[LawsofPhysics]

"reduced hydrocarbons"  -  fixed it for you.

[Livermore Legend]

.

[The Phallic Crusader]

and the German word is Kohlenwasserstoffe!

[OC Money Man]

This is a brilliantly written article, but the "earth" under the Obama policy of advocating world liberation moved against him.   

The United States became the world’s largest natural gas producer in 2010 and is streaking past Saudi Arabia to become the world’s largest producer of petroleum liquids, according to the International Energy Agency.  Despite common analyst belief that a “peak oil” event took place in the 1990s and global production was in terminal decline, the U.S. in the last three years has experienced the fastest growth in oil and gas production in the history of the planet. 

The United States surpassed all other countries this year with daily crude oil and other petroleum liquids reaching 11 million barrels per day (mbd).  Since the beginning of 2011, U.S. liquid fuels grew by more than 4 mbd, including 3 mbd of crude oil.  The growth of U.S. production has been the “main factor counterbalancing the supply disruptions on the global oil market” and “has contributed to a decrease in crude oil price volatility since 2011”, according to the U.S. Energy Information Agency (EIA).

Most analysts assumed July 2008’s production of 81.73 mbd as the world oil production peak, including crude oil, lease condensate, oil sands and natural gas plant liquids.  If natural gas plant liquids and oil sands were excluded, analysts would have deemed 2005 to be the peak at 72.75 mbd.

But world oil production continued to rise to a record 92.6 mbd in June of 2014 and demand now exceeds supply by over 1 mbd.   Half of that increase in oil production came from the United States and Canada development of “tight oil” from hydraulic fracturing of shale deposits and mining of oil sands deposits. 

U.S. production of oil could have been another 1.5 mbd higher, but booming U.S. oil and natural gas production overwhelmed the nation’s pipeline and rail-tanker infrastructure.  Over-supply has caused a decline in gas drilling and has led to a supply glut of oil.  The spot prices for West Texas Intermediate crude at the Midland, Texas hub now sells for an $8 discount to the price at the Cushing, Oklahoma hub; which is selling at a $9 discount to the “Brent crude” international price.   

Cheap energy is beginning to drive a boom in metals-based manufacturers.  The EIA's Annual Energy Outlook 2014 projects that “shipments for metals-based industries will increase substantially from 2012 to 2040 due to the increased availability and lower cost of natural gas.”  EIA expects growing international competitiveness of the U.S. based metal industries will spur innovations that will “contribute to growth, particularly in the computers and electronic products and transportation equipment industries.”

Oil drilling was pioneered in the United States in 1859 when "Colonel" Edwin Drake drilled down 57 feet at Oil Creek Pennsylvania to find “rock oil” in commercial quantities.  America remained the world’s largest oil producer from 1870 to 1970, before being passed by the Middle East in the 1970s and Saudi Arabia in 1991.  During that period, American domestic oil at a third of world costs drove U.S. manufacturing dominance. 

Oil production was also the deciding factors in America’s victories in both World Wars in the 20^th Century, where oil was 50% of all European shipments.  According to U.S. Commanding General Omar Bradley, “Amateurs study tactics, professionals Study logistics.” 

Once the U.S. lost its “comparative advantage” in energy costs, about half of American manufacturing jobs were lost as U.S. companies went off-shore to stay competitive with cheap labor.  

[Duffy]

For Mexican geopolitical expert, Alfredo Jalife-Rahme, the simultaneity of the events illuminates their meaning: soon after announcing the creation of an alternative to the International Monetary Fund and the World Bank, that is to say the dollar, Russia is having to face at the same time the accusation of having downed the Malaysia Airlines jet, the Israeli attack on Gaza backed by US and UK military intelligence, the chaos in Libya and the Islamic State offensive in the Levant. In addition, in each of these war theaters, the fighting revolves around the control of hydrocarbons, which until now were traded exclusively in dollars.

 - What do wars in Ukraine, Gaza, Syria and Libya have in common ?

[Seize Mars]

This is an article about an article, not an article.
In other words, I know this stuff, I need insights.

[limacon]

The Great Game at present is more like mud wrestling at Club Copacabana .

See http://andreswhy.blogspot.com/2011/09/peak-car.html

Then there are the dreaded Dragon Kings that overturns all order and start a new Game .

See http://andreswhy.blogspot.com/2013/11/dragon-kings.html

[My Days Are Get...]

I can only ask myself,

Charles, who paid you to write this article

what is its purpose

why is it being published now

Propagranda?

[besnook]

.gov is so used to lying they don't know the value of the truth.

if the usa had simply informed the usa people that it was important to the american way of life to secure oil supply(even though there was no real existential threat) from the mid east i bet the bottom half of the class would have rallied around the flag and their kids would have enlisted en masse. unsure of their ability to sell the truth .gov decided upon using the time honored false flag followed by a propaganda onslaught that only the stupidest people(american people) could have bought. this strategy exposed the real agenda which was driven by israel and their avowed right to eretz israel extending to the euphrates river(and now all the way to pakistan). this is not neccessarily bad either if israel was a trustworthy partner. they could have been the local enforcer earning their 3bil dollar annual gift(plus billions more in proxy gifts) instead of being the parasite it is.

without the admission of benefit to israel the foreign policy and daily tactical maneuvers make the mid east strategy look dumb but if it was ever admitted the policy was meant to benefit israel only, there is a danger the bottom half of the class might get a clue and throw israel out. if israel loses the support of the usa people israel is done. that is what drives mid east policy.

[gcjohns1971]

Great article on 'The Great Game'.  Absolutely an energy war.

The more vigorously it has been denied the more certain I have become.  Libya, Syria, Georgia, and Ukraine are all about European energy access.  Russia stands to lose.  Europe (the countries therein rather than the EU as an organization) stands to gain.   The US seeks to have significant control over European-Accessible non-Russian energy.  The Middle Eastern Energy Barons seek to send their crazies away from home, while providing for some kind of powerbase if/when their energy economies crash.

Perfectly reasonable analysis of underlying dynamics.

Some of the conclusions, while very conventional, are highly questionable.

For instance this statement:

"The currency that will be needed for reserves and to service debts is the U.S. dollar."

This is absolutely the conventional wisdom.  And for most of the past 70 years this has been unquestionably true.  However, for well publicized reasons, there are many black swans lurking in the shadows of the Dollar that could undo this in an instant.  Their presence makes Smith's affirmative statement into a highly speculative one.

What will be required for reserves and to service debts is a highly liquid instrument of established and stable value.  There are other instruments better fitting that description than the Dollar - notably precious metals, especially Silver and Gold, which lack all the Dollar's lurking black swans. 

Smith would be absolutely correct in pointing out that Central Banks around the world are not structured to trade Gold in this way.  But the fact is that they were structured so within the limits of living memory, and I suspect necessity would revitalize those old, unused methods with AMAZING rapidity.

With regard to Smiths assertions on China... Well, what about Jim Rogers? What about Marc Farber?   Smith's points are good ones.   But they work both ways.  I think the outcome is highly uncertain.   However, Asia has a very powerful disincentive for global dominance - the lack of energy abundance.  But who knows?  It is uncertain, as I said.

However, I do not think that China can issue the reserve currency.  If they have gold, they could compete for reserve currency.  The lack of energy drain away their gold over time - especially with its value bolstered by remoneitization. So...I doubt it.  

And Russia? Could Russia issue the reserve currency? Hard to say 100% for certain.  But I sincerely doubt it.  

While Russian people are genteel and refined, and while they have talented engineers, and have the requisite energy to ensure their earnings are not leached away as a result of currency export, their governments over the last 1000 years  have been uniformly given to coarse behavior to the point of banditry.  I am speaking of Crimea - but not of the 21st or 20th Centuries.  I am speaking of the 18th Century. 

But the examples of Russian neighbors whose identity has been denied, followed by invasion and annexation is just about universal.  Everyone sharing a land border with Russia has been invaded and annexed at one point or another, and most of them within the living memory of the eldest citizens.  Russia has its justifications for all of these...but such justifications are written by the winner.  And the populations of such places universally do not agree...and that forms a lack of trust.

Trust is also an essential ingredient for a reserve currency.  

That's not compatible with reserve currency status because it strikes at expectations of the value of the reserve.  My intent is not to offend Genteel Russian people, but to point out that the rest of the planet will never trust a Russian government or its currency.  It is a signal that the Russian Government's closest allies are those with whom it shares no land border.

What about the radical idea of just making an element of the periodic table the Reservce currency, with the Central Bank issuing it known as 'Earth, 3d Planet'???  In the modern age, with modern technology, do we really need there to be a Mint, and a government to ensure that hard currency is what it purports to be?

[BlackVoid]

"The more vigorously it has been denied the more certain I have become.  Libya, Syria, Georgia, and Ukraine are all about European energy access.  Russia stands to lose.  Europe (the countries therein rather than the EU as an organization) stands to gain.  "

Well, so far the only results are supply disruptions in transportation. Hardly a gain for the EU. Do you see a stable Syria acting as transit in the next decades? There is no country in the last 30 years that gained stability from US meddling.

The EU stands to lose a lot in this and that may be by design (made in the USA). Russia is turning east, if EU does not want gas, they can freeze in the dark.

There is no capacity to replace Russian gas from anywhere else, except maybe from Iran.

[BlackVoid]

"However, Asia has a very powerful disincentive for global dominance - the lack of energy abundance."

US has the same problem.

Controlling the Middle East works wonders in this regard.

[BlackVoid]

A reserve currency must be backed by energy.

In the case of USD it is oil. In the case of gold it is stored labor / energy. Russia can back it's currency with gas. Or even with other hard assets like platinum, gold, etc (stores of energy in a way).

A trade deficit is not required, at least not at first.

[sudzee]

Nest gen. energy. Gold nanoparticles producing hydrogen from water:

http://fuelcellsworks.com/news/2014/09/16/korean-research-team-develops-tech-to-mass-produce-hydrogen/

[BlackVoid]

It is not an energy source, it only allows conversion of one energy form to another.

Sunlight cannot propell a car even if all the energy is utilized. It is a nice proof of concept and a nice PR article, but has close to zero practical use.

Sorry.

[BlackVoid]

It is the US that has an overstretched and costly empire. Clearly in decline.

Dollar acceptance is in long-term decline, that can accelerate very quickly.

I bet just before the collapse of Rome, neighboring rich people were still striving for roman citizenship. Moving to the US now is a very stupid move.

US has a huge problem with the draught. If agri exports vanish, they will not have anything to sell that has value on the world market except weapons.

China will not become a global hegemon US style. It is even a question if it wants to.

Global resource contsraints are an increasing problem. Ebola is a wildcard. There are other potential unexpected big events too.

[theyjustcantstop]

i'd say americas foriegn policy was advocated in 1913, (the federal reserve act) to a few unelected, (mostly non-american citizens), richest people in the world, owners of the BIS, a PRIVATLY held bank that employs the FED..

when americas duely elected representatives advocated their duties to uphold the constitution, and find a constitutional remedy to the monetary diffucuties america found itself in, then handed americas financial security to a privately held bank, mostly owned by europeans was the begining of the end.

these bankers were already expert in insider news

 in making money, and they knew through regional, and especially world wars, is where the big money is made, and when you getting cash under the table, and the vig. from at least 6 different countries during world wars, how many people die, and countries destroyed is just part of making money.

russia would be glad to take over americas national security for less than a trillion a year.