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Halliburton's secret deal for Iraq's oil

Every time such an infrastructure story appears I again wonder why Halliburton put its Global Infrastructure Headquarters into Adelaide. There's little doubt now that the details of Iraq invasion oilfied activities would have been sliding over desks on Greenhill Road long before Australian troops set foot on Iraqi soil.

One of my heroes, Jason Leopold, is a former Los Angeles bureau chief of Dow Jones Newswires. He has worked for the Los Angeles Times and has been a frequent guest on CNBC; his articles have appeared in The Nation, The Wall Street Journal, and The Financial Times. His book News Junkie made the Los Angeles Times bestseller list. This piece, first published on The Public Record over the weekend, is reprinted on Webdiary with Jason's permission.


Halliburton's secret deal for Iraq's Oil

by Jason Leopold

Four months before the United States invaded Iraq, the Department of Defense was secretly working with Vice Pesident Dick Cheney's old company, Halliburton Corp. on a secret deal that would give the world's second largest oil services company total control over Iraq's oil fields, according to interviews with Halliburton's most senior executives.

Previously undisclosed Halliburton documents obtained by The Public Record confirm that controlling the world's second largest oil reserves was a top priority for the Bush administration. Additionally, the deal between the Department of Defense and Halliburton unit Kellogg, Brown & Root to operate Iraq's oil industry saved Halliburton from imminent bankruptcy.

In October of 2002, Halliburton was saddled with a multibillion-dollar asbestos liability as well as a serious slowdown in domestic oil production. The company’s stock plummeted on the news falling to a low of $12.62 in October 2002 from a high of $22 the year before.

A month later, in November 2002, Halliburton’s financial troubles seemingly disappeared. At the urging of unnamed officials in the Office of the Vice President, according to the documents, the Department of Defense recommended The Army Corps of Engineers award a contract to Kellogg, Brown & Root to extinguish Iraqi oil well fires in addition to "assessing the condition of oil-related infrastructure; cleaning up oil spills or other environmental damage at oil facilities; engineering design and repair or reconstruction of damaged infrastructure; assisting in making facilities operational; distribution of petroleum products; and assisting the Iraqis in resuming Iraqi oil company operations."

That was a deal hatched five months before the start of the Iraq war, when the Bush administration said publicly that it had not been working on war plans.

"The fact that the Department was planning for the possibility that it would need to repair and provide for continuity of operations of the Iraqi oil infrastructure was classified until March 2003," the Army Corps of Engineers said on its web site. "This prevented earlier acknowledgement or announcement of potential requirements to the business community."

Halliburton spun off KBR into a separate company last year. The Army Corps of Engineers has declassified portions of some documents related to its deal with Kellogg, Brown & Root.

"The U.S. considered such contingency planning necessary because of Saddam Hussein's actions in Kuwait in 1991, when Iraqi forces damaged 750 wells," states documents released by the Army Corps of Engineers. "That destruction resulted in an environmental disaster as well as a tremendous blow to Kuwait's oil production capability. The U.S. had grounds to believe Saddam was planning to destroy Iraq's own oil infrastructure in the event of hostilities. Such destruction, especially if it extended beyond oil wells to pipelines, pumping stations, or other elements of the infrastructure, could have drastically reduced the Iraqi oil industry's capability to produce income on which the Iraqi people depend. Destruction of the oil fields would result in potential loss of $20 to $30 billion a year in oil revenues for Iraq, as well as an estimated cost of between $30 and $40 billion to recreate the infrastructure.

When news of the deal surfaced five years ago, the Army Corps of Engineers was criticized by Washington lawmakers for awarding the no-bid contract to Brown & Root because of the company's strong ties to Cheney. The Army Corps of Engineers told lawmakers that Kellogg, Brown & Root would do nothing more than extinguish oil well fires. Brown & Root was chosen, according to the Army Corps of Engineers, because the company could be "deployed" on short notice.

However, according to a report in the magazine Fortune, Halliburton employees were working out of a hotel room in Kuwait City as far back as November 2002 assessing Iraq's oil infrastructure and mapping out plans for operating Iraq's oil industry.

"From behind the obsidian mirrors of his wraparound sunglasses, Ray Rodon surveys the vast desert landscape of southern Iraq's Rumailah oilfield. A project manager with Halliburton's engineering and construction division, Kellogg Brown & Root, Rodon has spent months preparing for the daunting task of repairing Iraq's oil industry. Working first at headquarters in Houston and then out of a hotel room in Kuwait City, he has studied the intricacies of the Iraqi national oil company, even reviewing the firm's organizational charts so that Halliburton and the Army can ascertain which Iraqis are reliable technocrats and which are Saddam loyalists," states the April 2003 report published in Fortune.

"Rodon represents the vanguard of what is expected to be a growing army of Halliburton employees in Iraq, where the U.S. is preparing to embark on the grandest exercise in nation building since its occupation of Japan after World War II. At the center of that undertaking will be U.S. companies, with Halliburton probably chief among them," Fortune reported. "Indeed, Texans wearing KBR baseball caps are arriving by the planeload at Kuwait's airport. Some will support the military directly--KBR employees already handle the meal service, laundry, and garbage pickup for several military camps in Kuwait and will do the same as U.S. units establish bases in Iraq. But after the war most hope to be involved in the multibillion-dollar task of rebuilding Iraq: its roads, electrical grid, water supply, ports, airports, and, most important, oil facilities.

"The liberation of Iraq couldn't come at a better time for Halliburton, whose business has been dogged by a host of troubles--from a slowdown in domestic oil production to nightmare asbestos litigation. Last year revenues declined 6%, to $12.6 billion, and the company reported a net loss of $984 million. But CEO Dave Lesar, who took over when his predecessor Dick Cheney went to Washington, is starting to put Halliburton's problems behind it. He has cut costs, sold unproductive assets, curtailed money-losing overseas operations, and devised a bold plan to settle asbestos-related lawsuits."

In a March 2003 news release, Halliburton said it first began working on a plan to repair Iraq's oil infrastructure at the request of the Defense Department.

"The DoD, through its US Army Logistics Civil Augmentation Program (LOGCAP) III contract with KBR, tapped the company in November 2002 to develop the contingency plan. Implementation of the plan is being executed through a separate contract [Kellogg, Brown & Root] now holds with the US Army Corps of Engineers," the news release says.

Perhaps what has been troubling about the lucrative contracts Halliburton has been awarded is the company’s history of overcharging the federal government by millions of dollars. On at least one occasion, overbilling took place while Cheney was chief executive of the company.

In 2002, KBR agreed to pay the U.S. government $2 million to settle allegations it defrauded the military during Cheney’s tenure. KBR was accused of inflating contract prices for maintenance and repairs at Fort Ord, a now-shuttered military installation near Monterey, Calif. The lawsuit, filed in Sacramento, alleged KBR submitted false claims and made false statements in connection with 224 delivery orders between April 1994 and September 1998. KBR and Halliburton has also paid out settlements to end investigations and lawsuits on half-a-dozen other occasions.

So how does the company continue to win such lucrative contracts with the federal government in spite of its shady record?

"KBR was selected for the [Iraq contract] based on the fact that KBR is the only contractor that could commence implementing the complex contingency plan on extremely short notice," Halliburton said in a March news release.

Army Corps of Engineers spokeswoman Carol Sanders said Iraqi people urgently needed cooking oil and gasoline as they began rebuilding their country. Given the need to boil water to prevent disease, it was not feasible to competitively bid the work. She rejected claims that Cheney’s role as Halliburton’s former chief executive in the 1990s had an impact on the contract.

"We made the contract broad enough so we could handle issues just like this," she said.

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More on Iraq/US oil

I forgot to mention in my previous post that the US uses about 25% of the world's total oil production and imports about 31% of the total net exports on the world market. The fact that it uses 32% of Iraq's oil exports (almost exactly proportional to that figure) is hardly consistent with the story that it "invaded Iraq for its oil".


Interesting reading about the percentage. I didn't want to quote the percentage myself as I suspected we'd end up with a silly debate of cite a percentage and counter-cite another.

The point generally being that the percentage of US oil needs imported from the Middle East is lower than most people expect. It is worth considering even in the context of the current election campaign in the US. Energy independence is an often discussed topic.

Further drilling in Alaska or off the coast of Florida are cases in point. Florida was certainly off the agenda (at least in my view) until the last year or so. In Australia we have seen how petrol prices and grocery prices become a political issue. It is no different in the US. Both parties use the issue to advance their cause and that's how drilling off the coast of Florida comes back onto the table.

Tricky one though since while Florida may be a source of oil that would be popular in other states (and contribute to energy independence), Florida is a swing state and brings a nice chunk of Electoral College votes to the presidency. Having lived in Florida myself, I'm not sure the sight of oil rigs off the coast would go down particularly well.

Personally, I am a huge fan of high oil prices. It speeds up the conversion to alternative technology. High oil prices are great. Bring 'em on I say.

All the red herrings aside, it is still notable that the US imports far less oil from the Middle East than most people expect.

Those Australian figures supplied by Stuart are quite interesting too. I like the Vietnam thing. Not many would realise that. That makes sense to me but New Zealand? That's rather intriguing! Sheep oil? It's even hard to imagine NZ as a trans-shipment point. Quite weird. New Zealand - the budding energy superpower! Joke City.

Talk About Missing The Bleeding Obvious! Sheesh!

Where the US gets its oil from today is misleading.

Iraq contains the second largest proven oil reserve. The US will take its oil from anyone who will sell to them at the moment. In fact the more sources for oil that the US has today stands it in good stead for later when the big arm-wrestle with China starts in earnest.

Iraqi oil is America's insurance. It controls Iraq and will use that oil only when it has to.

Some facts about Iraqi oil etc

Roger, you're right in suggesting that where the US gets its oil from today might be misleading, but your conclusion is wrong. 

The US receives about 32% of Iraq's exported oil. About 25% goes to Europe and 38% to Asia.

Regarding your comment about Iraq's reserves, the most important factor with oil is not the size of the reserve but the rate of production. Iraq currently produces approximately 2 million barrels of crude oil a day, or 2.7 % of the world total of 74 million barrels/day. Bringing Iraqi production back to that level after the war cost at least US$5 billion from the US alone. Increasing it substantially beyond that will cost at least several times that figure, mainly because of decades of neglect with the energy infrastructure. There are many wild claims about Iraq's ultimate production capacity, but 4 million barrels/day is optimistic in my view. With world oil production likely to decline at a rate of 2-3% per annum beginning sometime between now and 2015, the optimistic increase in Iraqi oil production would offset maybe one year of declining world production.

When this occurs the world's oil importers, including the US, are basically screwed regardless of where the oil is coming from because the OECD relies on market mechanisms to sort out the problem, ie rationing by price. OPEC, Russia (which most people don't know produces almost as much oil as Saudi Arabia) and the other major oil exporters have the western world by the balls. If you think US$100 oil is tough, just wait until you see US$200 or US$300 oil, mysterious oil & gas pipeline shutdowns between eastern and western Europe and a renewed confrontation between Russia and NATO.

Even from a narrow US perspective, several of the countries from which the US currently imports its oil are past peak and rapidly declining (eg Mexico). Many of those upon which they are relying on for increasing imports in future are politically hostile (Venezuela), politically unstable and/or very remote. We are only in the early stages of a massive geopolitical shake-up.

The other point to bear in mind is that Iraq's oil export revenues are extremely important for the country to get back on its feet.

Sure, a lot of US oil men will make a lot of money from the Iraqi oil business in some highly questionable dealings, but your claims about US control over Iraqi oil are a bit of a stretch to put it politely. The Carter doctrine was openly declared three decades ago; it's not part of some recent Bush-Halliburton conspiracy. The US is governed by free-market zealots who honestly believe that keeping oil flowing onto the open market via secure supply lines is the full extent of the so-called 'energy security' problem.

The real tragedy is that their ideological rejection of any limits to growth, coupled with their massive oil import dependence, that will bring them (and us) unstuck. This is not a sin of comission but of omission, ie the US, Australia and the rest of the OECD oil importers have not even acknowledged peak oil much less put plans in place. Time spent obsessing about the 'war for oil' would be much better spent figuring out how we're going to get around the place and feed ourselves when petrol reaches $5 a litre, in my humble opinion.


Stuart, I agree with some of your analysis and would like to point out some differences in my thinking.

In my opinion, the US is controlled by zealots (and I don't mean the neo-cons) who have no interest in a "free market". That is merely a euphemism for America's selfish interest. The US version of a free market is where the US gets a free go at everything and everybody else gets screwed.

The latest Administration is continuing the tradition of manifesting what the US believes to be its birthright. 

As to the control of Iraq, who exactly does control it? Not the stupid Iraqis who insist on killing each other over religious bigotry or tribal jockeying. Not the government which is riddled with corruption and is in the pay of the US.

The most stable of the Iraqi institutions is the Oil Ministry. All necessary contracts have been signed and will be honoured while the rest of the country remains in turmoil.

Peak oil has already been factored into the equation. It is the reason why the US is there, as Greenspan has acknowledged.

There will be life after oil is gone but in the words of Mr Spock "not as we know it".  

The world cannot support 6 billion+. Nature has its own way of dealing with an animal species that over-runs its environment. There will be war, famine and disease on a scale we have not witnessed before and billions will die. Africa will bear the brunt of a massive population decimation and will be taken over by the victors of WWIII. Australia will cease to exist as a white enclave. It will be taken over by the Chinese.

The US and other leaders know this.

Nobody controls Iraq

Nobody controls Iraq, Roger. At best there are some people who control some of Iraq.

Re Greenspan, I am aware that he has made some comments re oil as a motivation for the Iraq invasion (I agree: it was a motivation), but to my knowledge he has not acknowledged peak oil, much less claimed that peak oil was the motivation for in vading Iraq. He has definitely not claimed that the invasion was motivated by peak oil. You have made two leaps in logic.

Very energetic

Stuart, leaping to conclusions is what we are all doing here.

We have no true insider information and can only try to fit an explanation to the observed events.

However, I am old enough at 63 to see history repeating itself in my life time. I am the product of the Nazi era, being conceived and born in a slave labour camp. I have assiduously studied the pre-WWII era and the war itself. The most outlandish claim that could have been made at the time was that Hitler would not shy from world war and genocide. Yet he had clearly laid out his plans in Mein Kampf.

The simple and best explanation in assessing any world events is to acknowledge that what countries do is based on the most mean-spirited and brutal reasons that can be imagined.

The US is not the saviour of the "free" world. Its people have many wonderful attributes, which I can attest to having lived there for 8 years. However, the people do not make the decisions, its leaders do and they make their decisions in terms that most of us would shy away from.

Real politik is unknown to the ordinary population yet it is how the world experiences the effects of nationalistic actions. Our Pacific neighbours know first hand how Australia can and does throw its weight around in our region. That exercise in raw power, however, has little effect on us, unless you want to confront government power as a few WD contributors have done.

I have proposed a credible real politik explanation for why the US is in Iraq and effectively controls Iraq.

Richard:  Roger, are you feeling up to getting us back up to speed with a piece?

It's China who is more dependent on Middle East oil

David Davis: "What percentage of US oil needs are currently sourced from the Middle East?"

Good point.

Twenty-two percent of U.S. crude imports came from Africa in 2006; this compares with only 15 percent in 2004 and slightly exceeded U.S. imports from the Middle East.  U.S. oil imports from Africa have nearly doubled since 2002.

And this:

Earlier this year (2007), a significant fact went largely unnoticed in the media: Crude oil imports from sub-Saharan Africa (excluding the Arab North African producers of Algeria and Libya) to the United States surpassed those from the Middle East. According to data from the U.S. Energy Information Administration (EIA), the United States imported 1.736 million barrels per day (b/d) from Sub-Saharan Africa in February 2007 -- the bulk from Nigeria and Angola but also from Chad, Congo (Brazzaville), Equatorial Guinea and Gabon.

This amount was slightly greater than imports from the Middle East -- Saudi Arabia, Iraq, Kuwait, and a small amount from Yemen -- which totaled 1.708 million b/d. In March 2007, the United States imported 2.194 million b/d from sub-Saharan Africa compared to 2.095 million b/d from the Middle East.

It's China who is more dependent on Middle East oil.

Now, according to the logic operating here, a Zionist state should be set up somewhere around Nigeria soon, and Obama will invade Angola.

Angola and Venezuela - you can see why Cuba's so fascinated by those places, can't you?

What percentage?

What percentage of US oil needs are currently sourced from the Middle East?  Go ahead, little Googlers, and find out.

Does this sound right, David?

Only time for a  quidk skim over the md-morning cuppa, David, but if I'm reading stuff like this correctly, US  imports 50% of its oil, and ME accounts for 20% of that.  Thus, one tenth of total US consumption from OPEC.  Not as much as I'd have assumed.

US oil import data

Richard et al, authoritative date for US oil imports is here. The US imports about 70% of its oil, at a cost of about US$700 billion per annum (T. Boone Pickens has called this the "biggest transfer of wealth in history"). About 18% of US imports come from the Persian Gulf and about 45% from OPEC (remember OPEC isn't just Middle Eastern countries but includes several African and Sth American countries).

Here are a few facts that might surprise you. Australia's domestic oil production peaked in 2000 and has been declining since, even though our consumption is increasing.  Our net imports are currently almost 50% of our demand (the current petroleum trade deficit is more than $10 billion per annum) and by 2015 will reach about 75% based on official forecasts.  About 1/3 of our oil comes from the Middle East, which means that we are much more dependent on Middle East oil than the US. Australia is unique in the OECD for not having a strategic petroleum reserve. And people think US energy policy is stupid! 

A question, Stuart

Thanks for clarifying that. Do you have the stats on the rest of Australian oil imports?

Yours ever-increasing cynically.

Australian oil imports

Richard, this is the breakdown of Australian crude oil imports as of late last year:

- Vietnam 28%

- PNG 14%

- UAE 13%

- Malaysia 11%

- Brunei 8%

- NZ 7%

- Indonesia 6%

- Saudi Arabia 4%

- Singapore 4%

- Thailand 3%

- Phillipines 2%

The figure of 1/3 reported by Graeme Bethune per my previous post includes the oil used in our imported refined fuels, mainly from Singapore. I can't give you a detailed breakdown of this but I do know Bethune's data is good. Those who claim we only have a minimal dependence on ME oil are being disingenuous by only including crude oil imported to our refineries and excluding imported refined fuel. Perhaps they think Singapore is sitting on the largest oil reserves in the world!

The big problem for oil importing countries (like Australia) is that world net oil exports are already declining. Howard government policy in the face of this was to "let the market sort it [us] out". The Rudd government's response in its 10 months in office has been to remove the Howard government policy from the website and ... wait for it ... conduct another review.


"So, Obama's lying?"

He sure is Eliot - but you already know that.

Yep from me too

The're all lying. We have come to expect this from politicians.

The question should be: Why do we continue to accept this?

So, Obama's lying?

Roger Fedyk: "Anyone who thinks that the US will be out of Iraq in 2011 is deluded.."

So, Obama's lying?

Of course

Eliot, just as Justin and Kathy have said, it is so.

In ealier times, when the invasion happened, I made the claim that the invasion of Iraq was the most significant development in the US-Sino war for world dominance.

No US administration could allow American pre-eminence to be challenged. The true power in the US, the multi-national oligarchs and old money, dictate the main thrust of all US foreign policy, irrespective of party. Their aim is simple and for the past century, unstoppable world domination.

The Chinese will, however, eventually wrest away US dominance. We are watching the frantic end-times of American power.

As for Obama, he's not the President yet but if he does become so, he will continue to further US hegemony.

Eliot, get real!

Anyone who thinks that the US will be out of Iraq in 2011 is deluded. The majority of the troops may have left but only because they are no longer needed to continue the rape of that country.

 All the necessary structures, commercial, legal, criminal and political, are being put into place that will allow the US to control that country through its proxies and henchmen. The changing of the political guard in Washington will not make one iota of difference.

The US will get completely out of Iraq when no oil is left. 50 years is my reckoning. After that the Arabs will be given free rein over the worthless sands. Unless of course, the world powers discover something else there that they need.


It seems more than unfortunate that Reagan is given total  credit for the demise of the USSR, which downplays the effect of the draining of its resources by the war in Afghanistan.   There was a lesson that  otherwise we may have learned there.

McCain won't do it again

Halliburton's position can only be as strong in Iraq as is the US position.

Under Obama or McCain the results will be much the same, though it will probably be a more dragged out affair if McCain is President; but either will face increasing political and economic pressures to get out. The Iranian state is clearly going to be the real winner in Iraq.

Just where does Iran stand? According to Patrick Cockburn:

This is the most misunderstood element in the Iraq crisis. The present Iraqi  government had two main allies: The US and Iran. Their dispute is over  who should have influence over that government. Iran has played a crucial  role in the success of the so-called Surge. The Iraqi army fought poorly  against the militiamen of the Mehdi Army in March and April. It was Iran  that mediated a ceasefire on the Baghdad government’s terms. It was  Iran which pressured the Mehdi Army leader Muqtada al-Sadr to call his  men off the streets. A prime reason why Iraq is not going to disintegrate is  that Iran does not want it to.

So the departure of US troops from Iraq will not mean a renewed civil war?

No. The main civil war is over. The Shia won and the Sunni lost. But the  Sunni minority in Baghdad look vulnerable without American protection.  The Iraqi army is increasingly moving against the Sunni Awakening  Movement in Anbar and elsewhere.

In my view, an Iranian-Shia hegemony in 2008 and after is to be preferred to the continuation of Saddam's regime as it was in 2003 and before. (Some will probably disagree, of course.) But Halliburton & Co will only stay in Iraq if the Iranians want them to.

the war on terrorism

Richard, how much is this "deferred compensation" they are supposed to be glad-handing to Cheney worth pa?

Cheney's compo

It stopped a couple of years ago, Paul.  I'll have to look up and get back to you but top-of-head it was around $US 150,000 pa.  Signifigantly more than his iVice Prez salary, I know for sure.

At any rate, that was the one we could see.  There will be more, and when Cheney takes up private positions he's not exactly going to be short of a quid, I don't think.

I suppose you could consider his wife's position on the boards of  Lockheed and the American Enterprise Institute ((for whom Howard did his first  post-PM public speech) as part of the household income as well..  Wouldn't mind a peek at her share portfolio, either.

Freud Fraud

Having just read Richard Webster's Why Freud Was Wrong: Sin, Science and Psychoanalysis I'm rethinking my Freud, thanks Eliot.

I do however owe him gratitude for giving us memorable phrases and therefore the chance for me to earn fleeting editorial praise for a caption on his great-grandson's photo (the diminutive Mathew Freud - now married to Rupert's daughter), when he was very young and slim, as a Friendly Freudian Slip!

But within the context Freud was talking of dreams and Iraq is, of course, not a dream but a nightmare.


Michael de Angelos: "But within the context Freud was talking of dreams and Iraq is, of course, not a dream but a nightmare."


NEGOTIATORS have concluded a deal which will see the complete withdrawal of US troops from Iraq by 2011, ending an eight-year occupation, the top Iraqi heading the team said yesterday.

Under the 27-point deal, all US combat troops will be withdrawn from Iraqi cities by next June, the negotiator, Mohammed al-Haj Hammoud, said.

Do you recall how Ronald Reagan was called a fool, almost continually, up until and even after the collapse of the Soviet Union, mostly by the broad political Left which had for years itself been utterly gulled by the Reds?

And how is he remembered now?

How do you think those who opposed the overthrow of Saddam Hussein will be remembered?

Many still think Reagan was a fool

Eliot, I do recall the Reagan legacy.

The facts of Reagan's presidency survive the hagiography now being written. His life, as the cliché-soaked commentators note incessantly, may have been an "American life." But his presidency was no morning in America; it empowered and enabled some of the worst elements of public life in our country: greed, arrogance, neglect and hypocrisy. This Reagan legacy, unfortunately, survives its namesake, and, worse, it has been enhanced by the son of his Vice President.

Reaganomics led to the economic mess we find ourselves in. Dreamland has turned into Nightmareland.

Nearly every major bank, brokerage and lender you can name is up to its eyeballs in leveraged investments whose value is going up in smoke. They're borrowing hundreds of billions from the Fed. They're raising billions more from investors, diluting their shares. They're selling massive amounts of assets — scrambling any way they can to raise cash to survive.

Merrill Lynch, America's largest brokerage firm, has lost more than two thirds of its stock value. Citigroup, once America's largest bank by market cap, has lost even more. Washington Mutual has given up nine tenths of its value. On average, even including the strongest of the banks, half of the wealth of bank shareholders has been wiped out.

Unfortunately, the foolish policies of Ronald Reagan was copied by other fools such as Thatcher and Howard.

The economic policies of the Reagan administration had a major influence on economic policy in many countries. The spectacle of Ronald Reagan and UK Prime Minister Margaret Thatcher cutting taxes, privatising state-owned companies, and crushing powerful trade unions inspired conservative intellectuals all over the world. Political leaders in many countries tried to emulate the themes that were commonly associated with Reagan and Thatcher. As a result, Ronald Reagan managed to project US ideas and soft power more effectively than any other president of the modern era.

The pain we are about to suffer is a result of the Reagan folly.

Since the Reagan years, free-market clichés have passed for sophisticated economic analysis. But in the current crisis, these ideas are falling, one by one, as even conservatives recognize that capitalism is ailing.

You know the talking points: Regulation is the problem and deregulation is the solution. The distribution of income and wealth doesn’t matter. Providing incentives for the investors of capital to “grow the pie” is the only policy that counts. Free trade produces well-distributed economic growth, and any dissent from this orthodoxy is “protectionism.”

The old script is in rewrite. “We are in a worldwide crisis now because of excessive deregulation,” Rep. Barney Frank, D-Mass., the chairman of the House Financial Services Committee, said in an interview.

He notes that in 1999 when Congress replaced the New Deal-era Glass-Steagall Act with a looser set of banking rules, “we let investment banks get into a much wider range of activities without regulation.” This helped create the subprime mortgage mess and the cascading calamity in banking.

Most economists now consider that Reagan was a fool.

The Interpretation of Dreams

Richard, Michael, are you guys familiar with the term "overdetermination"?

The magician vanishes

Some of this, Eliot, reads like a Douglas Adams novel:

[wiki extract]

Overdetermination is problematic in particular from the viewpoint of a standard  counterfactual understanding of causation, according to which an event is the cause of another event if and only if the latter would not have occurred, had the former not occurred. In order to employ this formula to actual complex situations, implicit or explicit conditions need to be accepted to be circumstantial, since the list of counterfactually acceptable causes would otherwise be impractically long (e.g. the earth's continued existence could be said to be the (necessary) cause of one drinking one's coffee). Unless a circumstance-clause is included, the putative cause to which one wishes to draw attention could never be considered sufficient, and hence not comply with the counterfactual analysis.

What you're saying is that there's no way of proving which one of a number of possible catalysts created the global status quo?


Do you mean then...

this war was about oil?

Global monetisation

My personal theory nowadays, Michael?  It was about creating a state of flux in which one company could create US dollars out of as many resources as it could get its hands (or pipes) on.

It was about oil, uranium, water, and Iraq was/is far from the only battlefield.

Surely, if the major infrastructure project was Iraq, the infrastructure office wasn't put in Adelaide for proximity?

Cheney had better move quick

Richard Tonkin: "I'd take a guess that there will be much more activity between now and January, when Cheney leaves office."

It''s less than four months.

What Dick Did Next...

If you consider, Eliot, that the man was the US Defence Secretary who ramped up outsourcing, then left to preside over a company taking a signifigant share of this work, then returned to public office and started a war, then it's assumable that Cheney's had his departure date circled on the calendar for quite some time.

The forestalling of his efforts to get another front going in Iran might have buggered up his retirement plans, but Dick's a pretty clever guy.. no doubt he's thought of something by now.

As for plans coming to fruition..don't forget how much of the oilfield reconstruction contracts KBR were given.  The announcement was made while HAL CEO  Dave Lesar was riding the train to Darwin, remember?

That's odd...

And so what happened to the  "secret deal that would give the world's second largest oil services company total control over Iraq's oil fields"?

Because, four years later, this happened instead:

Iraqi officials say dozens of major foreign companies, including ones based in the United States, Russia and China, have expressed strong interest in developing fields or have done some work with the Iraqi industry.

What happened Eliot? Nothing

It doesn't hurt, especially when stating the status quo, to have a quick look at the day's news, Eliot. Eg entering Iraq oil contracts into Google News yields today's update:

[Guardian extract]

Iraq has been negotiating six no-bid, short-term technical support contracts with international oil firms, worth about $500 million each.

The deals would give global oil companies the first major foreign involvement in the OPEC member state's oil sector in nearly four decades.

The deals should have been signed earlier this year, but have been held up, in part due to disagreement over terms.

The six short-term deals involve Royal Dutch Shell; Shell in partnership with BHP Billiton; BP ; Exxon Mobil ; Chevron in partnership with Total ; and a consortium of Anadarko , Vitol and Dome.

Ries said Anadarko and some of its partners had already walked away from talks with the Iraqi authorities over their deal

What you've focussed on is basically how the Iraqis intend to split the profits amongst themselves. And that was six months ago. It appears not much else has happened since then.

I'd take a guess that there will be much more activity between now and January, when Cheney leaves office.

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