McQuaig: The thing is, it is about oil

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Sun Feb 16 15:31:46 MST 2003


>From the liberal daily newspaper, the Toronto Star

Feb. 16, 2003. 01:00 AM
The thing is, it is about oil

The astonishing thing about American power is not that it will soon crush
the feeble nation of Iraq, but that it has managed for months to keep world
attention riveted on Iraq's "weapons of mass destruction" when Washington's
real interest is Iraq's oil.

In saying that, I realize I risk being dismissed as a naive, knee-jerk

One is allowed to voice skepticism about the upcoming invasion and still
move in sophisticated circles these days. It's quite appropriate at a
cocktail party, for instance, to question the timing of the invasion or to
wonder whether the U.S. has the stomach to deal with post-war Iraq.

These are serious questions, according to New Yorker magazine editor David
Remnick, who at the same time is dismissive of those who think war is being
driven by "a conspiracy of oil interests."

Let me redeem myself slightly, by saying that I partially agree with the
sophisticates ‹ this war is not just about oil.

It's also, for instance, about eliminating an intransigent foe of Israel and
possibly diverting Iraqi water to Israel. And it's about giving George Bush
a major military victory, without risking nuclear mayhem too close to an

But it's also very much about oil. It's odd there's so much resistance to
this notion, since commentators sniff the oil factor quickly enough when
analyzing the motivations of countries like France and Russia.

These same commentators also generally subscribe to the view that the
ordinary person (or "homo economicus" as the economics textbooks call him)
is motivated by material self-interest.

But those who occupy the White House ‹ and who got there courtesy of
corporate financial backing ‹ are seen as different, eschewing material
concerns for higher ideals like peace and democracy. This, then, would be
the "sophisticated" view.

Let's look for a minute at Iraq's oil, even if no one else wants to.

One of the striking things about Iraq's oil reserves ‹ besides their sheer
volume ‹ is how undeveloped they are. This isn't just because of the past
decade of sanctions. It goes back to the 1920s when the seven major oil
companies (American and British) began operating in the Middle East.

The companies functioned as a cartel. With explicit agreements not to
compete against each other, they carved up the rich Middle East oil
reserves, thereby enabling them to control most of the world's oil supply
and keep prices and profits high. (All this was documented by a U.S. Senate
investigation in the 1950s.)

The fledgling Arab states, created out of the old Ottoman empire, had little
choice but to accept the piddling royalties the companies offered.

Iraq was always more demanding than the others. In the early 1960s, the
popular Iraqi leader Abdul Qarim Qasim invited in some independent oil
companies as competition for the cartel. The cartel didn't like that and,
since it controlled access to world oil markets, the independents stayed
away from Iraq. The cartel punished Iraq by pumping less Iraqi oil, thereby
reducing the nation's meagre revenues.

Instead of knuckling under to the cartel, Iraq tried something bolder in
1972: it nationalized its oil. (Neighbouring Iran had attempted a similar
nationalization in the 1950s, but the U.S. and Britain stepped in and
organized a coup that replaced the nationalistic leader there.)

The West couldn't really intervene to stop the Iraqi nationalization,
however, because Iraq invited in the Soviets to develop its oil fields and
buy its oil. 

The Iraqi deal with the Soviets ‹ regarded as the ultimate treachery by the
oil companies, Washington and London ‹ was negotiated by the Number 2 man in
the new Baathist regime that had seized power in Iraq. His name was Saddam

The companies and Western powers were further incensed the following year
with the emergence of OPEC as an aggressive cartel of oil-producing nations
determined to win a bigger share of the oil wealth, with Iraq the leading

Now, in the post-Soviet era, Iraq's oil fields remain huge, undeveloped,
ripe for exploitation ‹ and essentially unprotected. And the treacherous
Saddam remains in power.

But the idea that the U.S. is after oil is seen as simplistic and crass. It
suggests the White House is willing to use its immense military superiority
to advance the interests of its corporate elite, or to settle old scores.
Many people prefer to think of the U.S. as a benign force struggling to make
the world safe or, at worst, as a bumbling do-gooder that sometimes gets
carried away in its zeal to bring democracy to others.

Given the immensity of U.S. power, one can understand the temptation to
believe this. Any other interpretation may just seem too scary.
Linda McQuaig is a Toronto-based author and political commentator. Her
column appears every Sunday.

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