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Monday, January 02, 2006

"Oil executives don't drink whiskey"

I heard a spirited, yet civil, exchange on the Majority Report radio show on AAR tonight. The show featured a discussion between John Perkins (author of "Confessions of an Economic Hit-Man"), the hosts Janeane Garafalo and Sam Seder, and Janeane's father Carmine, who happens to have worked at Exxon in some capacity for the last 30 years. Carmine, somewhat of a staunch republican, apparently doesn't buy into the premise for Syriana, the depiction of oil executives thereof, the reasons for entering Iraq, etc. Janeane summed it up by saying something along the lines of "some people just don't want to know the truth, as it disrupts their belief system". For me, I still don't know whether Perkins plays up the snake-oil a bit too much, but nothing lately has negated any of his assertions. Perkins thinks the Iraq/euro connection created one rationalization for invading, yet Stirling Newberry thinks otherwise:
Fears about the US dollar - or about oil trading in Euros, are however, overblown. Instead, instability will help the dollar, as "flight to safety" will drive risk averse parked money here to the US. It doesn't matter what oil is traded in - the pound crumbled in the 1920's even though it was the unit of account for major commodities - but instead where the money is parked afterwards. Trading in euros will give Iran and other nations a hedge against another move on the dollar, but this is not significant. What is more significant is that there is a sharp willingness on the part of major dollar holders to move to Euro based stocks and bonds. The trigger point will be a European recovery. If europe can recover from its current economic slump, and raise rates, this will be a capital magnet. There are those that worry that this is destined to happen soon. However, the likelihood is that it will not happen until late in 2006 or early 2007, which means that the pressure on the greenback is still two years away.

The real tinderbox is not mechanisms, but control over the oil itself, and US attempts to keep nations that are oil holders vulnerable to US military pressure. ...
Of which Perkins acknowledged as well, in the context of China thirst for oil and their reliance on Iraq/Iran oil.

The Perkins segment starts in the second hour of the 3-hour program; the mp3 recording removes the commercials so you may have to scroll around for it: [MP3]

I end my vacation with a movie quote from the MR blog:
Three Kings (1999)

George Clooney's character: "I don't even know why we're [in the Middle East]."

character Ron Horn: "Don't start that with me."

Clooney: "Just tell me what we did here, Ron."

Ron: "What do you want to do- occupy Iraq- the new Vietnam all over? Is that your brilliant idea?"

and this from Pi:
Pi (1998)

Sol Robeson: "This is insanity, Max."
Maximillian Cohen: "Or maybe it's genius."


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