I read at the IAEA Web site (“Safeguards Statement for 2004“):
“As of the end of 2004, 40 non-nuclear-weapon States party to the NPT had not yet brought comprehensive safeguards agreements with the Agency into force as required by Article III of that Treaty. For these States, the Agency could not draw any safeguards conclusions.”
Can you explain why those 40 states aren’t declared in noncompliance and referred to the Security Council for sanctions?
Gordon Prather replies:
Perhaps I can. Bush-Cheney-Bolton-Condi have deliberately confused the state of being in noncompliance with the NPT (by, for example, failing to conclude a Safeguards Agreement with the IAEA) and being in noncompliance with the IAEA Safeguards Agreement (which results from the use of materials, equipment, facilities, etc., that are safeguarded – or ought to have been – in furtherance of some military purpose). The IAEA Statute provides for the reporting by the IAEA Board of noncompliance of a Safeguards Agreement to the UN General Assembly and UN Security Council. The NPT makes no provision for reporting to any entity non compliance with the NPT. As the Iranians have noted, repeatedly, ElBaradei has yet to find Iran in noncompliance with Iran’s Safeguards Agreement, but the United States is – and has been – almost continually in a state of noncompliance with the NPT.
My thanks to Gordon Prather. I was wondering when Antiwar.com would bring attention to this particular explanation for the U.S. government’s actions with regard to Iraq and Iran (and Venezuela, by the way).
Throughout history, the arguments offered in favor of the creation and preservation of central banking have varied, but the one characteristic common to all central banking in all of history is that it finances government debt. The function of central banks is, and always has been, to allow governments to spend money without the political inconvenience of taxing people for the money first. The central bank does this in exchange for being granted a government-enforced monopoly on the issuance of bank notes. This allows the banks to lend out – and make interest on – money they don’t really have. This used to be called fraud. Nowadays it’s called fractional reserve banking, and a vast intellectual smokescreen has been emitted to justify its practice.
The value of a bank note is always initially derived from the commodity the note supposedly represents. Before 1933, a dollar was 1/20th an ounce of gold. A dollar bill was, at least in theory, a receipt for gold deposited at a bank. Obviously, banks and governments are heavily motivated by self-interest to weaken and, if possible, sever this link between bank notes and gold. The U.S. government started this process of money “tokenization” in 1933 and completed it in 1971. Since then, every dollar created by the Federal Reserve and the fractional-reserve system is wealth transferred from the economy as a whole directly to the banks and the government, and the amounts of money created are truly staggering.
There is much to say on this topic, but the relevant question is this: Once a government has succeeded in severing the link between a bank note and the commodity that once backed it, what is it that holds a currency in place? Some would have us believe that nothing more than cultural convention is needed to explain this, but the examples of worthless paper currency littered through history expose this lie. Legal tender laws are a partial explanation, but a better explanation is that one must have dollars to pay taxes, which are, as a rule, unavoidable, making dollars, as a rule, indispensable. This would at least explain how a currency could be made to hold its place as currency within a single country.
The requirement that dollars are needed to pay taxes in the United States, however, is not a satisfactory explanation for how the dollar has become the world’s reserve currency. The fact is that beginning in 1973, dollars have been backed not by gold, but by oil. As Gordon Prather’s article points out, one must acquire dollars if one is to purchase oil. When the Federal Reserve and the fractional-reserve system expand the money supply, they are not appropriating the wealth of the U.S. economy, but the economy of the entire world.
I’ve never seen anyone publicly address the consequences of this explanation of the Iraq war and the current belligerent attitude of the United States government towards Iran. One is that not only are the evangelical dispensationalists stooges for the neocons, but the neocons themselves are probably to some degree stooges for the even more faceless forces who shepherded them into positions of power. Another consequence of this explanation is that it is irrelevant whether or not Iran has, or plans to have, a nuclear weapons program. The only point of the accusations is to get people arguing about the wrong issue. As Thomas Pynchon said, if they can get you asking the wrong questions, they don’t have to worry about the answers. It doesn’t matter to those maneuvering for war with Iran whether oil hits $100 a barrel, or whether the war is eventually discredited. All that matters is that Iran’s oil bourse be stopped.
Writes Gordon Prather in “Currency War”:
“The Iranian Bourse will be competing directly with London’s International Petroleum Exchange and New York’s Mercantile Exchange, both of which are owned by U.S. corporations, and whose transactions are denominated in Dollars.”
This is false in every particular.
For starters, ICE/IPE isn’t owned by a U.S. corporation: it’s owned by a consortium of oil companies and banks, many of which are based in Europe. NYMEX is a private partnership and isn’t owned by any corporation at all. IPE trades many products denominated in pounds sterling (all of its natural gas and power contracts).
But the Iranian bourse (if it’s ever launched at all) won’t be capable of trading products deliverable to Europe or America so it isn’t in competition with these exchanges. Oil deliverable to Iran is useless to U.S. refiners who aren’t permitted to take delivery there or conduct business with any such exchange. An Iranian credit clearing mechanism would be off limits to any oil multinational, and it’s hard to understand why it might offer better credit risk, technological support, price transparency and liquidity than IPE/ICE or NYMEX. The idea is laughable.
Moreover, the argument that denomination of oil impacts policy or U.S. rates doesn’t hold water. Oil is routinely priced in euros on the world market already. “Dollar reserves” held by central banks aren’t used to buy the oil that’s traded. Dollar denominated bonds are routinely issued outside the U.S. To the extent that dollars are the de facto currency of oil trading, it’s because the U.S. is the largest buyer, and because oil sellers elect to hold dollar denominated assets (both in the U.S. and elsewhere). If that preference were to change, it would have nothing to do with pricing conventions of the oil market.
A Challenge That Cannot Be Ignored
Al Gore presented a long-overdue speech by a leading politician but it will likely fall on deaf ears. Right or wrong, Mr. Gore branded himself a compliant loser when he failed to put up much of a fight in 2000. He did so under the pretext of being a good guy and not making waves and so this, in addition to his sonorous and preachy presentation, marks him as a permanent also-ran. This is not someone the spectator nation cares to listen too hard to. We only want “winners,” even if they are of the middling sort and installed in their office by crisply minted money-men. Pity.
The Republic is already surrounded by darkness, but the listless spectators have not figured it out yet because it has not hurt them, directly, yet, that they know of. Virtually every wise tenet of the Founders has been willfully ignored over the span of the last 50 years or so and, as a result, America has been sacked by opportunist technocrats and statist money-grubbers for whom the Founders are simply mythology to be bent at will. Edwin Meese has been hailed by his “conservative” supporters as being the voice of “original intent.” Even though this cockeyed claim is more comical than beholding a baboon lecturing on human orthodontics, it is made and made on the pages of the so-called paper of record, the NY Times.
There is a kind of insane sic et non at work in the Times today, symptomatic of the larger societal confusion. Virtually every issue of the paper contains articles whose cheerleading headline claims are contradicted by information buried deep within the body of the article. The NY Times appears to be a puff-piece marketing brochure for busy scanners, saying one thing here and another there, and rarely if ever treading out past the front lines of popular conventional wisdom. David Brooks, a one-man monument to sophistry, is the prototype for the kind of cheerfully chatty ignorance that our vaunted “lifestyle” best represents now. He has been called a “conservative” that a “liberal” can like.
How fitting for a paper that requires a healthy dose of skepticism to get through nowadays. But the Times is not alone, far from it. Judith Miller was not atypical; she was the prototype for the insider journalists busying themselves in the court of the new monarchists who started to take Washington in broad daylight somewhere back when Richard Nixon limped away in disgrace. The terms “conservative” and “liberal” are meaningless now, little more than perhaps a fancy way to say “shirts” and “skins.” The discussion is not important any longer because it is the “winner” who we breathlessly watch.
The United States of America in 2006 is a nation that has forgotten its foundational roots and forsaken intelligent thought and discussion in favor of a warm spoon-feeding. It is about to get a real spanking at the hands of these counterrevolutionary “tough guys” who purport to lead.
Fity years of mass-market consumerism has replaced our brains with a credit card, and the payments are about to become due immediately. This is not an indictment of capitalism, it is an indictment of a people who think capitalism is a synonym for the Republic, rather than the robust servant it was intended to be.
A people who disdain intelligence and dissent while continuing to accept a power-grab by a group of ideologues and dimwits is a people who will learn to rue their misplaced allegiances the hard way. No conspiracy here, just affable ignorance in service to “going with the flow.” As R. Heinlein wrote: “Never attribute to conspiracy that which is adequately explained by stupidity.”
When intelligence and contradiction replace certainty and opinion (the higher form of a healthy sic et non), this Republic might have a chance to regain its historic course. Until that time, it better develop a taste for diminished expectations, circumscribed rights and escalating violence. The Founders knew this day would come and they left us the institutions to combat it with. I do not care who will lead this critical fight, “conservative” or “liberal.” But I do know what this person will be rightfully called: an American. I think we have one here on Antiwar.com in Mr. Roberts.
~ D.W. Sabin, Marbledale, Conn.
Paul Craig Roberts replies:
This is an excellent letter detailing the corruption that besets our society. And I thank him for his compliment.
Can a Nuclear Strike on Iran Be Prevented?
You are deliberately forgetting the fact that the new president of Iran has targeted Israel as a state to be swept off the map. Iran does not need the nuclear energy at all, given its huge reserves of oil. Those who are not willing to see the danger that the extremist regime of Tehran means for the peace of the world are mistaken themselves.
Jorge Hirsch replies:
The president of Iran, however ill-advised his comments are, talks about a political solution to the Palestinian situation involving the political elimination of Israel, not a military solution involving physical destruction. Iran has never attacked another state in modern times, nor has it ever threatened to attack another state. Israel has done both in connection with Iraq (1981) and Iran (now).
If you are so worried about Iran’s intentions, why aren’t you worried that Iran will attack Israel now with the weapons it has today (Shahab-3 missiles)? You are not worried because you know very well that Iran would not do it, even if it wanted to, for fear of retaliation by Israel and the U.S.
Similarly if Iran had a nuclear weapon or two, you know it wouldn’t use them against Israel because Israel and the U.S. would respond by wiping Iran off the map. You and others know very well that Iran is not a danger with or without nuclear weapons, but promote that fear to justify your “preemptive” attack.
As to whether Iran needs nuclear energy or not, it is not for you to decide, and you don’t know the facts. Read "Are Iran’s Arguments Sound?“
Justin’s logic of truce with bin Laden (and the Islamic world) is entirely rational and sound for the American people. (And his example of Adams’ speech regarding the true exemplar of American purpose is moving and correct.)
However, the “old economy” elite, which currently controls all in America, and will not abide in seeing their oily global Ponzi scheme (posing as an economy today) go into its inevitable death spiral even one day before they can prevent it, will block all progress until they are dispatched.
The majority of Americans, regardless of their serf-like existence, believe that in fighting to protect the ruling elite’s “way of life” they are protecting their own lives.
Fear, fear of change, has entrapped not only the “dead-ender” elite, who fear the rigors of Schumpeterian innovation, but unfortunately also the general population into one stream of lemmings.
Justin’s truth is that average Americans could survive and even benefit without the access to Mideast oil that a truce with bin Laden would inevitably bring. But fear, fear engendered by the “old economy” oily elite (which could not survive the loss of oil), has poisoned all.
Your statements about nuclear weapons are not very useful, e.g., a nuclear weapon is, after all, a bomb, and like all bombs there is a limit to its radius of destruction. Hiroshima was 15 kilotons and killed ~100,000 people; the largest nuclear bomb tested was 50 megatons, a factor of 3,000 more, so it would kill 300 million people in the neighborhood. And there are the equivalent of about a million Hiroshima bombs in existence. So to say “we are all still here” is silly and wrong: 200,000 in Hiroshima and Nagasaki are not here anymore, and many thousands, millions, or possibly even billions will not be here if more nuclear weapons go off.
Having said that I certainly agree with you that even a nuclear Iran would pose no great danger, and that attacking Iran would be stupid. Unfortunately, I don’t believe as you do that this administration has enough sense not to do it.
~ Jorge Hirsch
