Wars are Fought to Keep Oil Under Dollars Control

March 24, 2004

By John Wilmerding

Enron, telecom, and the other unprecedented U.S. corporate
financial scandals were the warning sign. But government didn't
act, partly because Enron and the windfall profits generated by
manipulating California fuel prices in 2000 helped (s)elect Bush
into the White House. And everything the president has done
since then has been in favor of profits for the big corporate
entities that now essentially run the U.S. government.

The president's handler and chain-man, Vice President Richard
Cheney, rakes in illegal profits from Halliburton's massive
exploitation of the Iraq attack while almost no one seems to
notice. Rock-ribbed reactionary Supreme Court Justice Antonin
Scalia goes duck-hunting with people he has to sit in judgment
on the next week.

The rich everywhere seem to be on the take, winking at each
other right and left, but they are wrongly taking us for sitting
ducks. The poor are getting ready to eat them alive, and we
will have the state for dessert.

For years the wiser on why gold prices aren't going up, GATA,
the Gold Anti-Trust Action Committee, is trying to break the
Federal Reserve's and others' cartel-manipulation (downward)
of gold prices. Ironically, they are trying to do it on as
rationale of smart investment.

The operative theory says that the Federal Reserve, which
controls U.S. financial policies, is in cahoots with people who
know that the dollar would drop hugely in value if its gold-price
value were allowed to truly float in the commodities market.
So the Fed grabs huge chunks of the U.S. gold reserves in
Fort Knox and elsewhere and mortgages them -- commits
them to futures contract sales -- to keep gold prices down.
This is illegal and done in a clandestine fashion.

Another way the dollar's value has been propped up in recent
months is by huge Japanese buying of dollars. Basically they
are minting yen like crazy just for the purpose of buying dollars,
hoping either to save the U.S. economy or perhaps to buy
everything of value in the United States, depending upon your
point of view, or perhaps your fear.

So in recent months when other precious metals and
commodities have been going up in price to reflect the
several-years-long decrease in the dollar's buying value, the
price of gold has held rock-steady ... until now, that is. There
is speculation that finally a critical mass of investor
understands the statistical proofs of market manipulations,
and we are beginning to see a run on gold (people buying
lots of gold futures) that is becoming consistent.

If GATA's theories are correct and the gold market has been
held way low for a long time to keep U.S. inflation manageable,
it is possible that the price of gold in dollars could even
double or triple go beyond even that. If the value of the dollar
starts to become truly elastic to gold, then the dollar may have
to lose 50 to 75 percent of its buying power.

The result for U.S. consumers will be a deep, deep recession
or maybe even a depression as the U.S. economy finally
re-gears away from "services" and back to the production of
the food, clothing, shelter, and other necessities that the
U.S. populace needs. Long-term, this will be a very healthy
thing for the United States, but in the short term we could see
drastic shortages of gasoline, fuel oil, and other pricey and
limited commodities and consumer products that will flee the
United States and begin to chase the newfound buying power
of Europeans and people elsewhere.

We in the Committee for Equity-Restorative Justice observe
that this is why wars are fought: to maintain the dollar's
hegemony over oil, the primary strategic (read: military)
commodity. The theory here goes that the Saudis and others
rely on the United States to prop up their autocratic regimes
and in return support the 30-year-old fiat that has them
accepting only dollars to buy oil. This means that other
countries have to maintain significant reserves of dollars in
order to keep their oil market share. But if the bottom falls
out of the dollar's buying power, then the petro-dollar -- the
dollar as oil's fiat currency -- is doomed. This will also spell
the doom of the U.S. neo-cons' admitted plans for global
military and economic domination for the rest of the century.

Bottom line? If gold's value increases to some of the higher
estimates -- goes from $400 to perhaps $1,700 an ounce --
we in the United States will be looking at gasoline and heating
oil that runs between $5 and $10 a gallon.

Unthinkable? Think again; it's very possible. People in many
other countries, including Europe and Britain, for years have
been paying two, three, or even four times as much for
gasoline as we do here in the United States. Why? Because
our dollars have had such unwarranted buying power for so long.

Serious economists note that the United States produces little
of its essential commodities and industrial goods anymore,
and consequently is running up a monumental
balance-of-payments deficit. There are signs that the United
States is now truly desperate to prop up its economic statistics
and maintain the confidence of international financiers.

One of these signs is the recent reclassification of burger flippers
in fast-food restaurants as "manufacturing jobs." That should
boggle the mind. So many real U.S. factory jobs have been
exported that the country is propping up the job statistics with the
lie that burger flippers are manufacturers.

More to the point, about 2,000 tons of gold in storage at West
Point were recently reclassified from "deep storage" to "custodial
storage," which can mean that it is being held there for delivery
to a buyer or series of buyers.

It is this kind of thinking that caused the Enron and telecom
debacles -- accounting sleight-of hand to operate huge confidence
games that are robbing us and our children of future security and
opportunities. That and mortgaging our children's futures to
prosecute immoral wars that we can only lose.

Great international economic "corrections" are now the only way
that the world will lurch toward economic justice and reduce the
disparity in wealth and resources between the rich and the poor.
And millions upon millions of people -- possibly even billions of
people -- may die unless we begin to manage our economic
affairs better.

If the media begin to report things fairly, the scandals of this
presidency will include the bankrupting of the United States. I
predict here that this will be illustrated will be through
revelations of how many U.S. military service people are dying
of wounds and illnesses incurred in Iraq.

The U.S. economy today is a one-trick-pony, its only trick being
its efficient machinery for killing people, a nation of predatory
weapons of mass destruction. And we, the doves, are going to
put them out of business.

Non-violently, of course!

Posted by rlancaster at March 24, 2004 10:32 PM