Greenspan: Iraq War was about oil

[Durandal]

Iraq was about oil: Alan Greenspan
16th September 2007, 8:32 WST

Former Federal Reserve Chairman Alan Greenspan, in his new book, says the US went to war in Iraq motivated largely by oil.
Greenspan said: "I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil."

Greenspan's book also criticises President George W Bush for not responsibly handling the nation's spending and racking up big budget deficits.

A self-described "libertarian Republican," Greenspan takes his own party to task for forsaking conservative principles that favour small government.

"My biggest frustration remained the president's unwillingness to wield his veto against out-of-control spending," Greenspan wrote.

Bush took office in 2001, the last time the government produced a budget surplus. Every year after that, the government has been in the red. In 2004, the deficit swelled to a record $US413 billion ($A493.75 billion).

"The Republicans in Congress lost their way," Greenspan wrote. "They swapped principle for power. They ended up with neither. They deserved to lose."

In 2006, voters put Democrats in charge of Congress for the first time in a dozen years.

Greenspan's memoir, "The Age of Turbulence: Adventures in a New World," is scheduled for release Monday. The Associated Press purchased a copy Saturday at a retailer in the Washington area.

The book is a recollection of his life and his time as Fed chief.

Greenspan, 81, ran the Fed for 18 1/2 years and was the second-longest serving chief. He served under four presidents, starting with his initial nomination by former President Ronald Reagan.

He says he began to write the book on February. 1, 2006, the day his successor - Ben Bernanke - took over.

The ex-Fed chief writes that he laments the loss of fiscal discipline.

"'Deficits don't matter,' to my chagrin, became part of Republicans' rhetoric."

Greenspan long has argued that persistent budget deficits pose a danger to the economy over the long run.

At the Fed, he repeatedly urged Congress to put back in place a budget mechanism that requires any new spending increases or tax cuts to be offset by spending reductions or tax increases.

Large projected surpluses were the basis for Bush's $US1.35 trillion ($A1.61 trillion), 10-year tax cut approved in the summer of 2001.

Budget experts projected the government would run a whopping $US5.6 trillion ($A6.69 trillion) worth of surpluses over the subsequent decade after the cuts. Those surpluses, the basis for Bush's campaign promises of a tax cut, never materialised.

"In the revised world of growing deficits, the goals were no longer entirely appropriate," Greenspan noted. Bush, he said, stuck with his campaign promises anyway. "Most troubling to me was the readiness of both Congress and the administration to abandon fiscal discipline."

Greenspan, in testimony before Congress in 2001 gave a major boost to Bush's tax-cut plan, irking Democrats.

At that time, Greenspan argued a tax cut could help the economy deal with sagging growth. The economy slipped into a recession in March 2001. The downturn ended in November of that year.

Surpluses quickly turned to deficits after the bursting of the stock market bubble and the 2001 recession cut into government revenues.

Government spending increased to pay for the fight against terrorism and receipts declined because of a string of tax cuts.

The Bush White House defended its fiscal policies in light of the Greenspan book.

"Clearly those tax cuts proved to be the right medicine for an ailing economy," White House spokesman Tony Fratto said. The 2001 recession was a mild one.

"Tax cuts contributed a portion to early deficits, but those tax cuts accelerated growth over time leading to increased business activity, increased job growth and increased tax receipts, which today has us at low historic deficit levels and on a path to a surplus," Fratto said.

As to the spending side, Fratto added: "We're not going to apologise for increased spending to protect our national security."

Greenspan said he was surprised by the political grip that Bush exerted over his administration.

The Bush administration turned out to be different from "the reincarnation" of the Ford administration that Greenspan said he had imagined. "Now the political operation was far more dominant." Greenspan was chairman of the Council of Economic Advisers under President Ford.

Greenspan enjoyed a good relationship with Bush's predecessor, former President Bill Clinton, "a fellow information hound".

They also were on the same economic page. During the Clinton administration, budget deficits turned to surpluses. But Greenspan was "disappointed and sad" when news surfaced that Clinton had an affair with Monica Lewinsky, a White House intern.

When Bush's father, George HW Bush, was president, Greenspan recalled that he found himself in a public conflict with the White House. Greenspan had suggested inflation risks were still high enough that the Fed would be more inclined to boost interest rates, rather than lower them. The president quickly challenged the notion.

For Bush's father, the economy was his "Achilles' heel, and as a result we ended up with a terrible relationship." The economy went into a recession in the summer of 1990 and emerged from it in the spring of 1991.

Many supporters of the elder Bush blamed Greenspan's tight-money policies for the recession that contributed to Bush's loss to Clinton.

Greenspan's memoir includes his early years growing up in a New York City neighbourhood of low-rise brick apartment buildings filled with families of Jewish immigrants, his stint as a jazz musician and his decades as a Washington policymaker.

On other topics, Greenspan:

- Questions whether global powerhouse China can continue its economic successes over the long run if it does not incorporate democratic processes. However, he predicts that if Beijing continues to move ahead on free-market principles "it will surely propel the world to new levels of prosperity".

- Predicts the most important economic decision US MPs and courts will confront in the next quarter century will be to clarify rules involving intellectual property - patents, copyright and trademarks.

- Proposes lowering barriers to skilled immigrants and improving education to narrow income inequality.

Well clearly he's just another lefty conspiracy theorist.

[Flagg]

Umm... DUH!

Everything that the US does in the Middle East is about oil.

[Darth Wong]

I'm reminded of the documentary "The War Tapes", about a group of NG reservists in Iraq. One of them, upon returning home and talking about his inner demons and lasting problems, said that "it better be about oil". His reasoning was that the war would be justified if it helped make Americans richer or more comfortable, but if George W. Bush was telling the truth about going there to help free people and spread democracy, then it wouldn't be worth it at all.

Not only does everyone know it was about oil, but a sizable contingent probably thinks that's just fine. I still remember Gulf War I 16 years ago, and once again, everyone knew it was about oil. But since they won, everyone thought it was just awesome.

[Flagg]

I'm reminded of the documentary "The War Tapes", about a group of NG reservists in Iraq. One of them, upon returning home and talking about his inner demons and lasting problems, said that "it better be about oil". His reasoning was that the war would be justified if it helped make Americans richer or more comfortable, but if George W. Bush was telling the truth about going there to help free people and spread democracy, then it wouldn't be worth it at all.

Not only does everyone know it was about oil, but a sizable contingent probably thinks that's just fine. I still remember Gulf War I 16 years ago, and once again, everyone knew it was about oil. But since they won, everyone thought it was just awesome.

Yeah, but at least we all had a nice moral highground to go in on. We could actually believe the lie that it was about freeing Kuwait from the horrors of Iraqi occupation. Especially since we did actually liberate Kuwait as a side effect of ensuring Saddam didn't get a hold on their oil fields.

[Fingolfin_Noldor]

There will always be idiots around, who think that it is fine that the US intervene where ever they like, in the name of national interest, ignoring the fact that things have a habit of backfiring.

[FSTargetDrone]

Incidentally, this story is at the top of Fox News' website, in big letters.

Anyway, this is all well and good, but where was this critique of Bush when Greenspan was still at the Federal Reserve? Just as with Colin Powell, and others, I want to know where the heartfelt soul-searching and disdain of the current administration's policies and actions that some of these powerful Republican lament upon before they leave office?

[Coyote]

Is it that the war was about oil-- a strategic resource-- or is it that the war was sold on a platform of high-falutin' stuff about freedom & democracy?

Look at it this way: we've had wars over who controlled what block of rock stuck out into the sea (Gibraltar, Bosphorous & Dardanelles); wars about which royal first cousins were porking and who the land belonged to (all of Europe during the Medieval era), Britain and China fought a war over who got to push opium...

Really, a war over oil kinda makes sense. At least its a goal with clear benefits. I think its that they made a mockery of the plight of the Iraqi people by ballyhooing false concern and croc tears over their fate...

[Adrian Laguna]

I'm reminded of the documentary "The War Tapes", about a group of NG reservists in Iraq. One of them, upon returning home and talking about his inner demons and lasting problems, said that "it better be about oil". His reasoning was that the war would be justified if it helped make Americans richer or more comfortable, but if George W. Bush was telling the truth about going there to help free people and spread democracy, then it wouldn't be worth it at all.

War for the spread of democracy is inherently stupid. That is unless the populace demands that the government spread democracy at gunpoint. The British Empire in the 19th century used the Royal Navy to shut down at gunpoint the parts of the slave trade that wouldn't be bought-out, and it did this because the British populace demanded it.

If there is no popular demand for it, and the US citizenry would be honestly hard pressed to care less about foreign countries they can't even find on the map, then spreading freedom and democracy is a great waste of manpower and resources.

I still remember Gulf War I 16 years ago, and once again, everyone knew it was about oil. But since they won, everyone thought it was just awesome.

I've recently been considering the idea that we should have let Saddam keep Kuwait. The United States propped him up in the 70s, and he served as a barely useful counter-weight to Iran. We probably should have just stuck by him. He may have been a bastard, but he was our bastard, and the best way to exert influence in the region without losing precious American bodily fluids.

[Nephtys]

It's this weird thing about Americans. We are told constantly that democracy is an inherent good, and anyone who thinks otherwise wants a tyranical dictator to tell you what to do. Everybody will do better with democracy! Every school child knows that, right? You don't want the King of England repressing you, right?

Of course, reality is a lot harder for some people to accept than that. A dictator is exactly what you need in a country with an uncontrollable population, like say.. Iraq. The US Public who actually bought into the 'we need to bring them freedom' crap is probably the same ones who still think the war is going fine. After all, giving these people a democratic system SURE WONT result in theocracy. Nope, no sir! We're being welcomed in the streets. Pay no attention to the RPG behind the curtain.

[The Kernel]

This was inevitable. Greenspan has long kept his mouth shut under his own set of ethics that dictated that a Fed chief does not talk about the administration it serves except in broad, constructive terms.

You have to have followed Greenspan's statements for a while, but I always kinda figured he had a love affair with Clinton's policies and that he thought GWB was a fucking moron. You don't have to be a genius to see that the current Republican party's spending policies are enough to drive a fiscal conservative inflation fighter like Greenspan into convulsions.

[The Spartan]

Didn't tWat admit as much last year during election season? I seem to recall him saying something about that last October.

[Darth Wong]

This was inevitable. Greenspan has long kept his mouth shut under his own set of ethics that dictated that a Fed chief does not talk about the administration it serves except in broad, constructive terms.

I'm sick of this "you can't trash your boss" ethic. It might make sense if there were some kind of mutual agreement of professionalism, but this administration has been firing qualified people left and right to replace them with cronies and flunkies. If the employer is not treating the employees with respect, why should the employees not return the favour?

It reminds me of the people who lament the death of "employee loyalty" despite the fact that corporations have increasingly shown a willingness to dump employees at the drop of a hat, or even to get a temporary stock price spike so that executives can dump their stock options and walk away with a boatload of money.

[Admiral Valdemar]

Umm... DUH!

Everything that the US does in the Middle East is about oil.

You'd think this would be obvious to even the most conniving Republitard, but apparently not. That the ME has nothing else to offer the world other than jihadis and dates doesn't factor into it. No, we're apparently in Iraq because we've got a heart of gold, never mind the clusterfuck that is Africa which has needed more attention for a lot longer and was primarily our fault in the first place, oh no. We need to help those poor Arab nations, because they're so chummy with us. And they have this black goo that makes us rich.

It's like it's so obvious the Bush followers cannot comprehend it and instead vouch for the convoluted "spread peace and democracy" bullshit that might have worked in the Cold War, but is now hopelessly transparent and more destructive. After all, the US has caused more deaths in Iraq than even Saddam managed in the same time frame. The excuse for that involves omelettes and breaking a few eggs.

[Coyote]

How is the situation Africa is in "our fault"? If anything, we've ignored Africa except for a few strategic points during the Cold War (ie, South Africa, the Horn).

[Admiral Valdemar]

How is the situation Africa is in "our fault"? If anything, we've ignored Africa except for a few strategic points during the Cold War (ie, South Africa, the Horn).

I think fucking up our colonial days and then ignoring them is a pretty big error.

[Coyote]

There I was, thinking like an American again.

Hey, don't get down. The French, Italians, Dutch and Belgians helped a lot, too.

[Admiral Valdemar]

True enough, but the fact is, we'd probably have a bigger industry for the globe and hear less from Bob Geldof if we stuck to it and didn't let them have independence until they got past that whole warlord shit.

Now I expect Chindia to do what we should have done, only with less Martini-Henry action.

[Coyote]

True enough, but the fact is, we'd probably have a bigger industry for the globe and hear less from Bob Geldof if we stuck to it and didn't let them have independence until they got past that whole warlord shit...

But then you get accused of the patronizing "white man's burden" point of view. Damned if you do, damned if you don't.

[K. A. Pital]

This isn't any news to anyone outside America. Hell, since the 70's and 80's most of the people probably understood that American involvement in both Middle East and South America is centered around controlling natural resources, namely fossil fuels.

Only Americans think America is doing it out of altruism (since when did powerful nations do anything out of altruism? Even WWII wasn't about altruism, it was more about securing Europe from a pact of warmongering fascist nations, who incited war in the first place).

Where the fuck does this "spread freedomm!" come from?

Imperialism and national interests never fade - they only take on different forms. The idea that there's no competition between nation-states for resources, economic, political and military domination is absurd. Nation-states are subject to competition in the world just as businesses are in the laissez-faire market.

Anyone who doesn't see that is a moron.

[Lonestar]

Where the fuck does this "spread freedomm!" come from?

It's a grand ole tradition of ours, dating back to at leats 1896.

[Lonestar]

*1898.

Damnit.

[SirNitram]

I don't really fathom why anyone is thinking Greenspan has integrity and intelligence for this. He consistantly argued he had no legitimacy in doing anything about the bubbles he presided over, defended the Bush tax cuts, and whined powerlessness to do anything about the current implosion.

I recall an article where a British bank official snarked at him. There was a line about Greenspan being reluctant to forecast recessions while in office. That's not a man with integrity, that's a man trying to inflate his PR.

[J]

I don't really fathom why anyone is thinking Greenspan has integrity and intelligence for this. He consistantly argued he had no legitimacy in doing anything about the bubbles he presided over, defended the Bush tax cuts, and whined powerlessness to do anything about the current implosion.

And the truth is finally spoken. Greenspan more or less rolled one bubble into the next larger one, financing it with leveraged debt and liquidity created by artificially low interest rates. Unfortunately, we're now at the point where the housing bubble cannot be rolled into an even larger bubble, and there's little liquidity left to be created to cushion the fall from the current bubble.

[Adrian Laguna]

True enough, but the fact is, we'd probably have a bigger industry for the globe and hear less from Bob Geldof if we stuck to it and didn't let them have independence until they got past that whole warlord shit.

I don't know how to put it without sounding racist, but the colonies with the greatest proportion of white people: South Africa, Namibia, and Botswana, are all decently prosperous. Also, Zimbabwe was doing pretty good back when it was called Rhodesia. Everything north of that is pretty fucked-up. Though Sudan, at least, is Egypt's fault.

[Pelranius]

The Gambians also did pretty well for themselves, and the Cote'd Ivorians until recently.