Last week I was reading an article on Financial Times about what is coming for 2008 some quakes (economics) of high level that would move all the status quo that reigns today, USA began conquering most of the world markets cuz the GLOBALIZATION, but now some other big players (INDIA & China) would gAIN control and a bigger GNP that the mighty Empire.
this would be the first time in history that an Empire FALLS because economic problems!!!
Some other big economic group has a mighty GNP bigger than USA, UE no no BRIC (Brazil, Russia, India and China) how about that??
Showing posts with label China. Show all posts
Showing posts with label China. Show all posts
Monday, December 10, 2007
Tuesday, November 13, 2007
DOLLAR downward spiral
This past month has been a pretty hard time for US Dollar, it has lost a lot of value against gold and EURO, and that is why the Oil is so expensive these days nearly $95, People already stop buying US bonds usually they were buying $97 billions and now only $19 billions WHAT A DEFICIT!!! this is a very very bad situation for a country that get use to live beyond they can, and now the situation is getting worse some 6 countries are taking steps to drop Dollar:
Saudi Arabia, closest US oil provider, is taking measure to avoid any recession like in the US so they are not going to cut interest rate, this country has $800 billion on US Bonds if they start selling them it would begin a massive stampede to do the same.
South Korea, they have plans to diversify their invests outside since 2005, but now they are getting ready to shift from Dollar, cuz that currency lot value agains oil, Euro and against their own money, so plans of selling $1 billion in US bonds are very real now, on august 2007 they sold $100 million of US bonds. Asia alone has $2 trillion in US Securities and other invesment instruments.
CHINA, since they decided to drop the peg of Yuan with Dollar and decide that currency would be floating against other currencies, Yuan appreciate agains Dollar, but NUCLEAR OPTION against Dollar is still an option cuz USA want to put some trade sanctions agains them, so they use their huge amount of US bonds and instruments like a bargain chip.
RUSSIA, want to establish an alternative way for trading oil and commodities (not in dollars), since 2005 they decide to put more EUROS on the Money reserves and to put EURO Peg to Ruble.
IRAN, the most likely to abandon US DOLLAR, their first move to ask Japan to pay any Oil exports in euros, and also since 2006 they made the idea of an Oil bourse in their country to trade commodities (oil & Gas) in Euros. In October 2007 85% of their Oil sells where in other currencies (NO MORE DOLLARS)
Dollar against, Oil, Euro, click for a bigger picThis 6 countries represent a lot of OIL WEALTH (except Korea), they are trying to protect their own interest and economy, so if they start droping US DOLLARS it would be a high impact on US Economy.
RELATED LINKS
Fears of dollar collapse as Saudis take fright
China launches currency shake-upKorea To Limit Its Dollar Holdings
Russian Rouble to Attack the U.S.$?
Wednesday, October 17, 2007
how China can Crash the US Dollar
Another good essay about this global economic issue, even that the fall of US dollar would affect all the world, the biggest damage would be in the US.
Over the last 30 years, China’s economy has grown at an average annualized rate of nearly 10%. While this statistic alone is jaw-dropping, what is more impressive is the extent to which the nominally Communist country’s economy has become intertwined in the global economy. China now exerts enormous influence over the economies of virtually every country in the world, and a slight change in its domestic economic policy has the potential to send shockwaves rippling throughout the world. Nowhere is this more apparent-and frightening-then in China’s economic relationship with the United States, which is very much at the mercy of China when it comes to prices, wages, interest rates, most importantly, the value of the Dollar.
The precariousness of this relationship is already the subject of significant publicity, redolent of the Japanaphobia of the 1980’s that saw American economists scare-mongering about Japanese control of the US economy. [Of course this later turned out to be unfounded, but that is beyond the scope of our discussion.] With regard to China, most of the analysis is focused on its growing foreign exchange reserves, the majority of which are held in Dollar-denominated assets. This article will go beyond forex reserves and discuss several other facets of China’s economy. From US house prices to global commodity prices, from interest rates to inflation rates, we will explore how China could cripple the US economy, both willfully and unintentionally, if so desired.
Forex Reserve Diversification
Let’s begin with an examination of China’s forex reserves, which is probably China’s biggest bargaining chip in its economic relationship with the US. Up until two years ago, China’s currency, the RMB or Yuan, was pegged to the Dollar. As with any peg, there often develops a discrepancy between the fixed value of the currency and the value that the market would assign if the currency were permitted to float. As China’s economy surged ahead, especially over the last five to ten years, tremendous pressure began to build under the RMB. In order to maintain the peg and hold down the value of the RMB, China began accumulating foreign exchange reserves by withdrawing foreign currency from circulation. Today, China’s foreign exchange reserves are massive, at $1.4 trillion as of September 2007.
In the eyes of American policy-makers, this presents a problem because the majority of these reserves are held in Dollar-denominated assets, namely in the form of US Treasury securities. The US government theoretically could not be happier that foreign Central Banks are willing to finance its perennial budget deficits. However, this borrowing has reached a point where foreigners now control over 40% of the US national debt. Moreover, long-term US interest rates are market-driven, based on the buying and selling of US government bonds. In other words, the US has gradually ceded control of its long-term interest rates to foreign Central Banks, namely China and Japan.
As the Dollar has depreciated over the last five years, many Central Banks have begun “diversifying” their forex reserves, by switching from Dollar assets to assets denominated in other currencies. This is problematic for the Dollar for two reasons. First, switching from US assets to European assets, for example, directly causes the Dollar to depreciate. Second, the bulk sale of US treasury securities (whether or not they are replaced with other US-assets) causes US bond prices to decline and hence, yields to increase. Thus, if China suddenly decided to diversify its reserves, for economic and/or political reasons, it could potentially crash the Dollar and send US long-term interest rates skyward. Since mortgage rates are tied directly to government bond yields, a rise in interest rates would probably also affect US real estate prices. Higher interest rates would make borrowing for a home more difficult, which would lower the demand for houses and thus, the value of American real estate.
In fact, China recently created the China Investment Co. Ltd., capitalized with almost $300 Billion, charged with investing its vast forex reserves in higher-yielding assets. However, the company’s inaugural investment was a stock purchase in the Blackstone group, an American private equity firm. Thus, while it seems likely that China will gradually discard some of its stock of US Treasury Securities, the affect on the value of the Dollar will be minimal. Besides, while China would certainly punish US businesses and consumers by unloading US Treasuries on the market, it would punish itself even more, since the value of the government bonds that it didn’t sell would decline. In short, it seems China will probably hold off on exercising its “nuclear option” for the time being.
Currency Manipulation
The second aspect of the China-US economic relationship which China could wield to its advantage is the RMB, itself. American public officials enjoy criticizing China for failing to allow its currency to appreciate more quickly. In fact, there is a bill that has been lying dormant in the US Congress, which threatens to slap a massive across-the-board tariff on all Chinese imports if China fails to allow the RMB to appreciate adequately against the Dollar. What policymakers don’t realize is that a rapid appreciation in the RMB would actually harm the US economy.
Coupled with its growing role as the world’s factory, China’s cheap currency has made Americans wealthier, by increasing their purchasing power. As production of labor-intensive goods was outsourced to China over the last decade, prices for finished products began to fall both in real terms and in nominal terms. While the effect on US employment trends is debatable, its effect on prices has been unambiguous. Thus, even while the American economy boomed, inflation remained relatively modest by historical standards. This allowed the Federal Reserve Board to hold interest rates down and foment economic growth.
As the RMB appreciates, Chinese producers will become ever-more forced to pass along some of the price increase to consumers. Now, if China was to suddenly revalue its currency by the 25%-30% that western policy-makers are demanding, prices on a whole host of Chinese products would jump up overnight. This would adversely affect American purchasing power and limit consumption to such an extent that the US would be in danger of slipping into recession. While the trade deficit that is the bane of American politicians’ existence might decrease in the long-term, it would skyrocket in the short-term. Besides, as many analysts have been quick to point out, there is not much overlap between Chinese and American production. Thus, a more expensive Yuan would send production to other parts of Asia, rather than back to America. While the US-China trade deficit might narrow, it would be offset by increased imbalance with the rest of Asia. Just like with the case of its foreign exchange reserves, however, China is unlikely to exercise this option because it would deal equal harm to itself. China’s ruling Communist party derives most of its legitimacy from the strength of its economy, and especially exports. If a more expensive Yuan forced producers to relocate to other parts of Asia, it would certainly spell trouble for the CCP!
Direct Competition with US Exporters
A more potent (and plausible) weapon would be to compete more directly with US exporters, by expanding into high-technology products. Currently, China specializes in manufacturing labor-intensive products, which have long since been manufactured outside of the United States. As previously stated, a revaluation of the Chinese Yuan would surely not return production to the US. However, if China were to expand into capital-intensive and/or high-technology products, it could easily steal marketshare and jobs from the US.
Limiting the Importation of US Products
Of course, there is also the imports side of the trade equation. China is quickly becoming one of the United States’ largest export markets; limiting the importation of US goods and services would certainly be felt in the US. In fact, China already requires multinational companies in many industries to form joint ventures with Chinese companies in order to produce and/or sell their wares in China. Other anti-competitive measures include tariffs, import taxes, quotas, or a simple ban on the importation of certain types of products. Each would have a devastating impact on the US trade deficit with China and would probably result in retaliatory sanctions by the US.
Wage Pressure
Next, there is the impact that China has exerted on global wages. When Deng XiaoPing’s famous tour of the South in 1979 ignited three decades of dizzying growth, hundreds of millions of Chinese were added to the global labor pool overnight. Yet, the majority of China’s population remains concentrated in rural areas. In fact, there are perhaps 500 million Chinese peasants that have yet to join the modern labor force, which means the full effect of China’s economic explosion has yet to be fully realized by the rest of the world. Already, there is no hope of unskilled work that has already been outsourced returning to the US. If/when China begins to expand into the production of high-technology goods and more complex services, it will encroach on the territory of American businesses. Unfortunately for the US, China will likely make these undercapitalized sectors of its economy more of a priority in its next five year plan.
One popular method for estimating GDP is the income approach, which as its name suggests, represents a summation of the reported incomes of a given country’s domestic population. Logic dictates that downward pressure on the wages of skilled American workers would negatively impact US GDP, and at the very least, would curtail the purchasing power of American consumers. This would also limit US exports to China, since Chinese would have homegrown alternatives to choose from.
Raw Material Pricing
In addition, there is the impact that China’s economic growth has exerted on global raw material prices. It has been said that 25% of the world’s construction cranes are currently located in China, to support the country’s building boom. These massive development and infrastructure projects require proportionally massive quantities of raw materials, namely cement and steel. Unfortunately, China is especially inefficient at converting raw materials into finished products. Combined with the CCP’s emphasis on the near-term (which inherently prioritizes low cost over efficiency), this is placing a tremendous strain on global energy supplies, driving prices skyward.
Competition for Energy
The global prices for oil and coal are already at record highs and China only consumes 1/15 the amount of per-capita energy as the US! Chinese energy companies are becoming increasingly visible, scouring the globe for stable supplies of energy and often coming head-to-head with American energy companies. Conveniently, China does not recognize the ethical issues which arise from purchasing energy from dictatorships and corrupt regimes, whereas US companies are limited from doing business in these places. From Sudan to Myanmar to Kazakhstan, Chinese companies have set up join ventures where US companies could not. While energy prices have certainly risen in the US, they have not kept pace with global energy prices. In this way, China is able to ensure that its citizens and its businesses have the oil, coal, and natural gas that they require, while their American counterparts may be forced to conserve.
Two years ago, the Chinese National Offshore Oil Company (CNOOC) attempted to purchase an American energy company, Unocal, for over $18 Billion. However, the deal was blocked by the US Congress, which feared Unocal’s energy reserves would be supplied to China at the expense of Americans. It did not help CNOOC’s case that 70% of the Company was effectively owned by the CCP. Needless to say, Chinese government officials were not happy with the outcome; (Unocal was ultimately sold to Chevron for a lower price). China has already shown its willingness to use extreme tactics to secure an adequate energy supply. It seems reasonable to expect its energy policy will continue to oppose and inconvenience the US.
Conclusion
In short, China has several economic “weapons” at its disposal for countering the US, ranging from the manipulation of its currency to the diversification of its burgeoning stock of forex reserves. It also has several less blunt options to choose from, such as enabling Chinese companies to compete more directly and effectively with US companies, and opposing the US in securing a domestic energy supply. On all of these fronts, the US is essentially being held hostage, since it has become so dependent on China as the world’s factory. Ultimately, it seems unlikely that China will deliberately butt heads with the US unless it is first provoked, but America should nonetheless be on its guard, since its economy hangs in the balance.
Thursday, October 04, 2007
Russia China Alliance vs USA Imperial Ambitions
Another interesting article I found, and want to share with u, this alliance threats USA Imperial Ambitions on ASIA
“But if the middle space [Russia and the former Soviet Union] rebuffs the West [the European Union and America], becomes an assertive single entity, and either gains control over the South [Middle East] or forms an alliance with the major Eastern actor [China], then America’s primacy in Eurasia shrinks dramatically. The same would be the case if the two major Eastern players were somehow to unite. Finally, any ejection of America by its Western partners [the Franco-German entente] from its perch on the western periphery [Europe] would automatically spell the end of America’s participation in the game on the Eurasian chessboard, even though that would probably also mean the eventual subordination of the western extremity to a revived player occupying the middle space [e.g. Russia].”
-Zbigniew Brzezinski (The Grand Chessboard: American Primacy and Its Geostrategic Imperatives, 1997)
Sir Isaac Newton’s Third Law of Motion states that “for every action there is an equal and opposite reaction.” These precepts of physics can also be used in the social sciences, specifically with reference to social relations and geo-politics.
America and Britain, the Anglo-American alliance, have engaged in an ambitious project to control global energy resources. Their actions have resulted in a series of complicated reactions, which have established a Eurasian-based coalition which is preparing to challenge the Anglo-American axis.
Encircling Russia and China: Anglo-American Global Ambitions Backfire
“Today we are witnessing an almost uncontained hyper use of force — military force — in international relations, force that is plunging the world into an abyss of permanent conflicts. As a result we do not have sufficient strength to find a comprehensive solution to any one of these conflicts. Finding a political settlement also becomes impossible. We are seeing a greater and greater disdain for the basic principles of international law. And independent legal norms are, as a matter of fact, coming increasingly closer to one state’s legal system. One state and, of course, first and foremost the United States, has overstepped its national borders in every way.”
-Vladimir Putin at the Munich Conference on Security Policy in Germany (February 11, 2007)
What American leaders and officials called the “New World Order” is what the Chinese and Russians consider a “Unipolar World.” This is the vision or hallucination, depending on perspective, that has bridged the Sino-Russian divide between Beijing and Moscow.
China and Russia are well aware of the fact that they are targets of the Anglo-American alliance. Their mutual fears of encirclement have brought them together. It is no accident that in the same year that NATO bombarded Yugoslavia, President Jiang Zemin of China and President Boris Yeltsin of Russia made an anticipated joint declaration at a historic summit in December of 1999 that revealed that China and the Russian Federation would join hands to resist the “New World Order.” The seeds for this Sino-Russian declaration were in fact laid in 1996 when both sides declared that they opposed the global imposition of single-state hegemony.
Both Jiang Zemin and Boris Yeltsin stated that all nation-states should be treated equally, enjoy security, respect each other’s sovereignty, and most importantly not interfere in the internal affairs of other nation-states. These statements were directed at the U.S. government and its partners.
The Chinese and Russians also called for the establishment of a more equitable economic and political global order. Both nations also indicated that America was behind separatist movements in their respective countries. They also underscored American-led amibitions to balkanize and finlandize the nation-states of Eurasia. Influential Americans such as Zbigniew Brzezinski had already advocated for de-centralizing and eventually dividing up the Russian Federation.
Both the Chinese and Russians issued a statement warning that the creation of an international missile shield and the contravention of the Anti-Ballistic Missile Treaty (ABM Treaty) would destabilize the international environment and polarize the globe. In 1999, the Chinese and Russians were aware of what was to come and the direction that America was headed towards. In June 2002, less than a year before the onslaught of the “Global War on Terror,” George W. Bush Jr. announced that the U.S. was withdrawing from the ABM Treaty.
On July 24, 2001, less than two months before September 11, 2001, China and Russia signed the Treaty of Good-Neighbourliness and Friendly Cooperation. The latter is a softly worded mutual defence pact against the U.S., NATO, and the U.S. sponsored Asian military network which was surrounding China. [1]
The military pact of the Shanghai Treaty Organization (SCO) also follows the same softly worded format. It is also worth noting that Article 12 of the 2001 Sino-Russian bilateral treaty stipulates that China and Russia will work together to maintain the global strategic balance, “observation of the basic agreements relevant to the safeguard and maintenance of strategic stability,” and “promote the process of nuclear disarmament.” [2] This seems to be an insinuation about a nuclear threat posed from the United States.
Standing in the Way of America and Britain: A “Chinese-Russian-Iranian Coalition”
As a result of the Anglo-American drive to encircle and ultimately dismantle China and Russia, Moscow and Beijing have joined ranks and the SCO has slowly evolved and emerged in the heart of Eurasia as a powerful international body.
The main objectives of the SCO are defensive in nature. The economic objectives of the SCO are to integrate and unite Eurasian economies against the economic and financial onslaught and manipulation from the “Trilateral” of North America, Western Europe, and Japan, which controls significant portions of the global economy.
The SCO charter was also created, using Western national security jargon, to combat “terrorism, separatism, and extremism.” Terrorist activities, separatist movements, and extremist movements in Russia, China, and Central Asia are all forces traditionally nurtured, funded, armed, and covertly supported by the British and the U.S. governments. Several separatist and extremist groups that have destabilized SCO members even have offices in London.
Iran, India, Pakistan, and Mongolia are all SCO observer members. The observer status of Iran in the SCO is misleading. Iran is a de facto member. The observer status is intended to hide the nature of trilateral cooperation between Iran, Russia, and China so that the SCO cannot be labeled and demonized as an anti-American or anti-Western military grouping.
The stated interests of China and Russia are to ensure the continuity of a “Multi-Polar World.” Zbigniew Brzezinski prefigured in his 1997 book The Grand Chessboard: American Primacy and the Geostrategic Imperatives and warned against the creation or “emergence of a hostile [Eurasian-based] coalition that could eventually seek to challenge America’s primacy.” [3] He also called this potential Eurasian coalition an “‘antihegemonic’ alliance” that would be formed from a “Chinese-Russian-Iranian coalition” with China as its linchpin. [4] This is the SCO and several Eurasian groups that are connected to the SCO.
In 1993, Brzezinski wrote “In assessing China’s future options, one has to consider also the possibility that an economically successful and politically self-confident China — but one which feels excluded from the global system and which decides to become both the advocate and the leader of the deprived states of the world — may decide to pose not only an articulate doctrinal but also a powerful geopolitical challenge to the dominant trilateral world [a reference to the economic front formed by North America, Western Europe, and Japan].” [5]
Brzezinski warns that Beijing’s answer to challenging the global status quo would be the creation of a Chinese-Russian-Iranian coalition: “For Chinese strategists, confronting the trilateral coalition of America and Europe and Japan, the most effective geopolitical counter might well be to try and fashion a triple alliance of its own, linking China with Iran in the Persian Gulf/Middle East region and with Russia in the area of the former Soviet Union [and Eastern Europe].” [6] Brzezinski goes on to say that the Chinese-Russian-Iranian coalition, which he moreover calls an “antiestablishmentarian [anti-establishmentarian] coalition,” could be a potent magnet for other states [e.g., Venezuela] dissatisfied with the [global] status quo.” [7]
Furthermore, Brzezinski warned in 1997 that “The most immediate task [for the U.S.] is to make certain that no state or combination of states gains the capacity to expel the United States from Eurasia or even to diminish significantly its decisive arbitration role.” [8] It may be that his warnings were forgotten, because the U.S. has been repealed from Central Asia and U.S. forces have been evicted from Uzbekistan and Tajikistan.
“Velvet Revolutions” Backfire in Central Asia
Central Asia was the scene of several British-sponsored and American-sponsored attempts at regime change. The latter were characterised by velvet revolutions similar to the Orange Revolution in Ukraine and the Rose Revolution in Georgia.
These velvet revolutions financed by the U.S. failed in Central Asia, aside from Kyrgyzstan where there had been partial success with the so-called Tulip Revolution.
As a result the U.S. government has suffered major geo-strategic setbacks in Central Asia. All of Central Asia’s leaders have distanced themselves from America.
Russia and Iran have also secured energy deals in the region. America’s efforts, over several decades, to exert a hegemonic role in Central Asia seem to have been reversed overnight. The U.S. sponsored velvet revolutions have backfired. Relations between Uzbekistan and the U.S. were especially hard hit.
Uzbekistan is under the authoritarian rule of President Islam Karamov. Starting in the second half of the 1990s President Karamov was enticed into bringing Uzbekistan into the fold of the Anglo-American alliance and NATO. When there was an attempt on President Karamov’s life, he suspected the Kremlin because of his independent policy stance. This is what led Uzbekistan to leave CSTO. But Islam Karamov, years later, changed his mind as to who was attempting to get rid of him.
According to Zbigniew Brzezinski, Uzbekistan represented a major obstacle to any renewed Russian control of Central Asia and was virtually invulnerable to Russian pressure; this is why it was important to secure Uzbekistan as an American protectorate in Central Asia.
Uzbekistan also has the largest military force in Central Asia. In 1998, Uzbekistan held war games with NATO troops in Uzbekistan. Uzbekistan was becoming heavily militarized in the same manner as Georgia was in the Caucasus. The U.S. gave Uzbekistan huge amounts of financial aid to challenge the Kremlin in Central Asia and also provided training to Uzbek forces.
With the launching of the “Global War on Terror,” in 2001, Uzbekistan, an Anglo-American ally, immediately offered bases and military facilities to the U.S. in Karshi-Khanabad.
The leadership of Uzbekistan already knew the direction the “Global War on Terror” would take. To the irritation of the Bush Jr. Administration, the Uzbek President formulated a policy of self-reliance. The honeymoon between Uzbekistan and the Anglo-American alliance ended when Washington, D.C. and London contemplated removing Islam Karamov from power. He was a little too independent for their comfort and taste. Their attempts at removing the Uzbek President failed, leading eventually to a shift in geo-political alliances.
The tragic events of Andijan on May 13, 2005 were the breaking point between Uzbekistan and the Anglo-American alliance. The people of Andijan were incited into confronting the Uzbek authorities, which resulted in a heavy security clampdown on the protesters and a loss of lives.
Armed groups were reported to have been involved. In the U.S., Britain, and the E.U., the media reports focused narrowly on human rights violations without mentioning the covert role of the Anglo-American alliance. Uzbekistan held Britain and the U.S. responsible accusing them of inciting rebellion.
M. K. Bhadrakumar, the former Indian ambassador to Uzbekistan (1995-1998), revealed that the Hezbut Tahrir (HT) was one of the parties blamed for stirring the crowd in Andijan by the Uzbek government. [9] The group was already destabilizing Uzbekistan and using violent tactics. The headquarters of this group happens to be in London and they enjoy the support of the British government. London is a hub for many similar organizations that further Anglo-American interests in various countries, including Iran and Sudan, through destabilization campaigns. Uzbekistan even started clamping down on foreign non-governmental organizations (NGOs) because of the tragic events of Andijan.
The Anglo-American alliance had played its cards wrong in Central Asia. Uzbekistan officially left the GUUAM Group, a NATO-U.S. sponsored anti-Russian body. GUUAM once again became the GUAM (Georgia, Ukraine, Azerbaijan and Moldava) Group on May 24, 2005.
On July 29, 2005 the U.S. military was ordered to leave Uzbekistan within a six-month period. [10] Literally, the Americans were told they were no longer welcome in Uzbekistan and Central Asia.
Russia, China, and the SCO added their voices to the demands. The U.S. cleared its airbase in Uzbekistan by November, 2005.
Uzbekistan rejoined the CSTO alliance on June 26, 2006 and realigned itself, once again, with Moscow. The Uzbek President also became a vocal advocate, along with Iran, for pushing the U.S. totally out of Central Asia. [11] Unlike Uzbekistan, Kyrgyzstan continued to allow the U.S. to use Manas Air Base, but with restrictions and in an uncertain atmosphere. The Kyrgyz government also would make it clear that no U.S. operations could target Iran from Kyrgyzstan.
Major Geo-Strategic Error
It appears that a strategic rapprochement between Iran and America was in the works from 2001 to 2002. At the outset of the global war on terrorism, Hezbollah and Hamas, two Arab organizations supported by Iran and Syria, were kept off the U.S. State Department’s list of terrorist organizations. Iran and Syria were also loosely portrayed as potential partners in the “Global War on Terror.”
Following the 2003 invasion of Iraq, Iran expressed its support for the post-Saddam Hussein Iraqi government. During the invasion of Iraq, the American military even attacked the Iraqi-based Iranian opposition militia, the Mujahedin-e Khalq Organization (MEK/MOK/MKO). Iranian jets also attacked the Iraqi bases of the MEK in approximately the same window of time.
Iran, Britain, and the U.S. also worked together against the Taliban in Afghanistan. It is worth mentioning that the Taliban were never allies of Iran. Up until 2000, the Taliban had been supported by the U.S. and Britain, working hand in glove with the Pakistani military and intelligence.
The Taliban were shocked and bewildered at what they saw as an American and British betrayal in 2001 — this is in light of the fact that in October, 2001 they had stated that they would hand over Osama bin Laden to the U.S. upon the presentation of evidence of his alleged involvement in the 9/11 attacks.
Zbigniew Brzezinski warned years before 2001 that “a coalition allying Russia with both China and Iran can develop only if the United States is shortsighted enough to antagonize China and Iran simultaneously.” [12] The arrogance of the Bush Jr. Administration has resulted in this shortsighted policy.
According to The Washington Post, “Just after the lightning takeover of Baghdad by U.S. forces three years ago [in 2003], an unusual two-page document spewed out of a fax machine at the Near East bureau of the State Department. It was a proposal from Iran for a broad dialogue with the United States, and the fax suggested everything was on the table — including full cooperation on nuclear programs, acceptance of Israel and the termination of Iranian support for Palestinian militant groups.” [13]
The White House impressed by what they believe were “grand victories” in Iraq and Afghanistan merely ignored the letter sent through diplomatic channels by the Swiss government on behalf of Tehran.
However, it was not because of what was wrongly perceived as a quick victory in Iraq that the Bush Jr. Administration pushed Iran aside. On January 29, 2002, in a major address, President Bush Jr. confirmed that the U.S. would also target Iran, which had been added to the so-called “Axis of Evil” together with Iraq and North Korea. The U.S. and Britain intended to attack Iran, Syria, and Lebanon after the 2003 invasion of Iraq. In fact immediately following the invasion, in July 2003, the Pentagon formulated an initial war scenario entitled “Theater Iran Near Term (TIRANNT).”
Starting in 2002, the Bush Jr. Administration had deviated from their original geo-strategic script. France and Germany were also excluded from sharing the spoils of war in Iraq.
The intention was to act against Iran and Syria just as America and Britain had used and betrayed their Taliban allies in Afghanistan. The U.S. was also set on targeting Hezbollah and Hamas. In January of 2001, according to Daniel Sobelman, a correspondent for Haaretz, the U.S. government warned Lebanon that the U.S. would go after Hezbollah. These threats directed at Lebanon were made at the start of the presidential term of George W. Bush Jr., eight months before the events of September 11, 2001.
The conflict at the United Nations Security Council between the Anglo-American alliance and the Franco-German entente, supported by Russia and China, was a pictogram of this deviation.
American geo-strategists for years after the Cold War had scheduled the Franco-German entente to be partners in their plans for global primacy. In this regard, Zbigniew Brzezinski had acknowledged that the Franco-German entente would eventually have to be elevated in status and that the spoils of war would have to be divided with Washington’s European allies.
By the end of 2004, the Anglo-American alliance had started to correct its posture towards France and Germany. Washington had returned to its original geo-strategic script with NATO playing an expanded role in the Eastern Mediterranean. In turn, France was granted oil concessions in Iraq.
The 2006 war plans for Lebanon and the Eastern Mediterranean also point to a major shift in direction, a partnership role for the Franco-German entente, with France and Germany playing a major military role in the region.
It is worth noting that a major shift occurred in early 2007 with regard to Iran. Following U.S. setbacks in Iraq and Afghanistan (as well as in Lebanon, Palestine, Somalia, and former Soviet Central Asia), the White House entered into secret negotiatiations with Iran and Syria. However, the dye has been cast and it would appear that America will be unable to break an evolving military alliance which includes Russia, Iran, and China as its nucleus.
The Baker-Hamilton Commission: Covert Anglo-American Cooperation with Iran and Syria?
“America should also strongly support Turkish aspirations to have a pipeline from Baku in [the Republic of] Azerbaijan to Ceyhan on the Turkish Mediterranean cost serve as [a] major outlet for the Caspian Sea basin energy sources. In addition, it is not in America’s interest to perpetuate American-Iranian hostility. Any eventual reconciliation should be based on the recognition of a mutual strategic interest in stabilizing what currently is a very volatile regional environment for Iran [e.g., Iraq and Afghanistan]. Admittedly, any such reconciliation must be pursued by both sides and is not a favor granted by one to the other. A strong, even religiously motivated but not fanatically anti-Western Iran is in the U.S. interest, and ultimately even the Iranian political elite may recognize that reality. In the meantime, American long-range interests in Eurasia would be better served by abandoning existing U.S. objections to closer Turkish-Iranian economic cooperation, especially in the construction of new pipelines...”
-Zbigniew Brzezinski (The Grand Chessboard: American Primacy and Its Geostrategic Imperatives, 1997)
The recommendations of the Baker-Hamilton Commission or the Iraq Study Group (ISG) are not a redirection in regards to engaging Iran, but a return to the track that the Bush Jr. Administration had deviated from as a result of the delusions of its hasty victories in Afghanistan and Iraq. In other words, the Baker-Hamilton Commission was about damage control and re-steering America to the geo-strategic path originally intended by military planners that the Bush Jr. Administration seems to have deviated from.
The ISG Report also subtly indicated that adoption of so-called “free market” economic reforms be pressed on Iran (and by extension Syria) instead of regime change. The ISG also favoured the accession of both Syria and Iran to the World Trade Organization (WTO). [14] It should also be noted, in this regard, that Iran has already started a mass privatization program that involves all sectors from banking to energy and agriculture.
The ISG Report also recommends an end to the Arab-Israeli Conflict and the establishment of peace between Israel and Syria. [15]
The joint interests of Iran and the U.S. were also analysed by the Baker-Hamilton Commission. The ISG recommended that the U.S. should not empower the Taliban again in Afghanistan (against Iran). [16] It should also be noted that Imad Moustapha, the Syrian ambassador to the U.S., the Syrian Foreign Minister, and Javad Zarif, the Iranian representative to the United Nations, were all consulted by the Baker-Hamilton Commission. [17] The Iranian Ambassodor to the U.N., Javad Zarif, has also been a middle man between the U.S. and Iranian governments for years.
It is worth mentioning that the Clinton Administration was involved in the track of rapprochement with Iran, while also attempting to keep Iran in check under the “dual-containment” policy directed against Iraq and Iran. This policy was also linked to the 1992 Draft Defence Guidance paper written by people within the Bush Sr. and Bush Jr. Administrations.
It is worth noting that Zbigniew Brzezinski had stated as far back as 1979 and again in 1997 that Iran under its post-revolutionary political system could be co-opted by America. [18] Britain also ensured Syria and Iran in 2002 and 2003 that they would not be targeted and encouraged their cooperation with the White House.
It should be noted that Turkey has recently signed a pipeline deal with Iran that will take gas to Western Europe. This project includes the participation of Turkmenistan. [19] It would appear that this cooperation agreement between Tehran and Ankara points to reconciliation rather than confrontation with Iran and Syria. This is in line with what Brzezinski in 1997 claimed was in America’s interest.
Also, the Anglo-American sponsored Iraqi government has recently signed pipeline deals with Iran.
Once again, America’s interests in this deal should be questioned, as should the high opinions being given about Iran by the puppet leaders of Iraq and Afghanistan.
Something’s Amiss...
The media attention given in North America and Britain to the positive comments made about Tehran by Anglo-American clients in Baghdad and Kabul is sinister.
Although these comments from Baghdad and Kabul about the positive role Iran plays in Iraq and Afghanistan are not new, the media attention is. President George W. Bush Jr. and the White House criticized the Iraqi Prime Minister for saying Iran plays a constructive role in Iraq in early-August of 2007. The White House and North American or British press would usually just ignore or refuse to acknowledge these comments. However, this was not the case in August, 2007.
The Afghani President, Hamid Karzai, during a joint press conference with George W. Bush Jr. stated that Iran was a positive force in his country. It is not odd to hear that Iran is a positive force inside Afghanistan because the stability of Afghanistan is in Iran’s best interests. What comes across as odd are “when” and “where” the comments were made. White House press conferences are choreographed and the place and time of the Afghani President’s comments should be questioned. It also so happens that shortly after the Afghani President’s comments, the Iranian President arrived in Kabul in an unprecedented visit that must have been approved by the White House.
Iran’s Political Leverage
In regards to Iran and the U.S., the picture is blurry and the lines between cooperation and rivalry are less clear. Reuters and the Iranian Student’s News Agency (ISNA) have both reported that the Iranian President may visit Baghdad after August 2007. These reports surfaced just before the U.S. government started threatening to label the Iranian Revolutionary Guard Corps as a special international terrorist organization. Without insinuating anything, it should also be noted that the Revolutionary Guard and the U.S. military have also had a low-key history of cooperation from Bosnia-Herzegovina to Taliban-controlled Afghanistan.
The Iranian President has also invited the presidents of the other four Caspian states for a Caspian Sea summit in Tehran. [20] He invited the Turkmen president while in Turkmenistan and later the Russian and Kazakh presidents at the August of 2007 SCO summit in Kyrgyzstan. President Aliyev, the leader of the Republic of Azerbaijan (Azarbaijan) was also personally invited during a trip by the Iranian President to Baku. The anticipated Caspian Sea summit may be similar to the one in Port Turkmenbashi, Turkmenistan between the Kazakh, Russian, and Turkmen presidents where it was announced that Russia would not be cut out of the pipeline deals in Central Asia.
Iranian leverage is clearly getting stronger. Officials in Baku also stated that they will expand energy cooperation with Iran and enter the gas pipeline deal between Iran, Turkey, and Turkmenistan that will supply European markets with gas. [21] This agreement to supply Europe is similar to a Russian energy transport deal signed between Greece, Bulgaria, and the Russian Federation. [22]
In the Levant, Syria is involved in energy-related negotiations with Ankara and Baku and important talks have started between American officials and both Tehran and Damascus. [23]
Iran has also been involved in diplomatic exchanges with Syria, Lebanon, Turkey, and the Republic of Azerbaijan. Additionally, starting in August 2007, Syria has agreed to reopen Iraqi oil pipelines to the Eastern Mediterranean, through Syrian territory. [24] The recent official visit of Iraqi Prime Minister Al-Maliki to Syria has also been described as historical by news sources like the British Broadcasting Corporation (BBC). Also, Syria and Iraq have agreed to build a gas pipeline from Iraq into Syria, where Iraqi gas will be treated in Syrian plants. [25] These agreements are being passed as the sources of tensions between Baghdad and the White House, but they are doubtful. [26]
Iran and the Gulf Cooperation Council (GCC) are also planning on starting the process for creating an Iranian-GCC free trade zone in the Persian Gulf. In the bazaars of Tehran and amongst the political circle of Rafsanjani there are also discussions about the eventual creation of a single market between Iran, Tajikistan, Armenia, Iraq, Afghanistan, and Syria. The American role in these processes in regards to Afghanistan, Iraq, and the GCC should be explored.
Under President Nicholas Sarkozy, France has indicated that it is willing to engage the Syrians fully if they gave specific guarantees in regards to Lebanon. These guarantees are linked to French economic and geo-strategic interests.
In the same period of time as the French statements about Syria, Gordon Brown indicated that Britain was also willing to engage in diplomatic exchanges with both Syria and Iran. Heidemarie Wieczorek-Zeul, the German Minister of Economic Cooperation and Development, has also been involved in talks with Damascus on mutual projects, economic reform, and bringing Syria closer to the European Union. These talks, however tend to be camouflaged by the discussion between Syria and Germany in regards to the mass exodus of Iraqi refugees, resulting from the Anglo-American occupation of their country. The French Foreign Minister is also expected in Tehran to talk about Lebanon, Palestine, and Iraq. Despite the war-mongering by the U.S. and more recently by France, this has all led to speculation of a potential about-turn in regards to Iran and Syria. [27]
Then again, this is part of the two-pronged U.S. approach of preparing for the worst (war), while suing for the diplomatic capitulation of Syria and Iran as client states or partners. When large oil and weapons deals were signed between Libya and Britain, London said that Iran should follow the Libyan example, as has the Baker-Hamilton Commission.
Has the March to War been Interrupted?
Despite talks behind closed doors with Damascus and Tehran, Washington is nonetheless arming its clients in the Middle East. Israel is in an advanced state of military preparedness for a war on Syria.
Unlike France and Germany, Anglo-American ambitions pertaining to Iran and Syria are not one of cooperation. The ultimate objective is political and economic subordination.
Moreover, either as a friend or foe, America cannot tolerate Iran within its present borders. The balkanization of Iran, like that of Iraq and Russia, is a major long-term Anglo-American goal.
What lies ahead is never known. While there is smoke in the horizon, the U.S.-NATO-Israeli military agenda will not necessarily result in the implementation of war as planned.
A “Chinese-Russian-Iranian coalition” — which forms the basis of a global counter-alliance — is emerging. America and Britain rather than opting for outright war, may choose to reel in Iran and Syria through macro-economic manipulation and velvet revolutions.
War directed against Iran and Syria, however, cannot be ruled out. There are real war preparations on the ground in the Middle East and Central Asia. A war against Iran and Syria would have far-reaching worldwide implications.
Saturday, August 25, 2007
USA superpower in Decline
a very nice article u should read.
The Sole Superpower in Decline
The Rise of a Multipolar World
By Dilip HiroWith the collapse of the Soviet Union in 1991, the United States stood tall -- militarily invincible, economically unrivalled, diplomatically uncontestable, and the dominating force on information channels worldwide. The next century was to be the true "American century," with the rest of the world molding itself in the image of the sole superpower.
Yet, with not even a decade of this century behind us, we are already witnessing the rise of a multipolar world in which new powers are challenging different aspects of American supremacy -- Russia and China in the forefront, with regional powers Venezuela and Iran forming the second rank. These emergent powers are primed to erode American hegemony, not confront it, singly or jointly.
How and why has the world evolved in this way so soon? The Bush administration's debacle in Iraq is certainly a major factor in this transformation, a classic example of an imperialist power, brimming with hubris, over-extending itself. To the relief of many -- in the U. S. and elsewhere -- the Iraq fiasco has demonstrated the striking limitations of power for the globe's highest-tech, most destructive military machine. In Iraq, Brent Scowcroft, national security adviser to two U.S. presidents, concedes in a recent op-ed, "We are being wrestled to a draw by opponents who are not even an organized state adversary."
The invasion and subsequent disastrous occupation of Iraq and the mismanaged military campaign in Afghanistan have crippled the credibility of the United States. The scandals at Abu Ghraib prison in Iraq and Guantanamo in Cuba, along with the widely publicized murders of Iraqi civilians in Haditha, have badly tarnished America's moral self-image. In the latest opinion poll, even in a secular state and member of NATO like Turkey, only 9% of Turks have a "favorable view" of the U.S. (down from 52% just five years ago).
Yet there are other explanations -- unrelated to Washington's glaring misadventures -- for the current transformation in international affairs. These include, above all, the tightening market in oil and natural gas, which has enhanced the power of hydrocarbon-rich nations as never before; the rapid economic expansion of the mega-nations China and India; the transformation of China into the globe's leading manufacturing base; and the end of the Anglo-American duopoly in international television news.
Many Channels, Diverse Perceptions
During the 1991 Gulf War, only CNN and the BBC had correspondents in Baghdad. So the international TV audience, irrespective of its location, saw the conflict through their lenses. Twelve years later, when the Bush administration, backed by British Prime Minister Tony Blair, invaded Iraq, Al Jazeera Arabic broke this duopoly. It relayed images -- and facts -- that contradicted the Pentagon's presentation. For the first time in history, the world witnessed two versions of an ongoing war in real time. So credible was the Al Jazeera Arabic version that many television companies outside the Arabic-speaking world -- in Europe, Asia and Latin America -- showed its clips.
Though, in theory, the growth of cable television worldwide raised the prospect of ending the Anglo-American duopoly in 24-hour TV news, not much had happened due to the exorbitant cost of gathering and editing TV news. It was only the arrival of Al Jazeera English, funded by the hydrocarbon-rich emirate of Qatar -- with its declared policy of offering a global perspective from an Arab and Muslim angle -- that, in 2006, finally broke the long-established mold.
Soon France 24 came on the air, broadcasting in English and French from a French viewpoint, followed in mid-2007 by the English-language Press TV, which aimed to provide an Iranian perspective. Russia was next in line for 24-hour TV news in English for the global audience. Meanwhile, spurred by Venezuelan President Hugo Chavez, Telesur, a pan-Latin-American TV channel based in Caracas, began competing with CNN in Spanish for a mass audience.
As with Qatar, so with Russia and Venezuela, the funding for these TV news ventures has come from soaring national hydrocarbon incomes -- a factor draining American hegemony not just in imagery but in reality.
Russia, an Energy Superpower
Under President Vladimir Putin, Russia has more than recovered from the economic chaos that followed the collapse of the Soviet Union in 1991. After effectively renationalizing the energy industry through state-controlled corporations, he began deploying its economic clout to further Russia's foreign policy interests.
In 2005, Russia overtook the United States, becoming the second largest oil producer in the world. Its oil income now amounts to $679 million a day. European countries dependent on imported Russian oil now include Hungary, Poland, Germany, and even Britain.
Russia is also the largest producer of natural gas on the planet, with three-fifths of its gas exports going to the 27-member European Union (EU). Bulgaria, Estonia, Finland, and Slovakia get 100% of their natural gas from Russia; Turkey, 66%; Poland, 58%; Germany 41%; and France 25%. Gazprom, the biggest natural gas enterprise on Earth, has established stakes in sixteen EU countries. In 2006, the Kremlin's foreign reserves stood at $315 billion, up from a paltry $12 billion in 1999. Little wonder that, in July 2006 on the eve of the G8 summit in St Petersburg, Putin rejected an energy charter proposed by the Western leaders.
Soaring foreign-exchange reserves, new ballistic missiles, and closer links with a prospering China -- with which it conducted joint military exercises on China's Shandong Peninsula in August 2005 -- enabled Putin to deal with his American counterpart, President George W. Bush, as an equal, not mincing his words when appraising American policies.
"One country, the United States, has overstepped its national boundaries in every way," Putin told the 43rd Munich Trans-Atlantic conference on security policy in February 2007. "This is visible in the economic, political, cultural and educational policies it imposes on other nations…This is very dangerous."
Condemning the concept of a "unipolar world," he added: "However one might embellish this term, at the end of the day it describes a scenario in which there is one center of authority, one center of force, one center of decision-making…It is a world in which there is one master, one sovereign. And this is pernicious." His views fell on receptive ears in the capitals of most Asian, African, and Latin American countries.
The changing relationship between Moscow and Washington was noted, among others, by analysts and policy-makers in the hydrocarbon-rich Persian Gulf region. Commenting on the visit that Putin paid to long-time U.S. allies Saudi Arabia and Qatar after the Munich conference, Abdel Aziz Sagar, chairman of the Gulf Research Center, wrote in the Doha-based newspaper The Peninsula that Russia and Gulf Arab countries, once rivals from opposite ideological camps, had found a common agenda of oil, anti-terrorism, and arms sales. "The altered focus takes place in a milieu where the Gulf countries are signaling their keenness to keep all geopolitical options open, reviewing the utility of the United States as the sole security guarantor, and contemplating a collective security mechanism that involves a host of international players."
In April 2007, the Kremlin issued a major foreign policy document. "The myth about the unipolar world fell apart once and for all in Iraq," it stated. "A strong, more self-confident Russia has become an integral part of positive changes in the world."
The Kremlin's increasingly tense relations with Washington were in tune with Russian popular opinion. A poll taken during the run-up to the 2006 G8 summit revealed that 58% of Russians regarded America as an "unfriendly country." It has proved to be a trend. This July, for instance, Major Gen Alexandr Vladimirov told the mass circulation newspaper Komsolskya Pravada that war with the United States was a "possibility" in the next ten to fifteen years.
Chavez Rides High
Such sentiments resonated with Hugo Chavez. While visiting Moscow in June 2007, he urged Russians to return to the ideas of Vladimir Lenin, especially his anti-imperialism. "The Americans don't want Russia to keep rising," he said. "But Russia has risen again as a center of power, and we, the people of the world, need Russia to become stronger."
Chavez finalized a $1 billion deal to purchase five diesel submarines to defend Venezuela's oil-rich undersea shelf and thwart any possible future economic embargo imposed by Washington. By then, Venezuela had become the second largest buyer of Russian weaponry. (Algeria topped the list, another indication of a growing multipolarity in world affairs.) Venezuela acquired the distinction of being the first country to receive a license from Russia to manufacture the famed AK-47 assault rifle.
By channeling some of his country's oil money to needy Venezuelans, Chavez broadened his base of support. Much to the chagrin of the Bush White House, he trounced his sole political rival, Manuel Rosales, in a December 2006 presidential contest with 61% of the vote. Equally humiliating to the Bush administration, Venezuela was, by then, giving more foreign aid to needy Latin American states than it was.
Following his reelection, Chavez vigorously pursued the concept of forming an anti-imperialist alliance in Latin America as well as globally. He strengthened Venezuela's ties not only with such Latin countries as Bolivia, Cuba, Ecuador, Nicaragua, and debt-ridden Argentina, but also with Iran and Belarus.
By the time he arrived in Tehran from Moscow (via Minsk) in June 2007, the 180 economic and political accords his government had signed with Tehran were already yielding tangible results. Iranian-designed cars and tractors were coming off assembly lines in Venezuela. "[The] cooperation of independent countries like Iran and Venezuela has an effective role in defeating the policies of imperialism and saving nations," Chavez declared in Tehran.
Stuck in the quagmire of Iraq and lashed by the gusty winds of rocketing oil prices, the Bush administration finds its area of maneuver woefully limited when dealing with a rising hydrocarbon power. To the insults that Chavez keeps hurling at Bush, the American response has been vapid. The reason is the crippling dependence of the United States on imported petroleum which accounts for 60% of its total consumed. Venezuela is the fourth largest source of U.S. imported oil after Canada, Mexico, and Saudi Arabia; and some refineries in the U.S. are designed specifically to refine heavy Venezuelan oil.
In Chavez's scheme to undermine the "sole superpower," China has an important role. During an August 2006 visit to Beijing, his fourth in seven years, he announced that Venezuela would triple its oil exports to China to 500,000 barrels per day in three years, a jump that suited both sides. Chavez wants to diversify Venezuela's buyer base to reduce its reliance on exports to the U.S., and China's leaders are keen to diversify their hydrocarbon imports away from the Middle East, where American influence remains strong.
"The support of China is very important [to us] from the political and moral point of view," Chavez declared. Along with a joint refinery project, China agreed to build thirteen oil drilling platforms, supply eighteen oil tankers, and collaborate with the state-owned company, Petroleos de Venezuela S.A. (PdVSA), in exploring a new oilfield in the Orinoco Basin.
China on a Stratospheric Trajectory
So dramatic has been the growth of the state-run company PetroChina that, in mid-2007, it was second only to Exxon Mobil in its market value among energy corporations. Indeed, that year three Chinese companies made it onto the list of the world's ten most highly valued corporations. Only the U.S. had more with five. China's foreign reserves of over $1 trillion have now surpassed Japan's. With its gross domestic product soaring past Germany's, China ranks number three in the world economy.
In the diplomatic arena, Chinese leaders broke new ground in 1996 by sponsoring the Shanghai Cooperation Organization (SCO), consisting of four adjoining countries: Russia and the three former Soviet Socialist republics of Kazakhstan, Kyrgyzstan, and Tajikistan. The SCO started as a cooperative organization with a focus on countering drug-smuggling and terrorism. Later, the SCO invited Uzbekistan to join, even though it does not abut China. In 2003, the SCO broadened its scope by including regional economic cooperation in its charter. That, in turn, led it to grant observer status to Pakistan, India, and Mongolia -- all adjoining China -- and Iran which does not. When the U.S. applied for observer status, it was rejected, an embarrassing setback for Washington, which enjoyed such status at the Association of South-East Asian Nations (ASEAN).
In early August 2007, on the eve of an SCO summit in the Kyrgyz capital of Bishkek, the group conducted its first joint military exercises, codenamed Peace Mission 2007, in the Russian Ural region of Chelyabinsk. "The SCO is destined to play a vital role in ensuring international security," said Ednan Karabayev, foreign minister of Kyrgyzstan.
In late 2006, as the host of a China-Africa Forum in Beijing attended by leaders of 48 of 53 African nations, China left the U.S. woefully behind in the diplomatic race for that continent (and its hydrocarbon and other resources). In return for Africa's oil, iron ore, copper, and cotton, China sold low-priced goods to Africans, and assisted African counties in building or improving roads, railways, ports, hydro-electric dams, telecommunications systems, and schools. "The western approach of imposing its values and political system on other countries is not acceptable to China," said Africa specialist Wang Hongyi of the China Institute of International Studies. "We focus on mutual development."
To reduce the cost of transporting petroleum from Africa and the Middle East, China began constructing a trans-Burma oil pipeline from the Bay of Bengal to its southern province of Yunan, thereby shortening the delivery distance now traveled by tankers. This undermined Washington's campaign to isolate Myanmar. (Earlier, Sudan, boycotted by Washington, had emerged as a leading supplier of African oil to China.) In addition, Chinese oil companies were competing fiercely with their Western counterparts in getting access to hydrocarbon reserves in Kazakhstan and Uzbekistan.
"China's oil diplomacy is putting the country on a collision course with the U.S. and Western Europe, which have imposed sanctions on some of the countries where China is doing business," comments William Mellor of Bloomberg News. The sentiment is echoed by the other side. "I see China and the U.S. coming into conflict over energy in the years ahead," says Jin Riguang, an oil-and-gas advisor to the Chinese government and a member of the Standing Committee of the Chinese People's Political Consultative Council.
China's industrialization and modernization has spurred the modernization of its military as well. The test-firing of the country's first anti-satellite missile, which successfully destroyed a defunct Chinese weather satellite in January 2007, dramatically demonstrated its growing technological prowess. An alarmed Washington had already noted an 18% increase in China's 2007 defense budget. Attributing the rise to extra spending on missiles, electronic warfare, and other high-tech items, Liao Xilong, commander of the People's Liberation Army's general logistics department, said: "The present day world is no longer peaceful and to protect national security, stability and territorial integrity we must suitably increase spending on military modernization."
China's declared budget of $45 billion was a tiny fraction of the Pentagon's $459 billion one. Yet, in May 2007, a Pentagon report noted China's "rapid rise as a regional and economic power with global aspirations" and claimed that it was planning to project military farther afield from the Taiwan Straits into the Asia-Pacific region in preparation for possible conflicts over territory or resources.
The Sole Superpower in the Sweep of History
This disparate challenge to American global primacy stems as much from sharpening conflicts over natural resources, particularly oil and natural gas, as from ideological differences over democracy, American style, or human rights, as conceived and promoted by Western policy-makers. Perceptions about national (and imperial) identity and history are at stake as well.
It is noteworthy that Russian officials applauding the swift rise of post-Soviet Russia refer fondly to the pre-Bolshevik Revolution era when, according to them, Tsarist Russia was a Great Power. Equally, Chinese leaders remain proud of their country's long imperial past as unique among nations.
When viewed globally and in the great stretch of history, the notion of American exceptionalism that drove the neoconservatives to proclaim the Project for the New American Century in the late 20th century -- adopted so wholeheartedly by the Bush administration in this one -- is nothing new. Other superpowers have been there before and they, too, have witnessed the loss of their prime position to rising powers.
No superpower in modern times has maintained its supremacy for more than several generations. And, however exceptional its leaders may have thought themselves, the United States, already clearly past its zenith, has no chance of becoming an exception to this age-old pattern of history.
Sunday, August 12, 2007
China is US Banker
A very interesting article I found, CHINA not Federal Reserve is USA Banker and the one that borrow billions of Dollars for W. Bush Oil Wars
HERE is the article:
Early this morning China let the idiots in Washington, and on Wall Street, know that it has them by the short hairs. Two senior spokesmen for the Chinese government observed that China’s considerable holdings of US dollars and Treasury bonds “contributes a great deal to maintaining the position of the dollar as a reserve currency.”
HERE is the article:
Early this morning China let the idiots in Washington, and on Wall Street, know that it has them by the short hairs. Two senior spokesmen for the Chinese government observed that China’s considerable holdings of US dollars and Treasury bonds “contributes a great deal to maintaining the position of the dollar as a reserve currency.”
Should the US proceed with sanctions intended to cause the Chinese currency to appreciate, “the Chinese central bank will be forced to sell dollars, which might lead to a mass depreciation of the dollar.”
If Western financial markets are sufficiently intelligent to comprehend the message, US interest rates will rise regardless of any further action by China. At this point, China does not need to sell a single bond. In an instant, China has made it clear that US interest rates depend on China, not on the Federal Reserve.
The precarious position of the US dollar as reserve currency has been thoroughly ignored and denied. The delusion that the US is “the world’s sole superpower,” whose currency is desirable regardless of its excess supply, reflects American hubris, not reality. This hubris is so extreme that only 6 weeks ago McKinsey Global Institute published a study that concluded that even a doubling of the US current account deficit to $1.6 trillion would pose no problem.
Strategic thinkers, if any remain who have not been purged by neocons, will quickly conclude that China’s power over the value of the dollar and US interest rates also gives China power over US foreign policy. The US was able to attack Afghanistan and Iraq only because China provided the largest part of the financing for Bush’s wars.
If China ceased to buy US Treasuries, Bush’s wars would end. The savings rate of US consumers is essentially zero, and several million are afflicted with mortgages that they cannot afford. With Bush’s budget in deficit and with no room in the US consumer’s budget for a tax increase, Bush’s wars can only be financed by foreigners.
No country on earth, except for Israel, supports the Bush regimes’ desire to attack Iran. It is China’s decision whether it calls in the US ambassador, and delivers the message that there will be no attack on Iran or further war unless the US is prepared to buy back $900 billion in US Treasury bonds and other dollar assets.
The US, of course, has no foreign reserves with which to make the purchase. The impact of such a large sale on US interest rates would wreck the US economy and effectively end Bush’s war-making capability. Moreover, other governments would likely follow the Chinese lead, as the main support for the US dollar has been China’s willingness to accumulate them. If the largest holder dumped the dollar, other countries would dump dollars, too.
The value and purchasing power of the US dollar would fall. When hard-pressed Americans went to Wal-Mart to make their purchases, the new prices would make them think they had wandered into Nieman Marcus. Americans would not be able to maintain their current living standard.
Simultaneously, Americans would be hit either with tax increases in order to close a budget deficit that foreigners will no longer finance or with large cuts in income security programs. The only other source of budgetary finance would be for the government to print money to pay its bills. In this event, Americans would experience inflation in addition to higher prices from dollar devaluation.
This is a grim outlook. We got in this position because our leaders are ignorant fools. So are our economists, many of whom are paid shills for some interest group. So are our corporate leaders whose greed gave China power over the US by offshoring the US production of goods and services to China. It was the corporate fat cats who turned US Gross Domestic Product into Chinese imports, and it was the “free trade, free market economists” who egged it on.
How did a people as stupid as Americans get so full of hubris?
Wednesday, August 08, 2007
China Nuclear option vs Dollar
Washington is now in trouble since last year they started talking about trade sanctions against China cuz the Yuan hasnt been revaluated and now China has a retaliation option (nuclear) to attack the US Dollar with its massive Reserves nearly $1.3 trillion. This could be use as a bargain to reach an agreement and solve the problems, so now USA lost it's economic power and most of the US debt is in hands (44%) of Japan, China and many other countries.
China threatens 'nuclear option' of dollar sales
Monday, August 06, 2007
20 COUNTRIES OWN 94% OF OIL
The report states that 20 countries of the world own 94 percent of the hydrocarbon supply, totalling 1.4 trillion barrels. Out of that amount Azeri hydrocarbon supply totals 14 billion barrels (more than 1.9 billion tons).
According to the supply amount countries including
Monday, July 30, 2007
Dollar is Falling…very fast
An Empire is not forever… the greed accelerates their falling
USA is the country the highest debt in all the history of mankind, with a debt growing by $1.300 millions dollars a day
Weak point of USA empire is the DOLLAR ( Michael C. Ruppert).
Noam Chomsky: 9 of 10 dollars in the market are speculative and they don’t sustent on real wealth.
The fall of US Dollar is inminent, it is in their final days, the strategy of FED of printing and printing paper with no value is failing and impossible to avoid the break up, on 2007 US GDP only growth 0.0% and a inflation between 3 and 4% just because the high prices of Gas. Another sign of the inminent death is the Dollar Index a chart that shows how strongs is the dollar against other currencies, 100 is the best score now Dollars has a score of 83 when it reaches 80 the fall would occur…
USA style of Life of living from borrow money would be over, most of the world is not willing to continue giving money to a Death economy, the PetroDollar regime is also collapsing ‘cuz now Kuwait decided to stop using only dollars and diversify their currencies basket
4 countries (
The people that would suffer more is the middle classes of USA, ‘cuz their goverment is more focus on Big Multinationals so they pay less Taxes like JP Morgan and Goldman Sachs that are playing big big buck on fast investments and get HUGE return at the expenses of consumers, but the big winner of BUSH “play” is MILITARY INDUSTRIAL COMPLEX they have never get tons of money in all their history.
Another sign that Dollar is falling is the sky high prices of Gold, if Dollar falls these precious metal could reach $1000 dollars per ounce and silver $20.
| U.S. Dollar Value of Some Foreign Currencies | ||
| | June 1, 2002 | June 1, 2007 |
| EURO | 1.07 | 0.74 |
| JAPANESE YEN | 124.2 | 121.7 |
| BRITISH POUND | 0.68 | 0.50 |
| The Euro Surpasses the Dollar | ||
| DATE | EURO | DOLLAR |
| December 2003 | 354.5 | 584.3 |
| December 2004 | 501.3 | 564.2 |
| December 2005 | 565.2 | 668.0 |
| December 2006 | 628.2 | 618.9 |
| March 2007 | 608.5 | 571.0 |
The Fall of the empire could be by this 3 signs:
US Mega Debt
And the end of the Dollar hegemony
It’s Official: The Crash of the U.S. Economy has begun
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