Unless The Neocons Exceed Their Known Capacity For Stupidity|
[Imagine a map of the world. Since imagination is free, let's go all out. Imagine a three dimensional, animated hologram ? pulsing with luminous color, alive with visible flows of capital, personnel, petroleum, gas, commodities, opium, and arms. Now add a red flow of debt. The more detailed the map becomes, the more it resembles a medical image of a cancer-afflicted body. The United States is not an extrinsic infection like a bacterium or a virus; it's a legitimate part of the world system, gone bad through runaway growth unfunded by real nutrition, willing to cannibalize the system's own hard-won energies, unwilling to distinguish between its own short term profit and the greater good that includes its own long-term survival. There's "a cancer on the presidency," sure enough, but that's just a symptom, just one metastatic outpost of the big systemic disease. Obedience to dollar hegemony (i.e., bloodflow to the tumor) is yielding ever-diminishing returns for the rest of the world, and this is driving the Iranian crisis.
If that's too fancy, here's the simple version: back the dollar with gold, and it's a solid currency. Back the dollar with a solid manufacturing economy, and it's a stable currency. Back the dollar with petroleum trading and military force, and you're o.k. ? so long as you've got enough military force to prevent oil-rich countries from selling their oil outside the dollar. Because if that happens, then the dollar is backed with nothing but propaganda and it will collapse.
That could be brought about in several different ways, alone or in combination. A plunge in the dollar would hurt the rest of the world, especially China, whose goods are sold here in profusion. If the Chinese develop their own domestic market for their exports, China will no longer need to sponsor American debt so that American consumers can buy Chinese products with crypto-Chinese money. It will be a long time (if ever, given the realities of Peak Oil and Gas) before the general population of the Middle Kingdom has enough Yuan in its pocket to buy what it manufactures. But if China and her allies and dependents are sufficiently threatened by American imperial behavior, it will make sense for them to injure the dollar much sooner. That is to say, the higher America's level of risk-prone insanity, the sooner it will be reasonable for the rest of the world to sacrifice its own short-term economic interests in exchange for long-term freedom and security.
It's like 1971. In that year, U.S. domestic oil production peaked just as the dollar standard was moved from gold to Saudi oil under the strain of runaway military spending in a heroin-soaked quagmire. Today, there is the same military sinkhole (with the dope coming from Afghanistan's Golden Crescent instead of Vietnam's Golden Triangle), the same peak energy pattern (with the Peak in both Oil and Gas, this time at the planetary level), the same sudden need for a new foundation under America's inflationary currency (if you can find a new one, let us know - we also want a new place to move domestic debt now that the dotcom bubble has been drained into the housing bubble, now being drained into default).
Iran will open a euro-denominated oil trading bourse this March if the U.S. (perhaps via Israel) does not attack it. But if the U.S. does attack Iran in an attempt to prevent this, the rest of the world will dump the dollar to reign in American aggression. Remember that 3-D medical graphic with the tumor in the middle? If you listen hard enough, through the anesthesia of the Golden Globe Awards you can just about discern Doctor Thermodynamics turning to Nurse Dialectic and saying "scalpel." -JAH]
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