Mohd Amir Anwar
Most of the advanced western world is reeling with the worst economic crisis since World War II. The collapse of Greece, Ireland and recently Portugal has increased pressure on the Euro area to secure a far reaching solution that could hold on to its integrity. With Spain likely to default in the near future, the EU is on the brink of final collapse. The solution is least likely to come from within the Euro area as all the countries within EU are facing the heat of such calamitous capitalist crisis. The cost of this crisis has already touched nearly 300 billion Euros with Portugal needing nearly 80 billion now. Financing the already strained social services and banking system in Europe cannot be met by simply enhancing the European Central Bank’s bailout funds and besides that Euro powerhouse Germany cannot alone afford to balance this out. EU needs some sort of external passage to finance this. This ‘outside’ is provided by the ‘Arab revolution’. Wait a minute, am I insane?
Not really! America did solve its credit problem in the 1980s through ‘petrodollars’ that were recycled from Arab monarchs via banks in New York. In effect it had access to billions of dollars to be further loaned out at profitable rates to developing countries through IMF and World Bank. How America did it is a story of further interest and has been highly debated among both the advocates of conspiracy theory and those who denounce it. But we now know through British Intelligence that America was prepared to attack the Arab world in the early 70s with the rise in oil prices. America at that time depended upon oil imports from Middle East to sustain its growing consumerist economy. Its conservative ideology of ‘American national interests’ forced it to take any necessary step to keep its economic hegemony intact. It has since then banked upon its supreme military might to ensure a constantly open and fluid market prospects especially from the oil rich region of the Middle East. Robert Fisk once remarked that America and its Western Allies have got more men in Middle East than Crusaders had in 12th and 13th century.
Even though many would still argue that invasion of Iraq in 2003 was not a part of the programme to sustain a possible long term supply of oil to advanced western countries which was threatened when Saddam nationalised the oil industry. The evidences from the intelligence services in UK with which the British Government went to war in Iraq are still investigated and Mr. Blair is currently facing the trial. No matter what were the outcomes of that war; at present even after ten years of occupation, one thing that clearly sits in place is the smooth operation of oil companies from both America and Britain in Iraq. The restructuring of the Iraqi economy was done according to Washington Consensus which basically means privatisation and deregulation of the economy. The only sector which was left out was obviously oil sector. David Harvey, one of the leading Marxist geographers brilliantly illuminated these points in more details in his excellent book ‘The New Imperialism’. For those who still don’t believe this argument must read The Independent’s recent article about British oil firms which lobbied the government to engage alongside America in Iraq during early 2003.
The Iraq occupation according to Joseph Stiglitz and Linda Bilmes costs somewhere around three trillion dollars, what it ensures at the same time that these countries will have assured supply of oil in the periods of crisis. Yet the war which is by now costing somewhere around several trillion dollars for both UK and US, cannot be funded too long as the advanced capitalist countries are reeling in sub-prime mortgage crises one of the worst since World War II. Even some of the structural adjustment done by the national economies of the European countries by cutting the government spending, slashing the wage rates and restructuring the debts and interest rates, it is still facing impending crises where Greece is further likely to default in coming years when the interest rates on German bonds is raised to 11 percent. A similar situation has appeared in the Republic of Ireland where its banking system is strained to an extent that it needed another US $ 24 billion more in addition to US $ 85 billion from EU and IMF.
The best chance of financing these crises is also rather unlikely, in my perspective, from within the EU or American support because it is having a budget deficit at US $ 1.5 trillion which is around 10 percent of its GDP. EU has to find some external source of financing this deficit. In this regard, Libya is perhaps the best possible option for the EU to look upon. It is one of the world’s leading producers of oil – seventeenth on that list, while tenth largest proven reserves in the world. Any threat to this big oil depot would be detrimental to, most importantly, the EU which by far remains closest partner to Libya. EU continues to be Libya’s most important trading partner with nearly 60 percent of Libyan exports is for EU bulk of which constitutes ‘oil’ of course. There had been number of efforts by US and EU to sort out relationship with Libya both on economic and political terms. Libya agreed to pay compensation to Pan Am flight and UT flight bombings and George Bush signed executive order to restore Libya’s immunity from terror-related lawsuits and dismissing pending compensation cases. In 2008 Foreign Commonwealth Office signed five agreements with Libya to strengthen its ties with EU.
Moreover America along side UK is sitting on the oil fields in Saudi Arabia and Iraq, and it is highly likely that EU has to get its nose in somewhere America is neither willing to intervene nor it can afford to do so. Arab revolution in this regard destabilises the regime of Muammar Gaddafi, the Libyan leader who had held the power in Libya for almost 40 years thanks for the initial support from the US government who thought at time that he is an anti-Marxist which suited US economic and foreign policy at that time. Any revolution that overthrows the already existing autocratic dictator would be suppressed. He widely made a statement that he would give away contract of oil fields to BRIC countries which means that the supply of oil will be cut off and most importantly the source of oil revenue will be blocked which will further hit the financial meltdown in Europe.
Current military ‘invasion’ (I use the term ‘invasion’ rather than ‘intervention’ because in war its hard to differentiate between these two and besides that intervention to me is more diplomatic than invasion. My emphasis on this type of usage comes from Robert Fisk, who constantly argue that usage of words such as Israeli ‘occupation’ or ‘colonies’ in West Bank becomes ‘settlements’, ‘wall’ becomes a ‘fence’ or ‘security barrier’ ‘an increase in violence becomes a spike in violence, when ‘reinforcements’ becomes surge in army presence and so on, ‘isn’t just about clichés – this is preposterous journalism’) in Libya does two very important thing in a slow and silent manner. First it puts increasing pressure on Gaddafi to step down and seize its assets and be tried in the international court of justice. However, even if it did not succeed in doing so it will destroy the entire military capacity of the Libyan army. It is also certainly going to demolish the already strained social infrastructural facilities in Libyan cities. We have been hearing the news reporters from Libya doing an extremely risky job to send us news from the Libyan cities. We have reports of people dying every singly day and out constant focus is on humanitarian crises going on in Libya. Almost in the entirety of the reporting, leaving few reports which state that NATO’s bombs have killed civilians, there are hundred of human deaths most of them by Gaddafi forces. This to in the scenario when in the initial week of bombing NATO said that almost a third of Gaddafi’s military capacity have been destroyed. Something hard to believe how is that possible and moreover as if the bombs and Tomahawk missiles from NATO have got sensors to detect between civilians and pro-Gaddafi forces.
However in several weeks of bombing the outcome has not been favourable to NATO forces. They have realised that this is very difficult to avoid civilian casualties and it cannot be avoided so they have resorted to indirect invasion. They are deploying ground forces, although NATO maintain it is in the interests of the protection of the civilians and hence within the UN mandate. Britain, France and Italy are sending Special Forces to Libya to train rebels who are less well organised. What they will do in fact in a more sophisticated way is to send reports from the ground back to their military bases in Europe about military movements of Gaddafi forces.
NATO’s intensified operation in Libya suggest it is determined to get Gaddafi out and as a historical narratives before get a man in power which supports their ideology, most recently French and UN invasion in Ivory Coast to get socialist Gbagbo out and install IMF economist Ouattara. Once this aim has been achieved in Libya it will start the re-development of Libya pretty much in line with Iraq and oil revenues will be invested in Europe which can at least avoid short term financial crises or help stave of further debt problems of Europe. The details of this development programme for Libya will a subject of further consideration and scrutiny when the economists in EU and IMF meet in Brussels or London to decide the future of Libya. It will, I suppose, give enough time to the economies in Europe to restructure themselves to withstand another onslaught of crises in capitalism. Now when we think about this geopolitics around Black Gold, it becomes very reasonable to argue that Arab revolution which spreads across the Middle East in many countries witness military invasion in Libya and not in Egypt, Syria, Bahrain and Yemen. Had this commodity been potatoes or cabbage in Libya ,to quote Patrick Cockburn, and asparagus, to quote Harvey, who would have given it a damn?
