Greenspan Misses Cheney’s Memo: Spills the Beans on Oil

By Ray McGovern

09/16/07 "ICH" -- -- For those still wondering why President George W. Bush and Vice President Dick Cheney sent our young men and women into Iraq, the secret is now “largely” out.

No, not from the lips of former secretary of state Colin Powell. It appears we shall have to wait until the disgraced general/diplomat draws nearer to meeting his maker before he gets concerned over anything more than the “blot” that Iraq has put on his reputation.

Rather, the uncommon candor comes from a highly respected Republican doyen, economist Alan Greenspan, chairman of the Federal Reserve from 1987 to 2006, whom the president has praised for his “wise policies and prudent judgment.” Sadly for Bush and Cheney, Greenspan decided to put prudence aside in his new book, The Age of Turbulence, and answer the most neuralgic issue of our times—why the United States invaded Iraq.

Greenspan writes:

“I am saddened that it is politically inconvenient to acknowledge what everyone knows: the Iraq war is largely about oil.”

Everyone knows? Would that it were so. But it’s hardly everyone. Sometimes I think it’s hardly anyone.

There are so many, still, who “can’t handle the truth,” and that is all too understandable. I have found it a wrenching experience to be forced to conclude that the America I love would deliberately launch what the Nuremburg Tribunal called the “supreme international crime”—a war of aggression—largely for oil. For those who are able to overcome the very common, instinctive denial, for those who can handle the truth, it really helps to turn off the Sunday football games early enough to catch up on what’s going on.

60 Minutes

On January 11, 2004, viewers of CBS’ 60 Minutes saw another of Bush’s senior economic advisers, former treasury secretary Paul O’Neill discussing The Price of Loyalty, his memoir about his two years inside the Bush administration. O’Neill, a plain speaker, likened the president’s behavior at cabinet meetings to that of “a blind man in a roomful of deaf people.” How does he manage? Cheney and “a praetorian guard that encircled the president” help Bush make decisions off-line, blocking contrary views.

Cheney has a Rumsfeldian knack for aphorisms that don’t parse in the real world— like “deficits don’t matter.” To his credit, O’Neill picked a fight with that and ended up being fired personally by Cheney. In his book, Greenspan heaps scorn on that same Cheneyesque insight.

O’Neill made no bones about his befuddlement over the president’s diffident disengagement from discussions on policy—except, that is, for Bush’s remarks betraying a pep-rally-cheerleader fixation with removing Saddam Hussein and occupying Iraq.

Why Iraq? “Largely Oil”

O’Neill began to understand better after Bush’s inauguration when the discussion among his top advisers abruptly moved to how to divvy up Iraq’s oil wealth. Just days into the job, President Bush created the Cheney energy task force with the stated aim of developing “a national energy policy designed to help the private sector.” Typically, Cheney has been able to keep secret its deliberations and even the names of its members.

But a Freedom of Information Act lawsuit forced the Commerce Department to turn over task force documents, including a map of Iraqi oilfields, pipelines, refineries, terminals, and potential areas for exploration; a Pentagon chart “Foreign Suitors for Iraqi Oilfield Contracts;” and another chart detailing Iraqi oil and gas projects—all dated March 2001.

On the 60 Minutes, program on December 15, 2002, Steve Croft asked then-defense secretary Donald Rumsfeld, “What do you say to people who think this [the coming invasion of Iraq] is about oil?” Rumsfeld replied:

“Nonsense. It just isn’t. There—there—there are certain............. things like that, myths that are floating around. I’m glad you asked. I—it has nothing to do with oil, literally nothing to do with oil.”

Au Contraire

Greenspan’s indiscreet remark adds to the abundant evidence that Iraq oil, and not weapons of mass destruction, was the priority target long before the Bush administration invoked WMD as a pretext to invade Iraq. In the heady days of “Mission Accomplished,” a week after the president landed on the aircraft carrier, then-deputy defense secretary Paul Wolfowitz virtually bragged about the deceit during an interview. On May 9, 2003, Wolfowitz told Vanity Fair:

“The truth is that for reasons that have a lot to do with the U.S. government bureaucracy, we settled on the one issue that everyone could agree on, which was weapons of mass destruction as the core reason...”

That was seven weeks after the invasion; no weapons of mass destruction had been found; and Americans were growing tired of being told that this was because Iraq was the size of California. Eventually, of course, Wolfowitz’ boss Rumsfeld was forced to concede, as he did to me during our impromptu TV debate on May 4, 2006: “It appears that there were not weapons of mass destruction there.”

But three years before, during that heady May of 2003 when all else seemed to be going along swimmingly, the inebriation of apparent success led to another glaring indiscretion by Wolfowitz. During a relaxed moment in Singapore late that month, Wolfowitz reminded the press that Iraq “floats on a sea of oil,” and thus added to the migraine he had already given folks in the White House PR shop.

But wait. For those of us absorbing more than FOX channel news, the primacy of the oil factor was a no-brainer. The limited number of invading troops were ordered to give priority to securing the oil wells and oil industry infrastructure immediately and let looters have their way with just about everything else (including the ammunition storage depots!). Barely three weeks into the war, Rumsfeld famously answered criticism for not stopping the looting: “Stuff happens.” No stuff happened to the Oil Ministry.

Small wonder that, according to O’Neill, Rumsfeld tried hard to dissuade him from writing his book and has avoided all comment on it. As for Greenspan’s book, Rumsfeld will find it easier to dodge questions from the Washington press corps from his sinecure at the Hoover Institute at Stanford.

Eminence Grise...or Oily

The other half of what Col. Larry Wilkerson, Colin Powell’s former chief of staff at the State Department, calls the “Cheney-Rumsfeld cabal” is still lurking in the shadows. What changed Cheney’s mind toward Iraq from his sensible attitude after the Gulf War when, as defense secretary, he defended President George H. W. Bush’s decision not to attempt to oust Saddam Hussein and conquer Iraq? Here is what Cheney said in August 1992:

“...how many additional American casualties is Saddam worth?...not that damned many. So I think we got it right...when the president made the decision that we were not going to go get bogged down in the problems of trying to take over and govern Iraq.”

Cheney’s rather transparent remarks as CEO of Halliburton in autumn 1999 suggest what lies behind the cynical exploitation of genuine patriotism to recruit throwaway soldiers to trade for the chimera of control over the oil in Iraq:

“Oil companies are expected to keep developing enough oil to offset oil depletion and also to meet new demand...So where is the oil going to come from? Governments and the national oil companies are obviously in control of 90 percent of the assets. Oil remains fundamentally a government business. The Middle East with two-thirds of the world’s oil and the lowest cost is still where the prize ultimately lies.”

Not only Cheney, but also many of the captains of the oil industry were looking on Iraq with covetous eyes before the war. Most people forget that the Bush/Cheney administration came in on the heels of severe shortages of oil and natural gas in the U.S., and the passing of a milestone at which the United States had just begun importing more than half of the oil it consumes. One oil executive confided to a New York Times reporter a month before the war: “For any oil company, being in Iraq is like being a kid in F.A.O. Schwarz.”

Canadian writer Linda McQuaig, author of It's the Crude, Dude: War, Big Oil, and the Fight for the Planet (2004), has noted that decades from now it will seem to everyone a real no-brainer. Historians will calmly discuss the war in Iraq and identify oil as one of the key factors in the decision to launch it. They will point to growing US dependence on foreign oil, the competition with China, India, and others for a share of the diminishing world supply of this precious, nonrenewable resource, and the fact that Iraq "floats on a sea of oil.” It will all seem so obvious as to provoke little more than a yawn.

Other Factors Behind the Invasion

There were, to be sure, other factors behind the ill-starred attack on Iraq—the Bush administration’s determination to acquire large, permanent military bases in the area outside of Saudi Arabia, for one. But that factor can be viewed as a subset of the energy motivation—the need to have substantial influence over the extraction and disposition of the oil in Iraq. In other words, the felt need for what the Pentagon prefers to call “enduring” military bases in the Middle East is a function of its strategic importance which, in turn, is a function—you guessed it—of its natural resources. Not only oil, but natural gas and water as well.

I find the evidence persuasive that the other major factor in the Bush/Cheney decision to make war on Iraq was the misguided notion that this would make that part of the world safer for Israel. Indeed, the so-called “neo-conservatives” still running U.S. policy toward the Middle East continue to have great difficulty distinguishing between what they perceive to be the strategic interests of Israel and those of the United States. And in my view, they show themselves extremely myopic on both counts.

Why Are Americans Silent?

Could it be that most of us Americans remain “good Germans” because we are unwilling to recognize the moral implications of starting what is likely to be the first of the resource wars of the 21st century?; because we continue to be comfortable hogging far more than our share of the world’s natural resources?; and because we prefer to look the other way when our leaders tell us that aggressive war is necessary to protect that siren-call, “our way of life,” from attack by those who are just plain “jealous?”

Perhaps a clue can be found in the remarkable reaction I received after a lecture I gave two and a half years ago in a very affluent suburb of Milwaukee. I had devoted much of my talk to the implications of what I consider the most important factoid of this century: the world is running out of oil.

Afterwards some twenty folks lingered in a small circle to ask follow-up questions. A persistent, elegantly dressed man, who just would not let go, dominated the questioning:

"Surely you agree that we need the oil. Then what's your problem? Some 1,450 killed thus far are far fewer than the toll in Vietnam where we lost 58,000; it's a small price to pay... a sustainable rate to bear. What IS your problem?"

I asked the man if he would feel differently if one of the (then) 1,450 already killed were his own son. Judging from his abrupt, incredulous reaction, the suggestion struck him as so farfetched as to be beyond his ken. “It wouldn’t be my son,” he said.

And that, I believe, is a HUGE part of the problem.