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Russia`s Switch into the Euro signals Decline of US Dollar as a Global Currency
The previously unthinkable is now on the table. Russia, the world's second largest oil exporter, is giving serious consideration to trading its black gold in euros, a switch that would surely set dominos in motion among other oil producing nations and, ultimately, knock the dollar off its global throne.
Americans can thank George Bush and his Pirates for accelerating a process that might have taken decades to evolve, but which now looms as a "catastrophe" on the horizon. "There are already a number of countries within OPEC that would prefer to trade in euros," said oil analyst and U.S. Council on Foreign Relations member Youssef Ibrahim, in an interview with the Moscow Times, October 10. "Putin's putting a big card on the table."
A switch to the euro "is really possible," according to Russian economist and Putin advisor Yevgeny Gavrilenkov. "Why not? More than half of Russia's oil trade is with Europe. But there will be great opposition to this from the United States."
Gayrilenkov can be forgiven his understatement. Russian President Vladimir Putin dropped his bombshell as if casually stating the time of day. Is Russia considering a switch from dollar-pricing of petroleum? "We do not rule out that it is possible. That would be interesting for our European partners," Putin told reporters at a joint news conference with German Chancellor Gerhard Schroeder in the Ural Mountains region of Russia.
Interesting, indeed. Even more important than the huge and immediate boost that a Russian oil-euro arrangement would provide to the European Union, the move would signal the definitive end of America's artificial dollar-domination of the planet, a privileged status the U.S. has abused as a weapon since the end of World War II.
As Dr. Sonja Ebron wrote in , February 20, "Given the highly leveraged and fragile state of our economy, an OPEC switch from the dollar to the euro would bring a quick and devastating dollar and Wall Street crash that would make 1929 look like a $50 casino bet." (See "Why African Americans Should Oppose the War.")
One month before the U.S. invasion, Dr. Ebron warned of the monstrous blowback that would result:
"War is not the answer. It's a shortsighted desperation play that is doomed to failure. Our military forces may take but cannot hold Iraq's oil, as they have failed to tame Afghanistan's land. Far from staving off disaster, our arrogance may instead compel OPEC to 'go euro' en masse, taking many oil-consuming nations with them by force of economics. And a trade war with Europe will lend the coup de grace to our economy."
The shrinking superpower
The Bush men launched their offensive largely to ensure that oil would continue to be priced in dollars. American military dominance of the Middle East and a series of "regime changes" would eliminate the euro-threat - or so the theory went. An opposite chain of events has occurred, with the impetus coming, not from OPEC, but from an increasingly confident and assertive Russia, for whom Shock and Awe is mere fireworks.
Putin displayed his card to the world - a bargaining chip with the EU and an implicit threat to the United States - because he could. The "sole superpower" cannot stop him, but must instead come up with terms that outweigh the benefits of euro-logic. The Bush Pirate's quest for a global market subordinate to American fiat has failed. This shift in the global relationship of forces should have been expected when Bush declared war against world order. It is the logical result of, and answer to, the president's 2002 ultimatum, "either you are with us, or against us." The planet now prepares to turn on its own axis. Once set in motion, the effects will be irreversible, no matter which party wins the White House in 2004. Henry C. K. Liu got it right in his far-sighted April 5 Asia Times piece, "The War that may end the age of superpower."
"This war has succeeded in pushing Russia, France, Germany and China closer, in contrast if not in opposition to US interests worldwide, a significant development with long term implications that are difficult to assess at presentS.
"This war will end from its own inevitable evolution, even without anti-war demonstrations. It will not be a happy end. There is yet no discernible exit strategy for the US. After this war, the world will have no superpower, albeit the US will remain strong both economically and militarily."
Saudi Arabia is the number one oil exporter. Having severed its military alliance with the U.S., the Saudi royal family may be ready to drop the other shoe. "The Saudi Crown Prince [Abdullah Bin Abdul Aziz Al-Saud]'s visit to Russia was of great significance and the regime is talking about closer cooperation with LUKoil and other Russian companies," says Council on Foreign Relations oil analyst Youssef Ibrahim.
No nation is eager to upset the global currency regime. ("We do not want to hurt prices on the market," President Putin was quick to add, at his Urals press conference.) The Saudi princes, who value their dollar-denominated wealth more highly than the teachings of Wahhabi Islam, are by inclination among the least likely candidates to lead an OPEC euro-shift. Yet relentless pressures from Ariel Sharon's Israel, its lobbyists and allies on Capitol Hill, and from the Likkud group within the Bush administration, have pushed the Saudis closer to the breakpoint. If Russia goes euro, they will likely follow - sooner, if there is one more military outrage against a sovereign Arab state. (In that sense, the fate of the dollar may be in Sharon's hands.)
Iran, the world's fifth largest oil exporter, would go euro in an instant, once it saw others headed for the door. Venezuela's President Hugo Chavez relishes the idea. His nation exports about as much oil as Iran.
Muslim Indonesia, the oil giant of the Pacific with huge contracts to supply the Chinese, actively debates the merits of the euro. In an April 17 report filed by Bloomberg's Tokyo bureau ("Indonesia May Dump Dollar; Rest of Asia, Too?"), Indonesian Vice President Hamzah Haz was quoted: "One thing is for sure, the adoption of the euro as an alternative means of payments could be an effective solution to speculative dollar-oriented dealings.''
Rule by idiots
Iraq - the invasion and resistance - has worked a sea change in global relations. History is galloping ahead of every scenario that could have been envisioned before the Bush Pirates set out on their hegemonic mission. However, the scheming fools at the Project for a New American Century must be given their due; only the most monumental stupidity, arrogance and willful ignorance could have set the reigning superpower on such a calamitous course toward political isolation, economic instability, and shrinking relevance to the designs of mankind.
Saddam Hussein began trading Iraqi oil in euros in November 2000. "This was another reason [why the U.S. attacked]," said analyst Ibrahim in his Moscow Times interview. "There is a great political dimension to this. Slowly more power and muscle is moving from the United States to the EU, and that's mainly because of what happened in Iraq."
The Bush men also saw the Iraq invasion as a world-remaking, catalytic event. They destroyed Iraq's infrastructure, so that corporate cronies could reap billions "reconstructing" the nation along the Houston model, as a base for further penetration of the Middle East and Central Asia. The unraveling came quickly. Now, even the handpicked, non-governing Iraqi Governing Council looks forward to voiding the criminally exorbitant reconstruction contracts imposed by the occupation authorities. George Bush "has signed many papers," said Ammar Abdul Aziz, son of prominent Shi'ite Council member Abdul Aziz al-Hakim. "But one day the occupiers will leave. The Iraqi people will not allow any of these contracts." (See "A Shi'ite Warning to America," Asia Times, October 11.)
Having painfully experienced America's way of doing business, a sovereign Iraq could be expected to join the euro-rush.
Renowned political journalist and author Tariq Ali, speaking on Democracy Now! October 10, peers through the Iraqi end of the tunnel: "The big thing will happen when the Shi'ite groups in the south of Iraq decide enough is enough and join the resistance and, when they do, it really will be the beginning of the end. There's no way they can carry on."
The inevitable collapse of the U.S. occupation and the looming shift to the euro will dictate the broad outlines of world affairs in the near term, and dramatically impact conditions of life in the United States.
Journalist Sydney Schanberg, writing in the current issue of the the Village Voice, wonders what happened to the Pentagon's seven-nation, five-year Middle East-North Africa war campaign - the plan Wesley Clark learned of in November, 2001, but didn't get around to telling the public about until publication of his latest book, last month. (See , "Wesley Clark: Dishonest to the Core, and Probably Nuts," October 9.) "How far has the White House taken this plan?" asks Schanberg. "And how long can the president keep the nation in the dark, emerging from his White House cocoon only to speak to us in slogans and the sterile language of pep rallies?"
The Project for a New American Century folks are still in charge, Condoleezza Rice's new duties, notwithstanding. It is their plan that has plunged the U.S. into premature and precipitous decline, and presents a catastrophic threat to the dollar.
On April 3, before the taking of Baghdad, we wrote of the predictable consequences of the Iraq invasion:
In self-defense, the world will be forced to reorganize itself, to create new mechanisms of trade and security in place of the institutions that the Bush men are deliberately savaging. The Americans will be left out of these arrangements..
A kind of international redlining will increasingly make itself felt, but not seen. The Bush men believe they are willing into existence a New American Century, while in reality they are creating an America-phobic planet in which the U.S. has earned an invisible but powerfully consequential non-favored nation status. Having invented the concept of globalism, the United States will be consigned to pariah status - and shrink, until it learns to live by human norms and scales.
Think of an oil-producer switch to the euro as the redlining of America.
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