Going for Oil (1999)

From the January 1999 issue of the Socialist Standard

The US State Department once described oil as “the greatest material prize in world history”. Considering its value to present-day society and the lengths the US has gone in order to control an ever-greater share of the world supply of black gold, this would seem a fair description.

Just as its acrid smell has carried US profit-mongers, and indeed their war machine, over the entire globe, siding with all manner of tyrants, engaging in who knows how many atrocities in the process, so too is it now luring the US to a region of the world bedevilled by unrest manifesting itself in ethnic rivalry and border disputes and ruled by power-hungry and corrupt governments—The Caspian.

Long ago, the black sticky stuff that bubbled to the surface to be poured into leather bags and sold by camel trains throughout the Caspian region aroused no great interest. Now, a new type of entrepreneur is on the scene—the world’s oil companies, perhaps the most unscrupulous of capitalists.

Eighty of the world’s biggest oil companies have been wheeling and dealing in Baku and other Caspian cities since the collapse of Soviet state capitalism in 1989. No-one knows for sure just how much oil awaits them. Proven resources, according to BP’s Statistical Review of World Energy, are 17 billion barrels and that yet to be found ranges from 20 billion bbls (International Institute for Strategic Studies) to a 1996 estimate of 178 billion bbls—the latter perhaps making the Caspian one of the most important oil-producing regions in the world. However, a generally accepted figure is that of 50 billion bbls and worth some $4 trillion at today’s prices—a sum that hints instantly at trouble.

US oil companies have long since sweetened the former Soviet republics of Azerbaijan, Kazakhstan and Turkmenistan with $2 billions-worth of investment, reviving to an extent their collapsed economies—or rather making them ripe for milking—and at the same time making them less dependent on Russia. Moreover, US oil giants have lobbied on behalf of Caspian governments in Washington, extolling the virtues of their political causes.

Already this is bearing fruit, with Azerbaijan and Kazakhstan signing deals worth £40 billion with the West. Azerbaijan has signed deals with 10 consortia so far, the biggest shareholder being BP and Amoco.

While the former Soviet republics are adamant they should be free to exploit their own wealth, Russia and Iran, the two remaining countries whose shores are lapped by the Caspian, have other thoughts. Both are major oil producers themselves and have genuine fears of what a Caspian oil boom could mean to their own interests. When we consider that oil is pumped out of Kazakhstan, for instance, three times cheaper than out of Siberia, it is understandable that Russian capitalists fear a tremendous fall in their profits as oil begins to pour out of their former states through more efficient outlets.

Both Russia and Iran insist on a fair share of the development of the Caspian oil fields and argue strenuously that pipelines should be allowed to pass through their own territory. Russia has suggested that countries bordering the Caspian should each carry out offshore production inside a 72 kilometre zone and that the waters should be shared. And both Russia and Iran have backed their claim to shared waters by pointing to their naval forces (Russia has 90 naval craft in the Caspian).

Like Russia, Iran is also wary of US interest in the region, believing the Clinton administration is trying to marginalise Teheran’s role in the Caspian and, like Russia, argues for “fairness”, Teheran insisting that negotiations on who drills where on the Caspian seabed be carried out by all concerned, with Iran maintaining the right to veto any decision it construes as being detrimental to its own interests.

Teheran is also rumoured to be contemplating ways to upset US plans to take Iran out of the Caspian equation, one being to offer a better price for oil that could be won in Europe.

For their part, the US claim they want the oil to flow out through numerous pipelines, thus allowing no country to monopolise it. In June, Clinton was heard singing the praises of Iran as it moved towards “democracy”. He spoke of how Iran was “changing in a positive way” and how the US was seeking a “genuine reconciliation” with Iran. And just as the US dismiss trying to undermine Iran’s interests in the Caspian, they similarly claim no opposition to oil pipelines running through Russia, so long as Russia does not control the valves.

The biggest argument at present seems to be over which direction the oil should flow out of the Caspian. It is a debate that can only intensify the longer it rages. The arrival of the US (mainly since 1995) and the preparedness of the former soviet republics to foster a strong relationship with Washington suggests trouble ahead.

As the International Herald Tribune recently reported:

  The drive by US companies to exploit these resources already has produced a political realignment of historical dimensions including an unprecedented American presence in a region that has been under continuous Russian control since the mid 18th Century (5 October 1998).

With the demand for oil expected to increase by 30 percent in the next 20 years, we have every reason for keeping a close eye on developments in the Caspian. At the moment, the region is relatively stable, but history teaches us troops could be mobilised overnight when profits are threatened and that deals are only as strong as the paper they are written on when “the greatest material prize in world history” is at stake.

John Bissett

A Reply to CND (1999)

From the January 1999 issue of the Socialist Standard

Thank you for your circular letter “Trident—what the bloody hell for?”, delivered through my letterbox.

You talk about the “astounding”, “shocking”, and “sickening” nature of the government’s current actions and beliefs, but forgive me: what about yours?

This government, like all governments, represents the interests of the state; and the state acts as a collective for the interests of society’s owning class (landowners, landlords, entrepreneurs and other capitalists). In pursuit of the interests of the capitalist class the state will, as Brecht put it, “make war as a continuation of business by other means”. The idea that given the likelihood of war it is either possible or sensible to discriminate as between particular kinds of weapons—voting against nuclear weapons but in favour of others—now that really is “astounding”, “shocking”, and “sickening”. It is also mind-bendingly foolish.

If you are opposed to war and all that it represents—as any right thinking person should be—you will advocate policies and take actions which will make war impossible, by removing its causes. That is, you will seek to transform society in the interests of human beings as a whole, without restriction to so-called race, nationality or gender, by establishing socialism in place of capitalism.

To do what you do—to object to some weapons which might be used in wars, whilst implicitly tolerating others—is to accept the inevitability of war, and the social system which underpins it. Your efforts, because they oppose only certain kinds of war, and not war itself, serve, whether intentionally or otherwise, to make war more likely. Your literature obscures and obfuscates. It makes the likelihood of enlightenment and desirable change the more difficult. However concerned you may feel about the welfare of the human race, your actions betray the very constituency you claim to serve.

Campaigning against nuclear weapons is an irrelevance. Nuclear weapons are unlikely to be used in East Timor, or Kosovo, or central Africa, or any of the other myriad “trouble spots” across the globe. Tens of millions of people have been killed since the end of World War II, and not a nuclear weapon fired in action. Are you unconcerned about such matters? By what contorted logic does “manner of death” come to mean more to you than “fact of death”?

I accept that most members of CND are well motivated: that to use a cliché, “they care”. But actions if they are to be effective require more than refined sensibilities. It is not enough that behaviour is well motivated: if it is to be effective it must be appropriate. An effective parent knows that it isn’t enough to want to act in a child’s interest; that if you are to be effective, you need also to know what to do. Members of CND need to learn just what is involved in keeping people free from the tyranny of death by war—whether at the hands of nuclear weapons or acceptable (sic) alternatives—and free also from poverty and famine, and poor health and abject lifestyles, and all the other social ills which are celebrated daily by capitalism.

If you really care about people you will want to campaign for their enlightenment; for an absence of nuclear weapons and war—in a word, for socialism.

Michael Gill

50 Years Ago: A Letter from Ireland (1999)

The 50 Years Ago column from the January 1999 issue of the Socialist Standard

And now “Dev.” and Costello, and the other “great Irish leaders,” are hitting their headlines with speeches railing against Partition in Ireland. Well, in conclusion, let me say that we Socialists in Ireland equally desire, and ceaselessly work for, the ending of Partition, also—but we never get any headlines in the Press. Oh, no; for the Partition we speak against is not a geographical one but an economic one. The Partition we oppose is that between the rich and poor, between the capitalist class and the working class. That is the Partition, a universal one, which Socialists everywhere seek to abolish, and that I suggest, is the only Partition which you, and all other workers, ought to concentrate on and bend all your efforts towards removing.

National boundaries may be altered—may even disappear—but such re-arrangements of things, geographical can in no way abolish, or even lessen, the poverty of the many. The solution to that problem will not be found by struggling for Empires or Republics (whether of the 26- or 32-County variety), but by striving for the World Socialist Commonwealth.

So—Yours for Socialism,

Chris Walsh 

(Dublin Socialist Group)

[From the Socialist Standard, January 1949]

Contradictions in Euroland (1999)

From the January 1999 issue of the Socialist Standard

Only a few weeks before the launch of the single currency in Europe and just when things should have been coming together, a public row broke out between the monetarist European central bankers of Frankfurt and the French and German governments.

Put simply, the politicians (especially the new German government under Gerhard Schröder and his Finance Minister Oscar Lafontaine, the Sun’s latest bugbear) are talking of reflating Euroland—the 11 member states who adopted the euro as their common currency on 1 January—with extra government borrowing and spending in order to deal with structural unemployment. Of course, this attempt to revive discredited Keynesianism has not gone down well with the “orthodox” central bankers who think this will threaten the strength and stability of the euro. Such a clash of opinions is highly significant, with Wim Duisenberg, the President of the new European Central Bank (ECB), publicly condemning such economic “recklessness”.

Indeed, for those who remember the Maastricht “convergence criteria” and the Amsterdam “stability pact”, the politicians would seem to be wanting a major U-turn, but a closer inspection reveals the “Euro-fudge” which has always been there.

The process of closer integration in Europe has been driven in recent years by the Franco-German axis. In monetary terms this has been characterised by the “franc fort” (strong franc) policy whereby France pegged the franc to the German mark and its satellite currencies. France has always wanted Germany to cede more on the politics of economic and monetary union and not least on the idea of an “economic government” for Europe.

Germany used to favour a “strong” euro to replace the mark. France has been less orthodox and sought to weaken monetary policy with references to growth and employment targets. With the coming to power in Bonn of the new Red-Green coalition, it would appear that Germany is coming round to the French view.

Such a policy mess does not bode well for Euroland. There is also the plan to expand the EU eastwards, which must mean structural adjustments to the Common Agricultural Policy and fiscal transfers from the richer and “Club Med” states to the new entrants. Quite how such a plan is designed to sit with the single currency is anybody’s guess.

Further, the EU and the US have locked into yet another trade row, this time about banana imports which some commentators see as one of the first moves towards protectionism as the world economy faces recession. Indeed, this is the real context—the world crisis of capitalism. Faced with ever-increasing concentration of capital, the EU plan is to forge together in order to take on the big boys, the US and Japan.

Where does this leave Blair? After nailing his colours to the European mast is it any wonder he is so worried about the new direction for Europe proposed by Lafontaine and the others? It is, after all, a bit Old Labour and Mr Murdoch will be even less pleased with New Labour for getting caught up with such corporatism.

Dave Flynn

Editorial: The side show (1999)

Editorial from the January 1999 issue of the Socialist Standard

Reform of the House of Lords, changing the voting system, elected local mayors, these are the issues the politicians and media have wanted us to get interested in recently. But why, when a recession is looming, are they trying to get us so worked up about constitutional issues?

The experience of the three previous recessions since 1973 has taught politicians that they can do nothing to stop a recession coming. All they can do is brace themselves and wait for it to pass by. There is, however, one field where a government does have some power to change things—the constitution. The Blair government has been exploiting this to the full, in a bid to avoid losing credibility through appearing to be completely powerless.

The House of Lords is to be reformed. This was an issue when the Socialist Party was formed in 1904. At that time and for many years afterwards the Labour Party campaigned for the abolition pure and simple of the House of Lords. Like the Monarchy this is indeed an anti-democratic relic of feudalism which will have no place in a socialist society. (It may have no place in a modern capitalist society either, but that’s for supporters of capitalism to decide.)

Attlee, as pre-war Labour leader, once unwisely said that if he was ever offered a seat in the Lords he would call himself Lord Love-A-Duck of Limehouse. When the offer came he bottled out, and his son now sits in the Lords as the second Earl Attlee of Walthamstow. As a hereditary he may (or, it now seems, may not) be booted out by Blair and be replaced by some superannuated hack nominated by one or other of the main political parties who will still be entitled to call themselves Baron or Baroness.

As to electoral changes, the unelected but non-hereditary (which, apparently, makes it alright) Baron Jenkins in his Report commissioned by the government recommended a complicated hybrid system whose main aim would seem to be to give his party—the Liberal Democrats—more MPs. In the days when a spade was called a spade this would have been known as gerrymandering.

But this is to fall into the trap of discussing these constitutional reforms seriously. The fact is that they are completely irrelevant as far as the real, social and economic problems people face are concerned. They won’t make any difference to these, and they aren’t even democratic.

Blair’s battle with the Lords is a side-show that should not distract us from the real issue. What is required is not constitutional reform but social revolution—a change in the basis of society from class ownership and production for profit to common ownership by all and production to satisfy people’s needs. This is the only framework—which will end the privileges of wealth and not just of birth—within which the urgent problems of pollution, mass unemployment, transport chaos, a crumbling health service, social breakdown and so on and so on can be solved in a rational way.