April 7, 2017
By Colin Todhunter*
Today, as the dominant global power, the US roles out its brand of unfettered capitalism across the world. US citizens constitute just five percent of the world’s population but consume 24 percent of global energy. Consider the consequences of a US-style model of ‘development’ if it were to be aspired to and copied throughout the world (which it is in places like India and China). The model is unsustainable and based on the premise of endless GDP growth and endless supplies of (finite) fossil fuels to fuel it.
Empire and oil
The US derives its prosperity from oil. It is able to consume goods and resources at such a high level because the dollar serves as the world reserve currency. Demand for it is guaranteed as most international trade (especially oil) is carried out using the dollar. US global hegemony depends on Washington maintaining the dollar’s leading role.
The international monetary system that emerged near the end of the Second World War was based on the US being the dominant economic power (after it watched and let its rivals destroy one another and become indebted as a result of their war efforts) and the main creditor nation, with institutions like the World Bank and International Monetary Fund eventually being created to primarily serve its interests.
By the 1960s, countries like Germany, France and Japan had become industrial competitors and the Vietnam War was bankrupting the US. Not having enough gold to support the dollar, rather than devalue the currency, Henry Kissinger’s ‘diplomacy’ engineered an ‘oil crisis’ to boost the price of oil and Washington since then has been able to run up a huge balance of payments deficit by using the paper dollar as security in itself and engaging in petro-dollar recycling and treasury-bond super-imperialism.
If the transformation of the US into a global superpower was fuelled by its access to oil, the continuation of US global supremacy in the 1970s and beyond has been achieved on the back of oil.
More generally, with its control and manipulation of the World Bank, IMF and WTO, the US has been able to lever the trade and the financial system to its advantage by various means (for example, see this analysis of Saudi Arabia’s oil money in relation to African debt). Washington will not allow its global hegemony and the role of the dollar to be challenged.
The end of the age of oil
Unfortunately for humanity and all life on the planet, Washington deems it necessary to attempt to prolong the age of oil, which is not too surprising given what has just been outlined. This is despite the fact that the decline in oil production will break economies.
In the article ‘And you thought Greece had a problem’ by Norman Pagett, the importance of oil to the modern era is stressed along with some of the consequences of the ‘end of oil’. Its main thrust is that countries like Greece are experiencing energy bankruptcy (not financial bankruptcy), which manifests as financial indebtedness, and that oil-rich countries like Saudi Arabia are living on borrowed time.
In the timespan of human existence, the article notes that the ascendance of modern industrialised man, thanks to oil, has been a short flash of light that has briefly lifted us out of the mire of the middle ages. But the trappings of civilisation have not altered the one rule of existence: if you don’t produce food from the earth on a personal basis, your life depends on someone converting sunlight into food on your behalf.
Destroy agriculture, or the resources to produce food sustainably (water resources, seeds, soil fertility, etc.), which is what we are doing (see this analysis of India and the Green Revolution), and, according to Pagett, most people would starve. What we call modern civilisation in the age of oil is fragile. Pagett argues the only reason we became so wealthy in the last 100 years or so is because of the consumption of oil and the consumer products derived from it.
However, oil is running out and becoming more expensive.
In the coming years, we will thus need to place greater emphasis on reconnecting with nature, as we did previously, to produce our own food again and engage in meaningful production and social relations rooted in our connections with the land, seeds, the seasons, harvests and so on (see ‘Monsanto’s Violence in India: The Sacred and the Profane’ to appreciate how these relations have been fractured or destroyed to suit the bottom line of corporate profit).
Pagett notes that for the millions of homeless people living on the streets in our ‘civilized’ cities, civilization is over. With declining oil and higher oil prices, for them there is little hope of a return to prosperity. He also argues that Arabia’s gleaming cities in the desert are built on its oil. It sells oil for food. When the oil is gone, its increasing population will starve as it will no longer be able to buy in essential needs.
On the other hand, Greece is bankrupt. It can’t afford oil imports (like so many other countries whose debt is spiralling as a result). But it has arable land and water. It could have a future beyond oil.
Then there is the UK, which has to import 40 percent of its food, and much of the rest depends on oil to produce it, which also has to be imported. Pagett says it is the end of the UK’s oil age, but few admit to it being the end of a food age as well. It has been argued that the UK has only 100 harvests left because of the degradation of its soils due to intensive industrial farming.
Pagett also looks at China’s cities, the emptying of the countryside and its unsustainable GDP growth, largely based on a real estate boom to build its ghost cities. The more real estate that is built, the higher the GDP figures, the greater the mirage of ‘growth’. It has become a self-sustaining illusion.
What happens when oil runs out or becomes unbearably scarce and expensive? What happens when you have placed all your eggs in oil-based consumerism and productive activities and have destroyed the very basis of traditional agrarian production, as is happening in India, which sustains life and is the genuine generator of employment? What will become India’s 1.2 billion people with no prospects of making a living (see ‘India’s New Rulers Are the World Bank, IMF, WTO and Monsanto’)?
Without oil, we could survive – but not by continuing to pursue the ‘growth’ model China or India are pursuing or the US has pursued.
Without sustainable agriculture, however, we will not survive. And unsustainable agriculture based on chemical-intensive, oil-based inputs goes hand in hand with the ‘age of oil’ model of ‘development’ we see in India and China.
If the film ‘How Big Oil Conquered the World’ shows how a handful of powerful oil interests uprooted traditional beliefs, practices and societies to recast the modern world in their own image – as profound as those changes were – the end of oil could have even greater repercussions that humanity may not recover from.
What is required is a different way of thinking from what we currently have:
“The root problem is the fact that our economic system demands ever-increasing levels of extraction, production and consumption. Our politicians tell us that we need to keep the global economy growing at more than 3% each year – the minimum necessary for large firms to make aggregate profits. That means every 20 years we need to double the size of the global economy – double the cars, double the fishing, double the mining, double the McFlurries and double the iPads. And then double them again over the next 20 years from their already doubled state.” – Jason Hickel, writing in The Guardian.
US Strategic Objectives and Agribusiness
How can we try to avoid these potential catastrophic consequences, not to mention what appears to be an increasingly likely nuclear conflict with competing imperial powers such as Russia (or China)?
We must move away from militarism and resource-gabbing conflicts by reorganising economies so that nations live within their environmental means. As Jason Hickel advocates, we must maximise human well-being while actively shrinking out consumption levels and ecological footprint. Indeed, Gandhi foresaw this need and described modern societies as being based on a ‘nine-day wonder’ that could not be sustained given the rate of resource depletion.
Key to this involves recognising the key role of agriculture: but not the kind of agriculture being imposed by transnational agribusiness corporations. We need a major shift away from the chemical-intensive industrial model of agriculture and food production, not only because ultimately we will have no choice, but because it has led to bad food, poor health and environmental degradation. The model is unsustainable and has been underpinned by a resource-grabbing, food-deficit producing US foreign policy agenda for many decades, assisted by the WTO, World Bank, IMF and ‘aid’. For instance, see ‘Sowing the Seeds of Famine in Ethiopia’ by Michel Chossudovsky and ‘Destroying African Agriculture’ by Walden Bello.
US agribusiness is a tentacle of Washington’s geopolitical objectives and is essential for colonising indigenous agriculture. The Green Revolution was exported courtesy of the oil-rich interests, and poorer nations adopted agribusiness’s chemical-dependent agriculture that required loans for inputs and infrastructure development. It entailed trapping nations into a globalised system of debt bondage, rigged trade relations and the hollowing out and destruction of national and local economies.
Whether it is Bill Gates facilitating the plunder of African agriculture for corporate interests, the World Economic Forum ‘Grow’ strategy or the World Bank ‘Enabling the Business of Agriculture’ strategy, the aim is to further restructure agriculture across the globe to serve the needs of Western agribusiness companies.
What we see is the capturing of markets and global supply chains for the benefit of transnational corporations involved in food production. We see the destruction of natural habitat in Indonesia to produce palm oil. We see the use of cynical lies to corrupt India’s food system with genetically modified seeds. We witness the devastating impact on farmers and rural communities. We see the degradation of soils, health and water resources. And we also see the transnational corporate commercialisation and displacement of localised productive systems.
The current economic system and model of globalisation and development serves the interests of Western oil companies and financial institutions, global agribusiness and the major arms companies. These interlocking, self-serving interests have managed to institute a globalized system of war, poverty and food insecurity and have acted to devastate economies.
How many more Syrias?
Instead of rebuilding highly productive rural infrastructures based on small farms at the local level, the drive is to destroy indigenous agriculture and local economies and accelerate the treadmill towards disaster. We must contend not only with the lies and deceit of companies like Monsanto who claim to be serving humanity’s interests, but we are also bombarded with the more wide-ranging propaganda that fuels the system of ‘globalisation’ which companies like Monsanto are tied to and fuel.
Monsanto’s whole business model is based on conquest (epitomising the ethos of capitalism). It captures markets and key institutions, destroys competition and relies on the US government to maintain its profits and access to regions of the world. It, like ‘corporate America’ in general, relies on the US state to keep the neoliberal agenda on track by facilitating corporate imperialism (aka globalisation) and Washington’s hegemony.
We now have the situation in Syria where deception once again trumps reality as the US seeks to gain support for broadening its military campaign to balkanise Syria and redraw the map of the Middle East. Unfounded claims about Assad using chemical weapons are front page news, mirroring similar baseless claims that occurred a few years back and mirroring the lie of WMD in Iraq. Millions are dead in Iraq, Syria, Libya and Afghanistan as the US and its allies play out a continuation of a modern-day ‘Great Game’.
We have Western politicians and the media parroting unfounded claims about the Assad government using chemical weapons and lying to the public about it as well as ‘Russian aggression’. All for what? Pipelines, oil and gas. The ‘war on terror’ is a war for resources. It is a war for the benefit of Western capital. It is a war to prolong a dying age of oil, advanced capitalism and easy profits. And these wars and conflicts and the lies to justify them will only get worse as demand across the world for resources grows against a backdrop of depletion.
Whether it is the US, India or China, the need of the hour is to recognise the bankruptcy of imperial endeavours to fuel a moribund system. It has already led to two major world wars. There will be no recovering from a third.
The world is in the grip of a structural war against people, land, economies and ecosystems. It is being waged by organised, institutional criminal interests bent on monopolizing energy, food and violence across the globe. From farmer suicides and failed Bt cotton in India and the impacts of glyphosate in Argentina to war in Syria and beyond, theirs is a neoliberal doctrine of death and destruction.
*Colin Todhunter is an extensively published independent writer and former social policy researcher based in the UK and India.