Krugman: The Smart (Read: OIL) Money KNOWS the Surge has failed

[BurtWorm]

This is an important column. MUST READ!


http://wealthyfrenchman.blogspot.com/

<hat tip to unhappy camper for the link :toast: >



A Surge, and Then a Stab


By PAUL KRUGMAN
Published: September 14, 2007

To understand what’s really happening in Iraq, follow the oil money, which already knows that the surge has failed.

Back in January, announcing his plan to send more troops to Iraq, President Bush declared that “America will hold the Iraqi government to the benchmarks it has announced.”

Near the top of his list was the promise that “to give every Iraqi citizen a stake in the country’s economy, Iraq will pass legislation to share oil revenues among all Iraqis.”

There was a reason he placed such importance on oil: oil is pretty much the only thing Iraq has going for it. Two-thirds of Iraq’s G.D.P. and almost all its government revenue come from the oil sector. Without an agreed system for sharing oil revenues, there is no Iraq, just a collection of armed gangs fighting for control of resources.

Well, the legislation Mr. Bush promised never materialized, and on Wednesday attempts to arrive at a compromise oil law collapsed.

What’s particularly revealing is the cause of the breakdown. Last month the provincial government in Kurdistan, defying the central government, passed its own oil law; last week a Kurdish Web site announced that the provincial government had signed a production-sharing deal with the Hunt Oil Company of Dallas, and that seems to have been the last straw.

Now here’s the thing: Ray L. Hunt, the chief executive and president of Hunt Oil, is a close political ally of Mr. Bush. More than that, Mr. Hunt is a member of the President’s Foreign Intelligence Advisory Board, a key oversight body.

...

No, what’s interesting about this deal is the fact that Mr. Hunt, thanks to his policy position, is presumably as well-informed about the actual state of affairs in Iraq as anyone in the business world can be. By putting his money into a deal with the Kurds, despite Baghdad’s disapproval, he’s essentially betting that the Iraqi government — which hasn’t met a single one of the major benchmarks Mr. Bush laid out in January — won’t get its act together. Indeed, he’s effectively betting against the survival of Iraq as a nation in any meaningful sense of the term.

The smart money, then, knows that the surge has failed, that the war is lost, and that Iraq is going the way of Yugoslavia. And I suspect that most people in the Bush administration — maybe even Mr. Bush himself — know this, too.

...

[unhappycamper]

1. Read it here:

http://wealthyfrenchman.blogspot.com/

[BurtWorm]

2. Thanks.

I'll borrow that and put it in the OP if you don't mind.

:toast:

[unhappycamper]

4. Go fir it. n/t

[Spazito]

3. Mr. Krugman makes an excellent point, as usual....

The agreement between the provincial government of Kurdistan and Hunt is a key indicator of what is going to happen to Iraq, the splintering into at least 3 separate countries with no peace in sight, imo.

[BurtWorm]

5. kick

[BurtWorm]

6. If the admin had any intention of turning public opinion around, why send Petraeus only to Fox?

<This is Krugman's quesiton, but I asked it myself to myself and here on DU. And I'm sure we weren't the only ones wondering this.>

...


After all, if the administration had any real hope of retrieving the situation in Iraq, officials would be making an all-out effort to get the government of Prime Minister Nuri Kamal al-Maliki to start delivering on some of those benchmarks, perhaps using the threat that Congress would cut off funds otherwise. Instead, the Bushies are making excuses, minimizing Iraqi failures, moving goal posts and, in general, giving the Maliki government no incentive to do anything differently.

And for that matter, if the administration had any real intention of turning public opinion around, as opposed to merely shoring up the base enough to keep Republican members of Congress on board, it would have sent Gen. David Petraeus, the top military commander in Iraq, to as many news media outlets as possible — not granted an exclusive appearance to Fox News on Monday night.

All in all, Mr. Bush’s actions have not been those of a leader seriously trying to win a war. They have, however, been what you’d expect from a man whose plan is to keep up appearances for the next 16 months, never mind the cost in lives and money, then shift the blame for failure onto his successor.

[SOS]

7. Hunt (and Bush) know Iraq will collapse

and Hunt is lining up his Kurdish oil profits now.

Appalling.

K and R!

[riderinthestorm]

8. Way too important to drop off the front page today. A. must. read. K&R!

[Solly Mack]

9. k/r

[Uncle Joe]

10. Thanks for the thread Burtworm

Kicked and recommended.

[smoogatz]

11. k&r

[ljm2002]

12. Great column!

Thanks for posting it.

Krugman's main point is that the smart money is already acknowledging defeat in Iraq, in the sense that they are making oil deals with other entities than the central Iraq government in Baghdad. He is talking about the Hunt Oil Company of Dallas making a deal with the provincial government in Kurdistan, and he points out: "Ray L. Hunt, the chief executive and president of Hunt Oil, is a close political ally of Mr. Bush. More than that, Mr. Hunt is a member of the President’s Foreign Intelligence Advisory Board, a key oversight body."

Now I find his close ties to Bush to be the main thing here. So they've already cornered one part of the oil -- and IIRC, the oil fields in Kurdistan are some of the richest in all of Iraq -- and now they're pissed off because the rest of it does not appear to be forthcoming. Looks to me like they would not mind at all if a partition came out of this, as long as they can make the deals they want to make. But the non-Kurdish elements in Iraq are unwilling to include the US and its lackeys; they are freezing us out. And that is the only failure that Bush cares about; he is going to jut his chin out some more and jump up and down and ... if we're lucky he'll tear himself in half like Rumpelstiltskin and then we'll be done with the whole sorry mess.

[BurtWorm]

13. No matter how Iraq shakes down--it could be run by an Iran-sponsored ShiiteTaliban for all they care

--Bush's corporate paymasters will find a way to profit from Iraqi misery.

[formercia]

14. And the band played on....

'Nearer my God to thee' as she slipped below the waves.....



Got to keep those contracts going and milk it for everything they can.

[Ganja Ninja]

15. All we're fighting for now in Iraq is the GOP's talking points for 2009

That's all that's going to come out of this shit hole. After a trillion dollars and 5000 or so dead soldiers all we end up with is future talking points like "We would have won in Iraq if the Dem's hadn't surrendered." They are planing their future stupidity today and killing our troops in the process just so they can have a talking point that will probably go over like a lead balloon by the time they get to use it.

[Martin Eden]

16. According to Bush, the solution to this humanitarian crisis is ...

... STAY THE COURSE.