September 17, 2007

Our Washington Wise Men, cont.

Alan Greenspan's contention that "the Iraq War is largely about oil" is reassuring in the sense that at least somebody thinks the war is about something, rather than, as it looks more and more, about nothing. But, now that details of Greenspan's thinking have emerged in the Washington Post, the security of believing in a vast Machiavellian conspiracy of incisive strategic minds has been shattered once again:

Greenspan: Ouster Of Hussein Crucial For Oil Security

By Bob Woodward
Washington Post Staff Writer

Alan Greenspan, the former Federal Reserve chairman, said in an interview that the removal of Saddam Hussein had been "essential" to secure world oil supplies, a point he emphasized to the White House in private conversations before the 2003 invasion of Iraq.

Greenspan, who was the country's top voice on monetary policy at the time Bush decided to go to war in Iraq, has refrained from extensive public comment on it until now, but he made the striking comment in a new memoir out today that "the Iraq War is largely about oil." In the interview, he clarified that sentence in his 531-page book, saying that while securing global oil supplies was "not the administration's motive," he had presented the White House with the case for why removing Hussein was important for the global economy.

"I was not saying that that's the administration's motive," Greenspan said in an interview Saturday, "I'm just saying that if somebody asked me, 'Are we fortunate in taking out Saddam?' I would say it was essential."

He said that in his discussions with President Bush and Vice President Cheney, "I have never heard them basically say, 'We've got to protect the oil supplies of the world,' but that would have been my motive." Greenspan said that he made his economic argument to White House officials and that one lower-level official, whom he declined to identify, told him, "Well, unfortunately, we can't talk about oil." Asked if he had made his point to Cheney specifically, Greenspan said yes, then added, "I talked to everybody about that."

Greenspan said he had backed Hussein's ouster, either through war or covert action. "I wasn't arguing for war per se," he said. But "to take [Hussein] out, in my judgment, it was something important for the West to do and essential, but I never saw Plan B" -- an alternative to war. ...

As for Iraq, Greenspan said that at the time of the invasion, he believed, like Bush, that Iraq had weapons of mass destruction "because Saddam was acting so guiltily trying to protect something." While he was "reasonably sure he did not have an atomic weapon," he added, "my view was that if we do nothing, eventually he would gain control of a weapon."

His main support for Hussein's ouster, though, was economically motivated. "If Saddam Hussein had been head of Iraq and there was no oil under those sands," Greenspan said, "our response to him would not have been as strong as it was in the first gulf war. And the second gulf war is an extension of the first. My view is that Saddam, looking over his 30-year history, very clearly was giving evidence of moving towards controlling the Straits of Hormuz, where there are 17, 18, 19 million barrels a day" passing through.

Greenspan said disruption of even 3 to 4 million barrels a day could translate into oil prices as high as $120 a barrel -- far above even the recent highs of $80 set last week -- and the loss of anything more would mean "chaos" to the global economy.

Given that, "I'm saying taking Saddam out was essential," he said. But he added that he was not implying that the war was an oil grab.

"No, no, no," he said. Getting rid of Hussein achieved the purpose of "making certain that the existing system [of oil markets] continues to work, frankly, until we find other [energy supplies], which ultimately we will."

Uh, I realize I wasn't the most powerful unelected official in America for two decades like Mr. Greenspan was, and I lack his sources of inside information, but how exactly was this decade's Saddam Hussein, with no air force and rusty tanks, going to get to the Straits of Hormuz, which would require him to fight past American military bases in Kuwait, Bahrain, and Oman? A fleet of lateen-rigged dhows? A camel caravan marching for 20 waterless days across the Anvil of the Sun to attack from behind? A really long tunnel?

By the way, it always seemed strange to me that Greenspan, widely worshipped when he was an old man as the essence of wisdom, when in his prime, from his late 20s up at least through the age of 42, had been a leading acolyte in the Ayn Rand cult. Bill Bradford reported in The American Enterprise:


As I learned in hours of interviews with their associates, Greenspan was a member of Rand’s inner circle during this entire period [the 1950s] and beyond. He lectured on economics for the Nathaniel Branden Institute. He wrote for the first issue of The Objectivist Newsletter, and when Rand broke with Branden [her 25-year younger lover], he signed a public statement condemning the traitor “irrevocably.” [Greenspan was then in his 40s.]


Randall Parker tees off on Greenspan in "Greenspan Deluded On Saddam Threat To Strait Of Hormuz," and points out:

Greenspan is another example of a general problem we face: We are poorly led. We give our elites - especially our political elites - far too much respect and deference. These people are nowhere near as competent as they make themselves out to be. The really talented people in America are in investment banks and Silicon Valley start-ups. They aren't in Washington DC in high government positions. Though I bet there are some smart people on K Street manipulating the yahoos in government.

We mostly are better off if the sharpest people are in venture capital-funded start-ups and investment banks. The private sector generates the wealth. But we need some small handful of sharpies in key positions of power who can recognize when nonsense is being spoken and say no to stupid policies.

For whatever it's worth, I figured I'd repost this blog item I wrote around June 11, 2003, which ws based on some emails I exchanged with Stanley Kurtz shortly before the invasion of Iraq.:

And, oh, yeah, that stuff about Saddam being a threat to invade Kuwait again? The normally sensible Stanley Kurtz imprudently rehashes his prewar scaremongering about how Saddam couldn't be deterred the moment -- Any Day Now -- when he got a nuclear bomb, or maybe a dirty bomb (which ain't exactly the same thing). Deterrence might have worked on Joe Stalin, but Saddam was just utterly crazed, etc etc.


Obviously, Saddam hasn't had any sort of nuclear bomb program to speak of since 1995, or some Iraqi would have told us about it by now. What, you think Iraqis have some kind of Sicilian code of omerta and every single one of the hundreds or thousands of workers is steadfastly refusing to tell the conquerors exactly what they want to hear? Yeah, that's exactly how Arabs behave...


But even if Saddam had a nuclear bomb, the evident weakness in Kurtz's case that Saddam was going to invade Kuwait again was overwhelmingly confirmed by the fighting south of Baghdad. In short, nuclear weapons, even if they existed, were irrelevant because his tanks would never have gotten to Kuwait. America's absolute air superiority meant they would never have made it through the No-Fly zone before being turned to scrap. Without air superiority, tanks are worthless in open country (not that Saddam's rust bucket tanks were worth much under any conditions). And the Iraqi regime didn't even send up one airplane to defend itself. Nobody, rational or irrational, smart or stupid, can conquer Kuwait if they can't physically get to Kuwait. And Saddam's tanks couldn't get there without first being turned into hamburger helper by our Warthogs.


Tell me, did you see anything during the three weeks war that indicated that Saddam could mount a credible invasion of anybody?


Now, you might argue that Saddam could have sat in Baghdad and threatened nuclear terrorism against NYC if we didn't let his boys drive to Kuwait, but nuclear terrorism is a really, really stupid idea if you have a return address (e.g., Downtown Baghdad).


Of course, even in extremis, he didn't do anything remotely like that, as the whole world has seen.


Basically, Stanley's not describing the historical Saddam, may he be burning in hell, but Dr. Evil from the Austin Powers movies: "I will blow up the world unless you pay me ... ONE MILLION DOLLARS!" This threat is perhaps practicable if your secret lair is a laboratory hidden in a hollowed-out volcano, but not if you own 47 palaces.


Clearly, we do need to do some game theorizing about what to do with Dr. Evil-type figures -- in fact, Osama bin Laden (remember him?) is as close to a Goldfinger-type bad guy as I ever want to see -- but it doesn't do American credibility any good to say easily falsifiable things like Saddam was a major danger to invade Kuwait despite absolute air inferiority. And American credibility is a dangerous thing to waste.

Nuclear weapons are extremely useful deterrents against invasion, as we showed in the Fulda Gap for 40 years. As offensive weapons ... Let's just say that any 3rd World regime's strategy for conquest that relies upon initiating a nuclear exchange with the Strategic Air Command is a non-starter.


It's all very well to plan for crazed leaders acting in random fashions, but the vast proportion of bad things that have happened down through history have happened for superficially plausible reasons. So, our first priority must be to make sure we are providing the correct incentive structures for non-random actors. The problem is that we've just once again upped the need for regimes to acquire nuclear deterrrents to prevent American attack (as did our aggression in Yugoslavia in 1999). Our destroying the utility of weapons inspections as a viable instrument -- in their very moment of triumph -- is likely to encourage proliferation of nuclear or infectious biological weapons. Since not having weapons of mass destruction is no defense against the whim of the President of the United States, you'd better have them. In turn, that increases the chances of crazed leaders or Dr. Evil-types getting them.

My published articles are archived at iSteve.com -- Steve Sailer

33 comments:

  1. How would Saddam control the Straits?

    By running past the inept and incapable Saudis in the middle of the Desert and intimidating the Omanis and other Gulf Arabs into denying the US the ability to launch air strikes against him.

    Saddam's biggest military mistake was STOPPING at Kuwait instead of just rushing down. Had he done that he could have mined the Gulf and constructed fortified artillery to shut off shipping.

    As an inept producer, Oil at $120 a barrel would be in his interest.

    We certainly could have dealt with Saddam, but it would have made Iraq look like a picnic. We lost 5,000 men on the FIRST DAY at Omaha Beach. Saddam may have bet on US casualty aversion to save him. It's been the standard critique of the US from Osama, Saddam, Syria, Iran, all our enemies.

    Is this realistic? No. Which is why Greenspan who was relatively skilled at interest rate questions is not very useful outside his expertise. And why I don't ask my Doctor to do my taxes.

    The risk of leaving Saddam in power of course is that America would simply be a passive reactive player to what Saddam would do. SADDAM would have the initiative: nuke or not, chemical weapons/bio weapons or not. Footsie with Osama or not. Given a complete lack of any real human intel on Saddam at the point he was a great big info black hole.

    Now it's alleged that Syria and North Korea were collaborating on SOMETHING that Israel hit.

    Syria has been VERY quiet -- no UN demands, Security Council actions. The Arab Street has reacted with -- utter silence (Iran-Syria scare them more than Israelis, WHATEVER North Korea is alleged to have sent Syria could be used against THEM by Iran's puppet as well as Israel).

    Did North Korea send out their nuclear material to Syria for cold hard cash in advance of the Bush deal? Missile tech? BOTH? Something else? Who knows. Kim's entire economy though is based on selling military stuff for cash (Juche). Syria's "Agricultural Research Station" which was bombed has a LOT of resources and money alloted to it. Something seems to be going on there.

    Turkey's military assisted Israel, which mounted a joint commando-Air Raid operation. They did NOT tell Turkey's President and allowed Israel access to Turkish airspace.

    The biggest argument for removing Saddam though was that he was too weak not too strong. Too weak to act as a counterweight to Iran, and so weak he'd look for anyone to prop him up, including AQ or make a deal for cash for nukes with willing sellers: North Korea, Pakistan, China, whoever.

    But Iraq is old news. The big news is what Iran will do (Chirac and Sarkozy both talking tough on Iran's nukes is big red flag that Iran has threatened them both as France's Muslim "protectors" and threatens basic French Sovereignty).

    Modern tech means any old nation even Iran can get nukes if it really wants them. I suspect Abaizaid is right, we can live with Iran's nukes but it requires MAD including launch on warning to completely erase the nation and explicit inclusion of allies including France and Israel.

    Moreover given the standard critique of the US by Iran (we are too weak and easily intimidated) and the facts that back that view up: non-response to the Embassy invasion, Khobar Towers, Buenos Aires bombings, 9/11 help to bin Laden, sheltering Saad bin Laden, etc. we'd have to do something HORRIBLE to disabuse them of that view.

    Might as well get rid of the regime in the first place.

    It's always better to seize the initiative than just sit back waiting to get hit.

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  2. Saddam was spending his time writing romance novels, not preparing his crack blitzkrieg korps for the second coming of June 22, 1941.

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  3. And, Arabs ain't Germans.It's as if the first post were completely divorced from the reality that is shared by Arab armies in combat:they're good at looting and massacring, but fold and run in the face of real opposition.

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  4. anon:
    "It's always better to seize the initiative than just sit back waiting to get hit."

    Sounds good, but false. "We must run any risk to be safe" is a recipe for disaster. This exact same thinking led Germany into WW1, just as it led America into Iraq2.

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  5. We certainly could have dealt with Saddam, but it would have made Iraq look like a picnic. We lost 5,000 men on the FIRST DAY at Omaha Beach.

    But we knocked Iraq out of Kuwait in 6 days with less than 50 casualties.

    You are just squirting squid ink at this point.

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  6. Saddam was spending his time writing romance novels, not preparing his crack blitzkrieg korps for the second coming of June 22, 1941.

    -Steve Sailer


    When I was a kid I worked for an Iranian Arab, and he loved romance novels. I thought it was a bit curious for a man to be reading these books, but I was just a kid and he was my boss so I never asked about it.

    Perhaps this male interest in romance novels is a feature of Gulf Arab culture.

    Interestingly, there is a genre of romance novels popular with Western girls called "sheikh romance." This site has a graph that tracks interest in the sheikh genre. I don't know exactly what to make of the graph -- the up-trend starts a couple of years before 9/11 and then peaks right around the invasion of Iraq. Maybe I should ask my wife.

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  7. Wow, paranoid-schizo is back again with the first message. Did you read any of Steve’s post? By your logic Mussolini’s big mistake was stopping at Egypt. Although we all know Arabs could never have conquerored Albania or Ethiopia.

    SOMETHING is going on SOMEWHERE by SOMEONE and it could be ANYTHING. Especially given the established facts of: (a) Saddam’s powerful and proven conventional military’s ability to conqueror the entire Gulf in the face of American opposition, (b) Saddam’s weakness driving him into an illicit homosexual love affair with Osama, lil’Kim, etc. (c) Syria’s obvious guilt by silence, (d) Iran’s professed nuclear umbrella over Muslims in France, (e) the widespread availability of nukes and long-range delivery systems via any mail-order outfit, and (f) America’s obvious cowardly unwillingness to use any military responses against states with/Afghanistan or without/Iraq connections to amorphous non-state terrorist acting against the US. Given this, of course we should be proactive and attack before we’re nuked or gassed by states that have neither ability – you just tell us who and when.

    Do such hardcore neocons actually live in their own Dr. Evil fantasy world or are such far-fetched fables propaganda for the masses in service of other more rational ends? Doesn't the poster realize that propaganda has to contain a minimum of truth and plausibility least it prove counterproductive?

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  8. He wrote for the first issue of The Objectivist Newsletter, and when Rand broke with Branden [her 25-year younger lover], he signed a public statement condemning the traitor “irrevocably.”

    Perhaps I haven't given Objectivism the attention it's due. Much younger lovers that I abandon cruelly without it turning out like Sunset Boulevard? How does one become an Objectivist? More importantly, where is the book with pictures of the young men I'll have to choose from?

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  9. I agree that we should not have invaded Iraq, but you can't say that Saddam couldn't keep a nuclear secret. We were completely ignorant of Saddam's enrichment program before the first Iraq war.

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  10. Righ on Steve.
    “"I was not saying that that's the administration's motive," Greenspan said in an interview Saturday, "I'm just saying that if somebody asked me, 'Are we fortunate in taking out Saddam?' I would say it was essential."
    That's a huge difference. Unfortunately, the truth is having a hard time catching up to the lie so that most people who have read or heard of Greenspan's book, probably think he is accusing the Administration of going to war in order to secure oil supplies.”

    Greenspan has been all but proven wrong on that since Sadaam was less of a threat than thought, his army was defeated in 2 weeks, and Iraqi petroleum being off the market has done little economic harm to world economies.

    This IMO is a much better analysis:

    http://www.cato.org/pubs/pas/pa-598.pdf

    “The most common rationale heard today for higher gasoline taxes is the complaint that oil consumption harms national security. There are four distinct arguments. First, oil imports require the United States military to secure foreign production facilities and shipping lanes. Second, good relations with oil producers are necessary to ensure that oil flows into U.S. ports, but good relations with producers can impose unacceptably large shortand long-term costs on the Treasury and contribute to anti-American sentiment, which itself imposes costs. Third, oil profits fund Islamic extremists. Fourth, oil revenues are often captured by international bad actors, and the harm done by those regimes both within and without their borders is to some extent “paid for” by U.S. motorists. None of those costs, however, are paid by those who consume gasoline. Hence, higher gasoline taxes would internalize the externalities. In this section we examine each argument.”

    “From an economic perspective, the key question is whether an elimination of U.S. military and foreign aid expenditures dedicated to “the oil mission” would result in an increase in the price of oil, and, if so, how much? That is the true measure of the national security externality if it exists. Measuring the externality by the amount of money government spends on the oil mission is at best a measure of how much politicians believe the externality might be. Political assessments may or may not be accurate.”

    “U.S. military activities in the Middle East,which are justified in part by the desire to secure oil production and export facilities. But those expenditures are properly thought of as wealth transfers rather than externality-creating payments because their termination would not alter oil prices. Good relations with oil producers have no effect on the price or the availability of oil in the world market. Oil revenues are not necessary for terrorist activity, and the variation in terrorist activity over time does not seem to be related to oil revenue. And while bad
    international actors do indeed get rich off oil revenues, gasoline taxes are unlikely to substantially reduce the degree or the extent of bad acting.”

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  11. "We give our elites - especially our political elites - far too much respect and deference. "
    Amen! Amen!

    The politicians are experts at one thing, getting people to vote for them. News media are experts at one thing, getting people to read or tune in so the advertisers can sell soap.

    Also it amazes me when smart people say that Ayn Rand was a big influence to them argggg!

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  12. Reagan sent the Navy to protect shipping during the Iraq-Iran War without invading anyone. It wasn't without cost: the Stark hit by a missile, the Samuel B. Roberts damaged by a mine, the Vincennes shooting down a civilian airliner. A whole lot cheaper in money and life than an invasion, though.

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  13. "Moreover given the standard critique of the US by Iran (we are too weak and easily intimidated) "

    Yeah you may think that but after seeing our army destroy Iraq in a few days the people in the Middle-East probably flinch and tremble when they hear that the USA might invade. This is the one good thing about the war in Iraq. We should not have invaded but having invaded we should have left after we won.

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  14. The really talented people in America are in investment banks

    Ha!
    Only someone who has spent very little time with investment bankers can say this with a straight face. Most of the I-bankers I deal with are shockingly ignorant about even basic business issues. Success in i-banking (and in America generally) usually goes to the aggressive and the charismatic, not the intelligent and the competent. But it is also true that the cream of the crop no longer goes into i-banking - they go into private equity and hedge funds. I-banking is, ironically, almost becoming a second tier job.

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  15. The leftist journalist Greg Palast has a crazy theory that, oddly, fits the facts better than any other. He blames the war on oil, but not for the typical "secure oil supplies" rationale. The danger was if sanctions were lifted, Saddam would make oil too cheap. If tight oil supplies was the goal, an Iraq plagued by violence and thus unable to export oil is a feature not a bug.

    "The five oil giants saw profits rise from $34 billion in 2002 to $81 billion in 2004, year two of Iraq’s “transition to democracy.”

    But this tsunami of black ink was nothing compared to the wave of $113 billion in profits to come in 2005: $13.6 billion for Conoco, $14.1 billion for Chevron and the Mother of All Earnings, Exxon’s $36.1 billion...

    When OPEC raises the price of crude, Big Oil makes out big time. The oil majors are not simply passive resellers of OPEC production. In OPEC nations, they have “profit sharing agreements” (PSAs) that give the companies a direct slice of the higher price charged.

    More important, the industry has its own reserves whose value is attached, like a suckerfish, to OPEC’s price targets. Here’s a statistic you won’t see on Army recruitment posters: The rise in the price of oil after the first three years of the war boosted the value of the reserves of ExxonMobil Oil alone by just over $666 billion."
    http://www.gregpalast.com/big-oil-and-the-trillion-dollar-war-bonus/

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  16. The only explanation I've heard of why we are in Iraq that makes any sense is in Victory and Recruitment by Michael Neumann. This wasn't the work of evil geniuses but incompetents.

    By the way Steve, my post on the upside of diversity reducing trust is up and your ideas feature rather prominently in it.

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  17. I think is to deflect (either consciously or unconsciously) the growing awareness that it was about Israel, not oil.

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  18. Greenspan is clearly off base about the threat from Saddam, but it is refreshing to hear someone talk about the need to protect our supply of oil as a valid reason for war. Of course it's valid for a country to go to war to protect its economy if the threat is real and serious. And yet, no one - right or left - will speak the truth on this point. I wish Greenspan had spoken publicly about this in 2002; at least then we could have had an honest debate about how important oil is to our society (answer: very important and worth protecting) and also whether Saddam was a threat to the oil supply (answer: probably not a serious enough one to justify war).

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  19. Seriously, I think the war's been a disaster, but that doesn't mean Saddam didn't present a certain type of threat. He showed his undeterability in GWI and GWII I think by not backing down from certain threats.

    Setbacks in Iraq, however, do not counsel the US to abandon the entire logic of preemption. Volatile Islamic regimes with nuclear bombs present a real challenge. They may pass off these weapons to third parties with plausible deniability, which would prevent the US from retaliating. These countries show a greater taste for war than Europeans (including the Soviets), as evidenced by the nearly disastrous Indo-Pakistani standoff in 2002 and the eight year Iran-Iraq War.

    If they can be developed, nuclear weapons would insulate these regimes from retaliation for supporting terrorist groups and for other assaults upon our regional interests. We could not have instituted regime change in Iraq if it had nuclear weapons. The US and Iraq’s neighbors likely would have been at Iraq’s mercy, for example, if a nuclear-armed Iraq invaded Kuwait. It would be Hungary 1956 revisited, but this time in the Middle East.

    I simply don't buy that he wasn't a threat considering the piss-poor conventional militaries of his neighbors.

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  20. An excellent post, Steve. Why can't others see so clearly? Beats me.

    BTW, what about Iran? They are already on the straights of Hormuz. Does that mean Teran really is a strategic threat? Could they (the mullahs) close the straights if they decided to? For how long? If this would cause economic chaos in the West, as Greenspan says it would, isn't that a better deterrent than nuclear weapons themselves? Or would they be equally afraid to exercise either option? I'd love to get your thoughts on the prospects here.

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  21. Good grief. I am deeply, profoundly, weary of the defense of this asinine war. Yes, of course it was about oil (and throwing non-Israeli troops into doing the bidding of Zionists) but more fundamentally, it was/is about money.

    They want to keep oil prices high, so they bring on one mid-east "scare" after another, so that the oil companies that are so disproportionately represented in the Bush administration can gorge on profits. War also gives the administration to dole out pallet-load of $100 bills to friends and family, plundering the US Treasury for the gluttony of the self-presumed aristocracy. The plan has long been in the works, to transfer the wealth of the nation to a small elite, to destroy the middle class, to recreate a slave class and ultimately, to put a price on everything, from a handful of water cupped from a brook to each breath we take. All of this will be added up and we'll be forced to labor at any pace they choose, for as many hours a day they choose, for the right to live.

    Sounds dramatic, doesn't it. Sounds crazy too. But then again, if I'd told you 10 years ago that what is happening today would happen, you would've laughed me out of the room, all the while, making snide comments about my sanity. And so it goes...

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  22. It's always better to seize the initiative than just sit back waiting to get hit.

    So you agree that paranoids are not always wrong to be suspicious of bigtime Jewish machers at the Royal Court of Washington?

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  23. roach: You're saying that if Iran handed off a nuke to, say, Hizbolah, which then set it off in New York, that "plausible deniability" would protect Iran? And you base this on, say, our unwillingness to invade Afghanistan when Al Qaida attacked us?

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  24. Luke says:

    "BTW, what about Iran? They are already on the straights of Hormuz."

    Yes, clearly, the Greenspanian logic demonstrates once and for all that the only logical path for America to follow is world conquest. We must run any risk to be safe!

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  25. beowulf: "The danger was if sanctions were lifted, Saddam would make oil too cheap. If tight oil supplies was the goal, an Iraq plagued by violence and thus unable to export oil is a feature not a bug."

    This hits the nail on the head. The oil companies, who have large offices all over D.C. even though there is no oil anywhere near D.C., love high oil prices and love to whip up (through their proxies like the American Enterprise Institute) the trouble that creates high oil prices. The same effect occurred during the 1970s and the first Gulf War.

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  26. Analyzing Greenspan's comments at face value is a complete waste of time. The same goes for the first post in this comments section. Obviously, both Greenspan and Anonymous are Jews trying to rationalize the fact that they support perceived Israeli interests ahead of American interests. Whether these Jews actually understand Israeli interests is highly debatable.

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  27. Analyzing Greenspan's comments at face value is a complete waste of time.

    Agreed. Greenspan is a master bullshitter. Perhaps that's the major qualification for Fed Chief. His theory on Hormuz is more foggy pap.

    And daveg is right about the squid ink 5000 KIA stats from Omaha Beach in WW2. Hello? We own the skies in the Persian Gulf. And when you own skies over desert terrain you completely own that theatre of war (traditional war that is). Anyone government that tries to take control over shipping in the Middle East is going to get pounded into dust by the USA. That is the military reality. All the players in the region understand this. That's why they don't make any attempt.

    Actually we proved in Serbia that owning the skies over non-desert terrain is now nearly as devestating (at least for weaker regimes) due to the technological advances in precision bombing. I didn't agree with that war. Steve should start blogging about the mischief that is brewing over there again.

    Anyway Greenspan's Hormuz hot air is designed for US media consumption. His BS might have had something to do with reality in 1990 before the first gulf war. But Greenspan implemented the Hormuz red herring as motivation for Bush in 2002 after Saddam was castrated. After our demonstration of military power in Gulf War I there was and remains no state in the Middle East plotting a takeover of Persian Gulf shipping.

    Our neocon regime keeps telling us that Iran is "crazy" enough to do anything. These are the same administration yoyos who never considered that Saddaam was bluffing about his weapons capabilities in order to intimidate his own neighbors.

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  28. Left gatekeepers propagated the myth the war was bout oil. The truth is zionists like Greenspan have dragged the West into The Middle East conflict on Israel’s side, on the back of a series of false flag terror attacks in the West blamed on ‘Muslim Terror’. Thats the truth. Thats why you don’t hear it.

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  29. You know when you feign throwing a tennis ball for your dog to fetch and your dog starts looking out on the lawn for it? That's what these comments remind me of. Way not to keep your eye on the ball, folks.

    Iraq is a red herring for Greenspan: he had zero to do with the decision to war with Iraq, this time or last. So why did he bring it up, knowing that neocon-obsessives and other Iraq War opponents would latch on to these comments? Because he'd rather people talk about that, than the unfolding disaster for which he does bear some responsibility: the unfolding credit crisis and real estate recession.

    Greenspan is taking a lot of heat now from business journalists who claim his keeping rates low in the wake of the tech bubble irresponsibly inflated the housing bubble. Now Greenspan's successor Bernanke is going back to the play book, lowering rates to clean up the mess of the burst housing bubble, but he will be constrained by the weakness of the dollar, which is now at an all-time low versus the Euro and has been getting hammered against metals and other currencies. What better way for Greenspan to sidestep this growing threat to his legacy than with a non sequitur about Iraq?

    As far as Sailer's original question of how smart Greenspan is, it's almost impossible to tell. He has mastered an impenetrable way of speaking ("Greenspeak") in which it's difficult to find any falsifiable statements.

    To Sailer's broader point about the alleged lack of intelligence among high officials in Washington, I'm not sure this is the case. As I wrote in the last Cochran thread:

    "Cochran is clearly prejudiced against government officials, assuming they are in government because they are too stupid and innumerate to do other work. Is this true though? And is it even relevant? Off the top of my head I can think of a couple of super-smart, highly-numerate former officials who didn't seem to do great jobs in government: John Deutch (Clinton's DCI, chemistry professor at MIT); Paul Wolfowitz (Deputy Defense Sec., double majored in math and chemistry at Cornell before getting Ph.D. in Poli Sci from Yale)."

    I'd also add that the last few Treasury Secretaries have certainly been intelligent men capable of doing other things outside of government: Paulson, the former CEO of Goldman Sachs; Snow, former Railroad CEO, economics Ph.D.; O'Neil, former Alcoa CEO; Summers, Harvard tenure at age 28.

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  30. However immature and stupid Ayn Rand may have been, she held power in libertarian circles; maintaining the relationship by publicly repudiating Rand's boyfriend may have simply been astute politics on Greenspan's part, partly contributing to his eventual appointment by Reagan.

    Greenspan made an astute choice in the 90s not to raise interest rates when many or most economists would have based on unemployment levels and other Taylor rule factors. With economic outcomes for several hundred million people in the balance, his unconventional but correct stance required a level of insight, independent judgement, and self confidence that would exclude him from Randall Parker's government hack category, in my estimation.

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  31. Greenspan was on NPR's "Fresh Air" the other day, and the substance of his remarks was this: "Forget the cost of the Iraq war ($2 trillion or so). That has little or no negative effect on the economy. What's important is: in a few years, Medicare and the prescription drug part will be bankrupt, and I'll have to pay full price!!"

    Now he didn't exactly say "I'll have to pay full price." He said "people like me" will have to pay full price. That's the most important problem in the world in his mind, while the cost of Iraq is insignificant.

    Greenspan is in his dotage now, blurting out his childish self-interested concerns as worthy of center stage.

    And yes, his "Iraq was about oil" line (seemingly a shocking concession to some of the views of Chomsky, et. al.) is a feint.

    We are all beginning to see that America is simply a source of cash and cannon fodder for Israel and its wars.

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  32. David,

    The war in Iraq is running about $120 billion per year and will end at some point. Medicare was about $400 billion per year and increases at twice the rate of inflation. Medicaid costs another $250 billion+ per year.

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  33. david:

    I rather suspect Greenspan is right that the economic impact of the Iraq screwup will be smaller than the economic impact of Social Security and Medicare + demographics.

    everyone:

    There's no reason to think Greenspan's competence would extend to analyzing military threats. Similarly, I imagine my cardiologist would do a lousy job rewiring my house. Intelligence is important, but so is expertise and experience.

    Further, I suspect that Greenspan deserves some credit for not screwing things up too badly, but mostly gets to take the credit for good results produced by a really strong economy, over which he had little influence.

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