In Slate / Washington Post, Anne Applebaum writes:
In Russia one widespread conspiracy theory holds that the Soviet Union was somehow “forced” to collapse because Ronald Reagan covertly engineered a drop in global oil prices in the 1980s. It seems laughable to imagine that any American administration could ever have done anything so clever on purpose.
I don't know if that conspiracy theory is true or not, but lots of Reagan Administration officials have boasted of a conspiracy between the U.S. and Saudi Arabia to boost production to lower oil prices in 1986 to damage the Soviets.
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46 comments:
Who cares. No nation is entitled to a specific world commodity price. The only way to lower prices is to increase supply, and lower prices plus increased supply is good for every consumer in the world.
The US used to makes its money the old fashioned way - allow its citizens freedom and they will better everyone by bettering themselves.
"Jawboning" was the buzzword.
Anne Applebaum
I know, it's wrong to notice things. Very, very, wrong. And evil too!
The interesting thing about this one is that it exposes Appelbaum's motive.
The USSR as a vast petrostate. It would be hard to get an American journalist to report the USSR's vast oil reserves in normal stories. Here she directly gives an alternative reason for the Cold War itself (resources) and the unholy alliance of USA patriot Judeo-Christians and Wahabi Sauds that fought the Soviets in Central Asia.
Careful there Anne you are filing your hand there...
The ONLY way to lower prices is to increase supply
Well, the only way except for that one other way, which is to lower demand.
Lower demand being, in a nutshell, the reason why we had the financial meltdown in 2008: We finally ran out of Late-Baby-Boom Whites who could actually afford the balloon payments on their $500,000 McMansions.
So we tried to substitute Blacks and Mexicans in their place, and then when the balloon payments came due, the entire world financial system collapsed.
The Dismal Science has yet to come to grips with the catastrophic consequences of long-term demographically-induced structural price deflation.
In the meantime, since all of us here in the Dark Enlightenment are in-the-know as to the terrifying maelstrom which is lurking just beyond the horizon: PURCHASE EVEN MORE AMMUNITION.
Wait wait wait... Was WW2 about oil? Would that be a conspiracy theory of some sort? Hitler Goes East as a bid for oil? Say it ain't so Appellbaum, ww2 must have been about existential evil instead!
Is Applebaum being fashionably stupid, or is she just lying?
We Civilization gamers tend to see ideology as excuse. The real deal is the struggle for resources and the domination of trade routes.
Of course it's true, the USSR and the Free World waged incessant economic warfare against each other, and tried to hurt each other in any way possible. This is neither crazy nor a scandal. It's not like the USSR didn't have a lot of Active Measures going against the West, as well. They didn't call it the Cold WAR for nothin' Annie. What the Hell is the matter with people today?
How is this a conspiracy theory? I remember watching a documentary with ex-Reagan officials bragging about this.
When the white women stopped popping out white kids in large enough numbers the system collapsed. And I'm just talking about the Soviet Union here.
Simples.
Don't forget Margaret Thatcher specifically turned the spigots to full open on the Brent oilfields to help out her good friend Ronnie and to stick to the Russkies.
In the late eighties I could by a gallon of gas just over the Indiana border a few miles from the Whiting Oil Refinery for under a buck.
I remember reading about this in all places the New York Review of Books in the mid nineties. But hell I guess the TWMNBN like Dear Anne here have never heard of that publication.
"I don't know if that conspiracy theory is true or not, but lots of Reagan Administration officials have boasted of a conspiracy between the U.S. and Saudi Arabia to boost production to lower oil prices in 1986 to damage the Soviets."
Yeah, I was always under the impression that that was one of the cleverer things that the US did during the Cold War.....
Mackinder's Last Hurrah!:"The interesting thing about this one is that it exposes Appelbaum's motive."
Only one? I can detect several.
"The USSR as a vast petrostate."
It's even more of a petro-state under Putin. Frankly, Russia today is nothing more than a Third World resource extraction economy.
" It would be hard to get an American journalist to report the USSR's vast oil reserves in normal stories."
Really? I can recall reading tons of stories during the Cold War about the USSR's oil reserves...
" Here she directly gives an alternative reason for the Cold War itself (resources)"
Aren't resources always a reason for going to war? Is this news to anyone?
" and the unholy alliance of USA patriot Judeo-Christians and Wahabi Sauds that fought the Soviets in Central Asia."
Again, one of several reasons. Things are very seldom mono-causal
"It seems laughable to imagine that any American administration could ever have done anything so clever on purpose."
Only a President routinely disparaged as stupid by The Left could ever have done anything so clever on purpose. Mind you, W was also disparaged as stupid and indeed doesn't seem ever to have done anything remotely intelligent in office, so the correlation doesn't always stand up.
Macinder:"Wait wait wait... Was WW2 about oil?"
Among many other things, yeah.
"Would that be a conspiracy theory of some sort?"
No.
"Hitler Goes East as a bid for oil?"
He went East for a lot of reasons.And natural resources was one of them.
"Say it ain't so Appellbaum, ww2 must have been about existential evil instead!"
Does anybody ever go to war because of "existential evil?" Had Hitler just killed a bunch of people in Germany, no one would have cared. A salutary lesson to dictators. You can kill as many of your own people as you want.
http://independentfilmnewsandmedia.com/proof-the-american-press-is-dishonest-oreilly-slams-media-for-failure-to-cover-benghazi-memo-video/#comment-98638
It's 2014. The MSM's job nowadays seems to goad us into being shocked,shocked about what was shrug-inducing only a few decades ago.
So who exactly is behind the domestic opposition to exporting US LNG?
Two can and do play that game. The KGB/FSB have a history of funding anti-energy groups in the US and in Europe - not saying that Senator Markey (D-MA) is on the take - but he has long been a useful idiot - and is not a vocal opponent of LNG exports.
Ms. Applebaum's expertise is politics and Poland. Energy economics is not exactly her cup of tea.
Is it really a conspiracy if you make public announcements?
Ronald Reagan used a little utilized management technique - the short list. He was incredibly effective because he only tried to do a few things that he thought were important. One of these was to bring down the USSR.
This was never a secret.
Early in his administration the liberal media raked him over the coals for being stupid and out of touch. They ran with this story about how when he visiting some Midwest city he was introduced to a black man whom he greeted with the words, "Good morning Mr. Mayor". But it wasn't the local mayor. It was his own Secretary of HUD. He didn't recognize one of his own cabinet members.
The press took that as evidence that he was stupid if not senile. But they were wrong. It was actually an insight into how he was so effective.
The Secretary of HUD is an irrelevancy. It's a sinecure given usually to some loyal black supporter. Quick, who's the current HUD Secretary?
Reagan only concentrated on a handful of issues. Maybe being old he realized that he wasn't going to be able to do everything he would like to in the time left to him. He also had the example of the foolish Jimmy Carter who tortured himself with trying to memorize every detail in his voluminous 'briefing books'.
If an issue wasn't on his short list he delegated it to someone else. He made time for destroying the Soviet Union.
Patrick Boyle
>We Civilization gamers tend to see ideology as excuse. The real deal is the struggle for resources and the domination of trade routes.<
That struggle explains only a part of what goes on. Chance accounts for the other .0001%.
This may have been an instance where coordinated government action could have brought down oil supplies. Supply was artificially high after the 70s due to cartelization by OPEC, so Saudi Arabia letting production ramp up to the market equilibrium completely changed the picture.
Today's high oil prices probably could not be changed so easily by coordinated action. There isn't as much excess supply that could be switched on.
Side note: The Soviet Union seemed like a big success story to Western journalists in the 1920s and 1930s because high commodity prices spurred incredible economic growth rates.
This made many westerners believe Communism was a superior ideology, but all it really proved is that there are so many random variables that influence economic growth that government policy is a tiny eddy in a vast current. That never gets in the way of top-down development schemes by politicians to increase homeownership, invent new energy sources like biofuels or hydrogen fuel cells, Obamacare, Head Start, foreign aid, etc.
Does she offer some alternative theory of Soviet collapse? US-engineered low oil prices and a fear that the US might get SDI to work is the standard story of the proximate cause of the collapse, isn't it?
She's been on a roll lately, though. Check out the bizarre farrago of lies which constitutes her last few contributions to Slate. Praising the peaceful Nazis of Kiev and everything.
Doesn't she kinda look like Ayn Rand? About as rational, too.
"We Civilization gamers tend to see ideology as excuse. The real deal is the struggle for resources and the domination of trade routes."
And you're completely wrong because it's almost always cheaper to buy resources than to fight for them.
If not the oil glut, if not the USSR overreaching in Afghanistan, it would have been something else. Empires based on ideological cults are untenable, the only thing is which particular spark brings about their decline.
I'm not just talking about the old Soviet Union, either.
In the mid-'80s oil glut, while leaded gas was still available, it could be had for as low as 59 cents a gallon in St. Louis.
So, the Russians are implying that the Soviet Union would have survived if the USA did not lower oil prices through increasing output?
it's hard to see how that would have been in the saudi's interests, but yes, saudi output directly affects global price and has small to moderate effects on all kinds of stuff.
this is the main reason (among several) that the cultural marxist's initial plan back in march, to hurt russia by flooding the global market with US oil from the SPR, made no sense at all. the saudis would simply reduce output by an equal amount, to maintain price.
i would guess this is the reason obama went to saudi arabia last month, to try to talk them out of that. they pretty obviously told him to shove it. his trip didn't last long.
"Is Applebaum being fashionably stupid, or is she just lying?"
She just doesn't like 'anti-American canards', especially as her ilk now control America.
You see, America does everything straight.
We really did go into Iraq to create a new democracy.
Nuland was only vacationing in Ukraine.
Applebaum the neocon said she voted for Obama cuz she couldn't take Palin seriously. But Palin sucks up to such neocons.
American Cons are the most pathetic fools in the world.
Just take open borders.
The Jewish logic according to Abe Foxman.
"You white conservatives are racist for opposing open borders and massive migration from Mexico. We hate you for that. But, Mexicans are very antisemitic, and we Jews have a problem with that. So, we expect you white conservatives to stick up for us against all those nasty Mexicans."
So, Jews insult whites as 'racist xenophobes' for opposing massive influx from Mexico but then demand that whites do something about all those nasty 'antisemitic' Mexicans who don't like Jews too much.
I mean how much of this crap can we take?
Applebaum writes: A European Union thinking strategically about its future would create an energy union, as some have already suggested, and begin to bargain collectively for its gas.
"Some" like the Foreign Minister of Poland.
the number one thing that could be done to sink oil would be to bring back restrictive covenants.
Two reasons Anne Applebaum would have said this:
1)She knows this did happen and she's lying to us and the Russians.
2) She doesn't know this happened but she's so incapable of imagining the Russians might have a point on anything that she never bothered to research it.
My guess is the second is true.
"It seems laughable" is the giveaway.
Reagan continued the Carter deregulation policies. Carter deregulated airlines causing a collapse in ticket prices and the destruction of airline pilots pension and retirement plans. Reagan deregulated the petroleum industry. He was not nearly as thrifty as Carter but he did not print money as fast as possible. He also raised taxes quite a bit(*)
So petroleum deregulation coupled with moderation in money printing, and increased taxes lowered the cost of things like gold and oil prices. Fed Chairman Volker, originally a Carter appointment was permitted to raise interest rates.
FWIW the Carter deregulation of the airline industry was mostly undone by the Bush II creation of the TSA.
* Reagan raised social security taxes making it impossible for low income people to save for say a down payment on a house. He also created the Alternative Minimum Tax, which rich people whinge about. So the seeds of the mortgage meltdown were sown by Reagan making it impossible for low income people to save for a down payment or college or anything else.
@Chubby Ape:
Two reasons Anne Applebaum would have said this:
1)She knows this did happen and she's lying to us and the Russians.
2) She doesn't know this happened but she's so incapable of imagining the Russians might have a point on anything that she never bothered to research it.
My guess is the second is true.
+1
I think she's very well informed. The neocons are playing for keeps. Fromo Wiki: Applebaum married Polish Foreign Minister Radosław Sikorski in 1992Anne Applebaum-Sikorska became a Polish citizen in 2013.
from wiki
"A predecessor "minimum tax", enacted in 1969, imposed an additional tax on certain tax benefits for certain taxpayers. The present AMT was enacted in 1982 and limits tax benefits from a variety of deductions"
It's not exactly a state secret that the U.S. and the Saudis worked together to lower oil prices to economically break the USSR during the Reagan administration. It had to be one of the least well kept "secrets" of all time.
Victory by Peter Schweizer, one of the first wave of books about the Reagan Adminstration and its role in ending the Cold War, devotes a great deal of time to the subject.
http://www.amazon.com/Victory-Administrations-Strategy-Hastened-Collapse/dp/0871136333
Wasn't the oil flood beginning in Oct 85 the Saudis retaking control of OPEC by finally "opening the spigots" as they had far so long threatened?
It only (long term) benefitted the Saudis. Only the Saudis could afford it(it was terribly expensive). And the Soviet Union was an innocent bystander.
"Wait wait wait... Was WW2 about oil?"
It was definitely about oil for the Japanese. They had to seize the oil in Indonesia (then Dutch East Indies) or else. The US imposed an oil embargo on the Japanese and well, that was that:
"Responding to continuing Japanese aggression in China, the U.S. froze Japanese assets... ...established an embargo on oil and gasoline exports to Japan. The oil embargo was an especially strong response because oil was Japan's most crucial import, and more than 80 percent of Japan's oil at the time came from the United States."
Anne Applebaum = the fevered imagination of the Polish govt.
Shouldn't she have to register as a foreign govt. lobbyist?
I mean, pillow talk counts, doesn't it?
The Iran-Iraq war of the 1980s had more to do with the collapse of oil prices in 1985/6, than anything Reagan might have cooked up.
If you can recall, both nations locked into a pointless and fruitless war of attrition needed to raise cash fast, so 'bang' went OPEC's carefully crafted and rigidly enforced quotas.
Also if you're old enough, cast your minds back to that terrible and blighted decade. It started off with the Iranian revolution. Oil prices sky-rocketed as a consequence, higher in real terms than the 1973 debacle, (which itself caused immeasurable damage), sparking off massive inflation and a following industrial depression in the west.
1980 was they year that Paul Volcker squeezed the life out of the US economy. The early '80s were a terrible time of mass uunemployment and falling GDP throughout the west. This natural reaction caused oil demand to collapse, the price collapse, helped by Iran/Iraq over production followed. What happened was that the OPEC cartel basically broke down as nation states pursued their own selfish interest and cheated on quotas. OPEC f*cked itself up by getting too greedy. They killed the goose that laid golden eggs and consequently had no one to sell their surplus oil too.
"So who exactly is behind the domestic opposition to exporting US LNG?"
the US is a natural gas importer. so that should put an end to the discussion right there. you can't export when you are a net importer.
but if somebody wanted to take it further, what it would mean is packaging all the US natural gas and shipping it all the way to ukraine. if they did the math, they would realize that by the time that stuff got to ukraine, it would be a least twice as expensive as the stuff coming out of russia. economics kill the plan.
then you get into, that whole system of NG transport from the US to eastern europe would not even be ready for years.
"pat said...
Early in his administration the liberal media raked him over the coals for being stupid and out of touch."
It is pretty obvious from just listening to Reagan speak that he was not stupid. Or, at least, even stupid people were smarter back then. Reagan actually spoke in complete sentences, expressed coherent thoughts, and made logical arguments. He spoke better than does any contemporary American politician of either party. Public discourse has been reduced to the level of late-night talk-shows and reality televsion.
Of course it's true, the USSR and the Free World waged incessant economic warfare against each other, and tried to hurt each other in any way possible.
So, we fluoridated all that grain we sold them?
Jody,
Current natural gas imports and exports are cross-borders affairs between Canada and Mexico with substantial imports from Alberta to the West Coast, especially California. We export some to Mexican border states as a matter of convenience.
The US Energy Information Agency predicts net US exports by 2016:
http://www.eia.gov/forecasts/aeo/er/early_production.cfm
"It was definitely about oil for the Japanese. They had to seize the oil in Indonesia (then Dutch East Indies) or else."
Japan got too greedy for its size and power. US was willing to let it keep Manchuria, which is a HUGE piece of turf.
Japanese just got greedy. US did the right thing.
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