President Bush has issued a call for more oil production, which isn't necessarily a free-market position but only seems like one given the huge number of restrictions on the market now that inhibit production. A truly free economy would generate as much marketable oil as was economically necessary: no more, no less (over time). The correct energy policy is: allow the market to work.
To what lengths will the Bush administration, which everyone knows is the muscle end of the domestic oil industry, go to pursue its desire for more production? To war, perhaps? Plenty of dissidents out there doubt that the overthrow of the Taliban and the war on terror generally are about justice for terrorists and security for the Americans. Rather, like the War on Iraq before it, this war is really about securing the profits of American oil companies doing business internationally.
Actually, that position is not a stretch. The State doesn't usually tell the truth about its own motivations. The State doesn't say: "send us your taxes so that we can enhance our power and pass out dough to our friends." Instead, it says: "taxes are the price you pay for civilization." In the same way, most people understand that the sloganeering of politicians is just eyewash to cover up the desire to get reelected, and that bureaucrats are mainly interested in their own jobs and pay.
It's the same in foreign policy. Even when there seems to be a good excuse for going to war (9/11), it's always mixed up with ulterior motives. In the overthrow of the Taliban and the installation of a puppet government in Afghanistan, you don't have to resort to far-flung tales of conspiracy to find evidence of mixed motives.
CNN openly reports that in the mid 1990s, Unocol had been working the Taliban, Pakistan, and Turkmenistan on a pipeline deal before political instability scuttled the deal. US companies have invested some $700 million in a pipeline in the region so far, but Afghanistan is crucial if the oil and natural gas is going to be moved to the right markets. The Taliban proved uncooperative and unable to provide political stability. Thus the new regime has brightened the hopes of international energy corporations that stand to benefit.
In fact, you don't have to go to CNN. You can read the Department of Energy's own report on Afghanistan from September 2001:
"Afghanistan's significance from an energy standpoint stems from its geographical position as a potential transit route for oil and natural gas exports from Central Asia to the Arabian Sea. This potential includes the possible construction of oil and natural gas export pipelines through Afghanistan, which was under serious consideration in the mid-1990s. The idea has since been undermined by Afghanistan's instability. Since 1996, most of Afghanistan has been controlled by the Taliban movement, which the United States does not recognize as the government of Afghanistan"
(By the way, this kind of research is no longer difficult. Finding those two links took about 2 seconds with Google.com and the right search terms.)
Even a casual look at the facts raises questions about the usual rationale. The Bush administration said it was necessary to overthrow the Taliban because it was sheltering Bin Laden, who had been secretly behind the attacks of 9/11. And yet the hijackers were mostly from Saudi Arabia, a brutal and unelected regime but a US ally that has inexplicably escaped all blame in the aftermath. For that matter, the hijackers spent more time training in the United States than anywhere else. And even after the war, Bin Laden remains at large.
There are plenty of questions remaining, and tens of thousands of words could be spilled trying to demonstrate the connection between an industrial special interest and the war on terrorism. Let's just say that you have generated enough evidence to stand up in a court of law. Would it change any minds? Would the writers at National Review say: "Hey, we've been hoodwinked! This war is really about oil! Pull the troops out! Peace in our time!"
Of course not. National Review would quickly retort that it is necessary for a great power like the U.S. to protect its interests using the military; primary among those interests are the economic ones, particularly as they affect some vital commodity like oil.. As James Baker said during the Gulf War, there were three reasons for the attack on Iraq: "Jobs, jobs, jobs." This damning admission didn't change minds. It reinforced positions. The warmongers at the time said, "See? It's not just about Iraq's disputed borders. This war is also essential to our economic well-being!"
The school of thought that believes economic and military power are mutually reinforcing is found on the left and right today. Thomas Friedman's book The Lexus and the Olive Tree may appear to be a journalist's account of the glories of globalization. Actually, there's a theory at work here: he believes that McDonald's couldn't operate in 100 countries if McDonnell-Douglas weren't also there, and seeks to make the argument that war and commerce are a glorious fit.
This is a fallacy and a lie. Commerce doesn't require militarism. It is the opposite of militarism: it is mutual exchange based on mutual benefit and peaceful human interaction. Say what you will about militarism, it is not about peace or mutual benefit. When war is necessary, said Mises, it is always to be regretted precisely because it is the enemy of enterprise and civilization.
But the confusion is evident even in the way we talk about these subjects. We use the word "globalism" without specifying whether we mean free trade or empire. We decry "isolation" while deliberately obscuring whether we mean a non-interventionist foreign policy or protectionism. The party of liberty loves trade and hates empire, favors non-intervention but decries protection.
Where does that leave us? With a rich heritage of libertarian dissidents, for starters. An extremely important article by Joseph Stromberg in the Journal of Libertarian Studies ("The Role of State Monopoly Capitalism in the American Empire") examines the connection between war and commerce and shows that the divisions between the left-right imperialists and the party of liberty have always been with us. Moreover, he shows that government and certain strains of the business sector have long cooperated to bring about wars to their mutual benefit.
From the elimination of the wonderful Articles of Confederation, to the creation of the Constitution by an elite business class, to the drive to consolidate federal domination of the South by Northern industrial interests, to the attack on Spain and the invasion of the Philippines, and onto the myriad interventions in the 20th century, the hand of well-connected industrial giants seeking profits the easy way has been there the entire way.
The left has long argued that the structure of capitalism requires militarism to support it, and without a clear theory of economics, one can see how a person would be tempted to this view. In fact, imperialism represents a complete betrayal of free enterprise.
Stromberg offers the best definition of imperialism I've seen: "the outcome of an interaction between the permanent state apparatus and individuals or interest groups bent on exploiting productive societies." He closes with this revealing comment by Wilhelm Röpke:
It is therefore frequently possible to prove that in individual cases "economic" factors play a part in an aggressive foreign policy, when private groups understand how to make use of their national government for their own purposes, or the true economic interests of the nation as a whole are falsely depicted. It is shown over and over again, however, how little these examples go to prove that the prevailing economic system of necessity and by reason of its intrinsic structure results in an aggressive foreign policy.... The idea that the economic system which rests upon the regulating function of the market and the separation of political sovereignty from economic activity is that which compulsorily drives nations to war, must be completely rejected." (International Order and Economic Integration, 1959)
If Unocol believes it can make a buck delivering oil and natural gas through Afghanistan, let the company buy off local warlords to guard the pipelines. If that doesn't work, the company bears the risk. But don't send America's sons and daughters to do it, or, if you do, have the decency not to claim that they are doing their patriotic duty.
February 27, 2002
Copyright © 2002 Mises Institute