How to Keep the War From Starting

It is clear that the United States will invade Iraq within the next few days. Jockeying for position in the United Nations Security Council may delay things a bit, as would a decision by Turkey to take another vote regarding the use of Turkey as a base by American troops. But the war is going to take place.

The war needn’t take place. It could be stopped by a few phone calls. Let me describe the scenario of peace.

The senior decision-makers of the Saud family call an emergency meeting. They meet together in private, discuss the situation, and gain agreement to issue this statement:

Upon the invasion of Iraq by the United States,

The nation of Saudi Arabia will withdraw all of its deposits in American banks. These deposits will not be transferred to commercial banks in those nations that vote with the United States in the Security Council. Saudi Arabia will henceforth sell oil for euros. Dollars will no longer be accepted.

The head of the Saudi central bank would then call the head of the Bank for International Settlements in Basle. He tells the BIS’s senior representative that this statement will be issued to the wire services within three hours unless the Saudi head of state hears from President Bush personally, assuring him that the troops will begin being removed from Kuwait within two days. The BIS is also told that if American troops should leave the compound where they are stationed in Saudi Arabia, the statement will be released to the wire services immediately, and the withdrawal of Saudi funds will begin.

Within 30 minutes Alan Greenspan would call President Bush and explain things to him. Eddie George would call Tony Blair at the same time.

If the Saudi head of state gets no phone call from Mr. Bush, he then issues the statement to the news wire services. Simultaneously with this announcement, the Saudi foreign minister begins calling the heads of all other oil-exporting Middle Eastern nations to line up joint support. Also, the head of the Saudi central bank begins calling the heads of all other Arab central banks, starting with the oil-exporters. The callers will remind the listeners of the probable consequences of a TV broadcast on al-Jazeera regarding those heads of state that refused to cooperate with Saudi Arabia in challenging the invasion of an Arab country. The words “Serbian Prime Minister” will be used discreetly.

By the third phone call, the dollar would be lock-limit down in America’s domestic currency futures markets. The margin calls would go out.

If the other oil-exporting Arab nations (excluding Kuwait and possibly Qatar) were then to issue their own statements to this effect, by the end of the day, Colin Powell would be holding a press conference praising the progress that Hans Blix’s UN inspection team has accomplished so far, and denying any suggestion that his reversal of opinion has anything to do with the fact that the dollar was down against the euro by 15% for the day in foreign markets.

For my scenario to work, there would have to be cooperation within the Arab League. But the phrase, “Arab League,” has been the supreme political oxymoron of the last eighty years. The rival clans that make up the Arab League agree only on one thing: the Palestinians inside their borders must eventually return to Palestine.

This war is about oil. It’s also about the international value of the dollar. Iraq a year ago began selling oil only for euros. Had the other Middle Eastern oil-exporting states followed suit, there would be no war clouds today.

All of this is obvious, or should be. But people refuse to discuss the obvious in public. What is obvious is that individual oil-exporting Arab nations are acting as income-seeking individuals, not as members of a regional cartel that has the ultimate lever of power in international markets. In a world that runs on oil, Arab politicians are in it only for the money. Some of them are named in honor of Muhammed, but not one of them thinks the way he did. He understood strategy. They don’t.

The day that America invades Iraq, the Friends of Osama will figure this out, once and for all. The pace of recruiting will escalate. Their targets will include the existing power structure of the oil-exporting Arab nations.

What happened in Serbia on March 12 is a taste of things to come. The Friends of Osama will become the region’s 800-pound guerilla.

Meanwhile, back in the Security Council. . . .


It’s time to review a little history. The United Nations Organization (UNO), better known as the UN, was granted the right to use the name of the anti-Nazi military alliance. The United Nations, 1942—45, were a loosely associated federation of military powers, not a single bureaucratic entity. The term “United Nations” was a valuable asset, one which carried legitimacy in the eyes of the victors. The decision by the heads of state of the original United Nations to allow the phrase to be transferred to the UNO involved a major transfer of legitimacy.

In 1945, four of the five nations that had been the primary targets of the Axis powers — The United States, the Soviet Union, Great Britain, France — had been pre-war empires. The fifth nation, China, had lost its status as an empire. The Big Four had controlled nations and ethnic groups outside their geographical borders.

The war’s losers had also been empires. There was in 1945 a crucial question as to which of the victorious empires would maintain control over their existing domains, plus pick up the domains of the losers. Japan had sought to expropriate the British and Dutch in Southeast Asia. The Soviet Union had appropriated half of Poland and the three Baltic states during its treaty period with Nazi Germany (1939—41). Who would pick up the vanquished empires’ pieces? Who would drop its pre-war pieces?

In 1945, the victorious empires divvied up the defeated empires’ land holdings with the same enthusiasm that they divvied up Middle Eastern oil after 1945.

None of the victors in 1945 was about to allow the UNO’s General Assembly to replace them as the decision-makers of the world. They knew that these nations would resist the control of one or more of the four empires that now controlled the post-war world. This is why the five major powers transferred control over the decision to authorize wars to the Security Council. They retained for themselves permanent membership on the Council, and each of them retained a veto over the Council, which meant the UNO in matters of war.

This is why the General Assembly is not consulted in matters of war and peace. The General Assembly is the UNO in its capacity as a growing conglomeration of independent nations, now at 191 members. It is more like the United Tribes. It is the third world’s official welfare distribution center. (Just for the record, the Bush Administration got Congress to pay $60 million to UNESCO last year, so that America could re-join that liberal UNO agency, which the Reagan Administration had wisely abandoned in 1984 — a move which that liberal, pinko cad, Clinton, had refused to do.) But the big boys, who now possess nuclear weapons, are not about to hand over to the fuzzy-wuzzies the right to say whose nation gets invaded legitimately and whose doesn’t.

There is no doubt that the Soviet Union demanded the veto as the price of its participation. Stalin was not about to surrender to the West the crucial political asset of military legitimacy.

The Soviet Union feared the influence of the United States in the Security Council. The Security Council in turn feared the General Assembly. The existence of the veto, possessed solely by the victors, has been the crucial emblem of meaningful multi-national sovereignty in a swelling sea of meaningless national sovereignties.

The reason why the UNO went to war in 1950 in Korea was because the USSR was conveniently boycotting the Security Council when its ally and surrogate, North Korea, crossed the 38th Parallel. It did not exercise the veto over the Security Council’s decision to back up the United States in defending South Korea. It told North Korea and the United States, “Let’s you and him fight.”

Then, as soon as the vote was taken, the Soviet Union re-joined the Security Council and continued to use its veto to make sure that the UNO would not produce a peninsula-wide victory for South Korea. This stalemate established the legitimacy of North Korea, which ironically has outlived the Soviet Union. Prior to the war, the North Koreans had refused to allow UNO inspectors in to monitor elections, and therefore the UNO had called into question the legitimacy of Kim Il Sung’s regime. That opposition ended in 1953, when the cease fire (there has never been a peace treaty) was signed.


Aging souls like myself, who were educated in a school system that actually required courses in modern European history, were subjected in high school to textbooks and film strips that told the story of Japan’s walk-out of the League of Nations in 1933, matched by a walkout by Italy in 1937. In each case, the departing nation was pursuing its own plan of empire. The League of Nations condemned these acts of naked aggression, but to no effect. It had no sanctions. The moral lesson, according to our instructors: “A toothless League of Nations revealed the inability of world government without the force of arms.” In short, we students were all supposed to embrace the UNO, the Security Council, and the transfer of both national sovereignty and nuclear weapons to the UNO.

The reaction of most of us to this propaganda barrage was the reaction of General McAuliffe at Bastogne, when the Germans demanded his surrender: “Nuts.” (I regard that statement as the most profound one-word military assessment in the history of warfare.) But the one-worlders had a point: no bombs — no authority. Legitimacy, maybe; authority, no.

President Bush has been running up his long-distance phone bill trying to persuade, bribe, threaten, embarrass, or otherwise cajole the support of a majority of nine members of the Security Council. Tony Blair says that he will soon submit another resolution to the Security Council.

Of course, nobody says anything about the General Assembly, which would vote against this war overwhelmingly if given the opportunity. Everyone knows what the outcome of that vote would be, so the United States ignores the General Assembly, mankind’s “voice of democracy.”

What about that international voice of the people? What about majority rule? Representatives of the veto-holding nations would never say in public what they have always believed: “Buncha wogs.” So, there is no world democracy. There is only the Security Council. The veto in the Security Council is at the heart of liberalism’s process of identifying an illegitimate war, 1945—2003.

It is worth noting that the member nation that has exercised the veto most often is the United States, which has used it 76 times, 35 in defense of the state of Israel. The Soviet Union used it 118 times. That nation is now gone. The Russian Confederation has used it twice, and one of these was to veto any suggestion that the Security Council renounce the veto. The United Kingdom has used it 32 times, France 18 times, and China five times.

Bush and Blair are trying to transform nine votes on the Security Council into a substitute for legitimacy. They know the French will veto the war. They think the Russians will, too. But they are running up those phone bills for the purchase of an ersatz fig leaf of what has always been ersatz legitimacy: the ersatz legitimacy of the Security Council to speak on behalf of the world.

But as for a majority of the 191 members of the General Assembly — where the USSR had three votes in the good old days (USSR, Byelorussia, Ukraine) — Bush and Blair say nothing.

This politicking for votes is all about empire. It was all about empire when Japan and Italy walked out in the 1930’s. It was all about empire back in 1945, when the veto was handed out to the victors.

So, it’s fig leaf time. Any fig leaf will do in a sand storm. Nobody mentions the substantive issue, namely, whether one nation or any group of nations has the moral authority to invade a sovereign nation that has been at peace for a dozen years, and which went to war back then only after having been given a green light by its supplier of weapons, agricultural aid, and money: the United States, i.e., the July 23, 1990, meeting between Saddam Hussein and America’s Ambassador, April Glaspie.

The President’s timetable is being imposed by the weather, not by compelling issues of international law. It is about sand, not the moral high ground.

The oil-exporting Arabs could pull the plug on this war in a matter of hours. This would take only a few phone calls and a strategy of economic resistance. But they won’t do it. They prefer to wring their hands in public — “What can we poor, weak Arabs do?” — mainly for the benefit of their domestic populations. They much prefer to live in luxury with their oil revenues denominated in dollars. When it’s a question of the honor of Islam vs. a new Lexus, there is no hesitation.

This is not unknown to the Arab in the street.

America is about to light the fuse.


President Bush has warned the United Nations Organization that any refusal by the Security Council to join with this nation in its invasion of Iraq will undermine the legitimacy of the United Nations. Can you imagine General Tojo or Mussolini announcing to the League of Nations, “If the League does not back us in our decision to invade, it will lose all legitimacy”? Would anyone have taken such an announcement seriously?

The members of the General Assembly know what is going on. They have known since 1945. Almost three-fourths of these member nations became sovereign states after 1945. Many of them are the heirs of geographical entities that were controlled by the pre-war empires that now exercise the right of the veto. They know exactly what the veto represents: Bwana Nuke. They all want in on the deal. That’s because Bwana Nuke has a veto, whether a member of the Security Council or not.

These people are not blind. Ask them this question: “What’s the #1 difference between Kim Jong-il and Saddam Hussein?” Answer: “Kim Jong-il really does possess weapons of mass destruction.”

Kim Jong-il has issued a series of announcements to the United States, which all boil down to the same thing: “Kiss my critical mass.” He finds that he is dealing with Scarlett O’Hara: “Well, fiddle-dee-dee. I’ll think about it tomorrow.”

The United Nations cannot stop an American invasion of Iraq. Nevertheless, there is a liberal-awarded halo of moral legitimacy attached to the UNO. Somehow, all good people are supposed to worry what the UNO does or doesn’t do. We old-time conservatives have never been taken in by any of this, but the liberal textbook writers and film-strip creators got their message across to their successors back in my high school days. Therefore, Mr. Bush is running up the phone bill.

The Bush Administration is now caught in a web spun by two generations of liberal foreign policy. The Administration thinks that it has to play the UNO game. Because it is playing the game, it persists in the great myth, namely, that the Security Council in some way speaks for the General Will of the world. Americans are still trying to get the rotting corpse of Jean Jacques Rousseau off our backs, he of General Will fame. Jacques Chirac now has the legal authority to shut the mouth of the General Will. Like it or not, the General Will must honor the veto. George Bush won’t.

When American troops cross the borders of Iraq, in the eyes of the world, or at least the General Assembly, the United States will forfeit legitimacy. What the third world has murmured in the shadows for decades will become the basic foreign policy position of the dispossessed: “The United States is an aggressor nation.”

The United States cannot be stopped by conventional weapons or conventional politics. It can be stopped only by the Arab oil-exporting clans, whose senior representatives are too greedy and too gutless to stop this war. Bush’s action will, overnight, baptize the use of unconventional weapons.

The United States will soon find itself on the wrong side of the great strategic debate. The debate I’m speaking of is the debate that now goes on in the third world. The debate is basically this: “How long will we have to take orders from these people?” Kim Jong-il has supplied the correct answer: “Until we have weapons of mass destruction.”

We have MOAB: the Mother of All Bombs. We have tested it in Florida, to the cheers of anti-ecologists around the nation. But there is a far worse bomb: the aerosol bomb.


This brings me back to the story I have mentioned from time to time for a decade. My friend, Dr. Arthur Robinson, is a chemist by training and a biochemist by profession. He and I wrote a book promoting civil defense back in 1986, Fighting Chance. He has said publicly that a terrorist with a Ph.D. in biology, assisted by a pair of M.A.-level biologists, could create weapons-grade anthrax in less than two years. The cost? If purchased retail, the equipment would cost $250,000; used: $25,000. In aerosol form, he says, a person could kill up to 90% of the population of New York City if the wind was blowing right. This weapon could be concealed in a mini-van, released into the air by anthrax-immunized terrorists, who would have 24 hours to escape before the deaths would begin.

Relentlessly, capitalism keeps lowering the costs of production. It will get cheaper and cheaper for a terrorist group to do this — not once or twice, but repeatedly, in cities across America or around the world.

Have you ever heard the phrase, “the technological imperative”? Here is the technological imperative: “If it can be done, it must be done.” It will be done.

Bwana Nuke will be replaced by Bwana Bug. When you have Bwana Bug in aerosol cans, you can tell the rest of the world to take a hike.

What do you think would happen to the economy of the West after the third release of anthrax in (say) New York City, Los Angeles, and London’s banking district (the City)? Explain to me how the derivatives network ($130 trillion of interconnected short-term debts, held mainly by money-center banks) will work then.

Urban voters and retirement fund investors reassure themselves: “It can’t happen here!” In my day, we called this “whistling past the graveyard.”


Whatever the decision of the Security Council, America will invade Iraq. There are old family scores to settle, old oil wells to commandeer. But the costs of this war for Americans will be higher than any war in American history. With this war, we will send a message to the General Assembly: “Imitate Saddam, and you get invaded. Imitate Kim Jong-il, and you get deference.”

American foreign policy is officially based on an assumption: “Weapons of mass destruction require an expensive, traceable infrastructure that only a nation-state can finance.” Yet it is also officially based on the opposite assumption: “Saddam Hussein has hidden all of his weapons of mass destruction, which are untraceable, thereby requiring a military invasion of Iraq.”

Here is my assumption: “Capitalism will lower the cost of production of biological weapons of mass destruction.”

Economics teaches that when the price of anything is reduced, more is demanded.

March 15, 2003

Gary North is the author of Mises on Money. Visit For a free subscription to Gary North’s twice-weekly economics newsletter, click here.

Copyright © 2003