Archive for the Oil consumption Category

US-China Summit: China Policy in Disarray [Sinomania!]

Posted in Beijing, China, China-US relations, Corporate Media Critique, Currency wars, Hillary Clinton, Iraq, Kuwait, Media smear campaign, Oil consumption, Pentagon, Saudi Arabia, State Department, US imperialism, USA, Western nations' human rights distortions, Yuan appreciation on February 9, 2011 by Zuo Shou / 左手

January 18, 2011

by Ben Chalmes

WASHINGTON, DC — On the 20th anniversary of the fist Gulf War crisis Chinese President Hu Jintao arrived today for a state visit.  Chinese flags fluttered across the cold American capital as the usual China gatekeepers pontificated in print and airwaves about the need for China to be "responsible" and the importance of the stale policy concerns of Washington toward Beijing.

America’s China policy is bereft of innovation and woefully outdated. Now defined by both State and Treasury Departments neither Tim Geithner nor Hillary Clinton offer anything new.  Geithner continues to stress currency an issue where he knows the USA has no high ground (the USA is as much a currency "manipulator" as China or Japan or the EU) and Geithner knows full well the USA will never get China to budge on Yuan appreciation.  As for State Hillary Clinton trotted out human rights concerns that sounded like leftovers from her time at the UN Conference on Women in Beijing.  China’s human rights record hinders investment she says.  Really?  Yet China remains the world’s top destination for foreign direct investment.

The reason the unacknowledged anniversary of Gulf War I is important is because both nations are dependent on the steady flow of Persian Gulf oil – China even more so than the USA.  In January 1991 China came out in full support of Kuwait and the rhetoric behind the air strikes against Saddam Hussein.  Only a few months earlier in July 1990 Beijing established relations with Saudi Arabia and the quest was on for oil contracts Chinese leaders knew the country would soon need.  By 1993 China became a net oil importer.  Around the same time US oil imports grew faster as domestic production peaked and began a steady decline.  Yet there is no talk of "peak oil" or the resource competition underway between our two nations – the world’s top two energy users and polluters.

Meanwhile in the background the Pentagon and its friends in the Anglo-American media beat the war drums with scary stories about missile gaps (China’s "carrier killer" missiles may make our 12 Navy aircraft carrier groups obsolete!) and Chinese planes that might achieve 1980s level technology.

So can we expect more of the same stupid discourse on China in the 2012 election cycle?  Unless something different emerges from this week’s meetings I fear we will again kick China policy and our need for cooperation further down the road to mutual destruction.

Article link: sinomania.blogspot.com  –  Archives (January 2011)

U.S. climate scientist calls China ‘hope of the world’ [Workers World]

Posted in Alternative Energy, Anti-China propaganda exposure, Capitalism crisis early 21st century, China, China-bashing, CPC, Energy, Environmental protection, Germany, Obama, Oil consumption, Science, U.K., USA, WTO on February 1, 2011 by Zuo Shou / 左手

~ As Washington sues Beijing over green subsidies ~

Published Jan 26, 2011 4:09 PM

A leading U.S. scientist who deals with global warming and climate change is calling the People’s Republic of China “the best hope” for turning around a looming disaster for the world and “stopping rule by fossil fuel interests.”

Dr. James Hansen, head of NASA’s Goddard Institute for Space Studies in New York, also wrote in the South China Morning Post on Nov. 3, “Fossil fuel interests reign in Washington and other capitals.  Big money forces legislatures to hatch ineffectual schemes such as ‘cap-and-trade-with-offsets,’ a system designed by big banks and fossil fuel interests that assures continued fossil fuel addiction.”  The South China Morning Post is an English-language daily published in Hong Kong.

China last year became the world’s largest emitter of greenhouse gases on an annual basis, exceeding the U.S. for the first time.  So why is it the world’s “best hope”?  Hansen says, “China leads the world in clean energy investments — nuclear, wind and solar power.”

China is also forging ahead with new technology to improve energy efficiency during the generation and transmission of electricity.

China’s biggest energy source — and biggest problem — is coal, which generates 80 percent of its electricity.  Its abundance has fueled China’s industrial revolution.  It has also contributed to air pollution inside China and to greenhouse gases in the world’s atmosphere.

However, since 2006 it has closed down many inefficient and dangerous small coal mines, cutting annual coal consumption by about 82 million tons and annual carbon dioxide emissions by some 165 million tons.

Most CO2 came from Britain

It takes many years for the impact of greenhouse gases to be felt. The blanket of CO2 and other greenhouse gases now warming Earth ha s been accumulating since the 19th century. Hansen says the largest portion of these gases was generated by Britain, where the industrial revolution in the West started.  Germany is second.  It is followed by the U.S., with responsibility for 27 percent, and China, with only 9.5 percent of the total.

Even looking just at current emissions, China, with its very large population, produces far fewer emissions per capita than any other industrialized country, even though it has now become the “factory to the world.”

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War and the Global Economic Crisis: Blame America’s War Economy rather than China [Socialist Project / Globalresearch.ca]

Posted in Anti-China media bias, Anti-China propaganda exposure, Canada, Capitalism crisis early 21st century, China, China-bashing, China-US relations, Early 21st Century global capitalist financial crisis' US origins, Economic crisis & decline, Media smear campaign, Nukes, Oil consumption, Pentagon, Pentagon, US "War on Terror", US imperialism, USA, USA 21st Century Cold War, Yuan appreciation on December 28, 2010 by Zuo Shou / 左手

December 23, 2010

by Paul Kellogg

There is a growing chorus of voices in the media and the academy singling out the actions of the Chinese state as central to the dilemmas of the world economy. This focus finds its most articulate presentations, not in the xenophobia of the right, but in the polite analysis of many left-liberals.

Nobel Laureate economist Paul Krugman, for instance, writing in the run-up to November’s G20 summit in South Korea, praised the United States’ approach of creating money out of nothing (“quantitative easing”) as being helpful to the world economy, and criticized the Chinese state’s attempts to keep its currency weak as being harmful. “The policies of these two nations are not at all equivalent,” he argues, adding his influential voice to the chorus which is increasingly targeting China for the world’s woes.[1] Krugman’s, however, is a simplistic analysis which overlooks the role of the U.S. over decades in creating huge imbalances in the world economy, and has the dangerous effect of scapegoating one of the poorest nations of the world (China) for the problems created by the world’s richest.

Krugman’s argument proceeds through a sleight of hand. He objects to the attempts by the Chinese state to keep down the value of its currency – the yuan – as a series of policies whose “overall effect…on foreign economies is clearly negative.” This is a common theme – China’s “weak-yuan” currency being good for China (making its exports cheaper in world markets) and bad for the rest of the world.

~ Intents and Effects ~

But there is a problem. By Krugman’s own admission, the U.S. policy of creating money out of nothing will result in a “weaker American dollar.” What he doesn’t say, but what is implicit in his analysis, is that this U.S. policy is identical to China’s – a “weak-yuan” policy in the latter, matched by a weak-dollar policy in the former. Krugman nonetheless lets the U.S. off the hook because, he argues, even though the U.S. dollar is certain to fall in value as a result of the new trillions being created, “that is not the ultimate goal.”

Judging a policy on its intent rather than its effect is disingenuous…

…However, let’s take Krugman at face value. Why does he see the U.S. policy as good for the world? Because, he argues, “basically, the United States is pursuing a policy that increases overall world demand” and China “is pursuing a contractionary domestic monetary policy, reducing overall world demand.”

Let’s begin with some of the key facts. At the peak of the economic crisis, the United States, Canada and the European Union had to borrow hundreds of billions of dollars from the rest of the world to finance stimulus programs to stabilize their economies. China also engaged in serious fiscal stimulus (relative to GDP, virtually on the same scale as the United States)[2], but unlike the North American and European powers, it was able to do so without borrowing a penny from the rest of the world.[3]

One of the reasons the U.S. had to resort to large-scale foreign borrowing, was because of years of high levels of central government deficit spending. [A chart is referred to at this point…]

Because the United States central government had been running very large deficits for years, borrowing on a large scale was inevitable to do the very necessary work of trying to “stimulate” the economy at the peak of the crisis in 2009. But with these deficits pushing debt levels very high very quickly, there has been increasing nervousness about both deficits and debts getting out of hand. Enter “quantitative easing.” As an alternative to creating more government debt, the world’s most powerful economy can, for the moment, simply “create more money,” push it into the economy and hope that this has the desired stimulus effect.

Krugman assesses the merits of these actions solely on their effect on world demand. But is this a sufficient criteria? There are all sorts of policies pursued by the U.S. over generations which have increased overall world demand. One in particular comes to mind. The U.S. central government has for a long time been the center of military expenditure in the world, and its role as such is accelerating. In 1990, its military expenditures represented 36.19 per cent of the military expenditures in the entire world. By 2009, its military expenditures had grown to fully 44.13 per cent of world military expenditures. In other words, almost half of the money spent on war in the world is spent by the U.S. state.

This huge infrastructure of planes, missiles, bases, tanks, guns, ammunition and personnel has a powerful effect on demand in the world economy. For instance, “the U.S. military is the single largest consumer of energy in the world.”[5] This might be bad in terms of global warming [sic]. Nonetheless, gobbling up millions of barrels of oil certainly helps stimulate world demand for petroleum. The trillions spent on war and militarism do meet Krugman’s criterion in that they “stimulate world demand.” But they do so in perverse ways. In particular, they are the principal reason for the desperate fiscal weakness of the U.S. central government, documented above, fiscal weakness which is driving the move to quantitative easing.

~ Three Deficit Scenarios ~

Let’s try on three different scenarios to examine the relationship between military expenditures and U.S. deficits. Begin with one aspect of arms spending: the “war on terror.” Launched in 2001, it has had three components – Operation Enduring Freedom (the war in Afghanistan), Operation Iraqi Freedom (the war in Iraq) and Operation Noble Eagle (beefing up U.S. military bases and homeland security). The official bill to-date for this “war on terror” is almost identical to the amount of money created in the first round of quantitative easing – $1.1-trillion.[6]

This is probably an understatement, perhaps a gross understatement. Joseph Stiglitz and Linda Bilmes estimate that the true cost of the war in Iraq alone will be in excess of $3-trillion.[7] However, for argument’s sake, we will take the official figures. If those official figures are removed from the books (Scenario 1 [referring to a chart in original article]) – that is, if we see what the picture would be like had the “war on terror” not been launched – then a change begins to take place in the picture of U.S. deficit spending. It doesn’t eliminate the deficit problem. But it does lessen it, to the extent that as late as 2007 – the year the financial crisis first revealed itself – the U.S. central government would have actually run a modest surplus.

But the “war on terror” is just the tip of the iceberg. The United States, as documented above, spends money on the military at a rate far greater than any country in the world. In 2010, for instance, the War on Terror costs of $130-billion were dwarfed by the $534-billion spent on other aspects of the military. Since 2006, the total “defense” budget of the U.S. has been over half a trillion dollars. By 2011, it is projected to be closing in on three quarters of a trillion dollars.

Now imagine a pacifistic instead of a militaristic United States. In other words, see what the picture would be like without sustaining this massive war machine. When this military spending is removed (Scenario 2, [referring to a chart in original article]), the picture of the U.S. central government budget is completely different.

In 2009 and 2010, there are, of course, quite large deficits. This is the normal “Keynesian” turn to deficit spending that occurs in any economic downturn. What is remarkable however, is the fact that in terms of non-military spending, before 2009 and 2010, there would have been no deficit whatsoever. In fact, in many years, there would have been surpluses, twice (in 2000 and 2007) touching half a trillion dollars.

With a budget history for the last 20 years resembling this graph, a pacifistic U.S. government could have spent billions on its stimulus package, without borrowing a dime. Stimulus could have been completely financed out of accumulated surpluses from the last 20 years.

And in fact, this understates the situation. Many of the costs of the U.S. bloated war budget are hidden. It would take a team of forensic accountants with unlimited time and unlimited funds to sort through government finances and corporate balance sheets to tease out the actual costs of sustaining the world’s biggest military, and the world’s only truly global empire.

But there are two “non-defense” line items that we can say with certainty are directly related to the U.S. military. Veterans Affairs spending is extremely high in the U.S. precisely because so many young people have come back maimed and broken through U.S. military adventures abroad. And the space program is a barely disguised excuse to develop and test the rocket technology that is the backbone of the U.S. nuclear arsenal. When these two are factored in (Scenario 3 [referring to a chart in original article]), the picture is breathtakingly clear.

The U.S. central government deficit problem has one source – addiction to war and empire. That addiction has led to borrowing on an unprecedented scale, making it impossible for the U.S. to stimulate its economy through accumulated savings and making it increasingly nervous about the accelerating practice of borrowing on a mass scale. The quantitative easing approach – creating money out of nothing – has been made inevitable by the massive deficits used to sustain empire abroad.

~ What Kind of Stimulus? ~

Return, then, to Krugman’s argument. If we only have one criterion by which to assess this – the creation of demand in the world economy – then there is no problem here. Massive levels of arms spending create demand. Years and years of arms-related U.S. budget deficits do “stimulate” the world economy. But downing two or three pots of coffee in one setting will similarly “stimulate” a person’s metabolism. That doesn’t mean it is a recommended method by which to obtain our nutrition.

Obviously “the creation of demand” is not the only criteria we should use. When trillions are spent, it is useful to us ordinary folk when these trillions are spent in productive ways – on homes for the homeless, on child care, on health care, on education, on infrastructure, on subways, on clean energy, on water purification in the Global South – the list is endless.

But when the trillions are wasted on grenades, nuclear weapons, M-16 rifles, nuclear submarines, aircraft carriers and all the other paraphernalia of the U.S. killing machine – this is ultimately the equivalent of taking those trillions and flushing them down the toilet. It is “investment” which leaves nothing behind – except nuclear waste that future generations will have to dispose of, deadly munitions that will exist for generations to maim and kill peasants in the field, and broken bodies and minds chewed up in endless wars. The creation of “demand” is not the only criteria. It matters – and it matters desperately – exactly what kind of “demand” we are feeding.

And think this through. This creation of money from nothing will systematically drive the U.S. dollar lower relative to other currencies. For those holding billions (and in some cases trillions) of U.S. dollar-denominated debt, the devaluation of the U.S. dollar means a devaluation of the worth of their holdings. In effect, the United States through quantitative easing is forcing the rest of the world to pay for its empire – to pay for the costs it has incurred through sustaining a bloated permanent arms economy.

It is irresponsible to assess the value of the policies of the U.S. and Chinese governments by narrowly focusing in on momentary decisions related to their currencies, and by pretending that these policies happen in a vacuum. There is a history to the current predicament of the United States, a predicament of its own making. When put in this bigger context, the message that must be sent to Krugman and others making similar arguments is quite clear: blame the wars, not China. •

Paul Kellogg maintains a blog at PolEconAnalys.org where this article was originally published.

[Edited by Zuo Shou 左手]

Full article, with charts and footnotes: http://www.globalresearch.ca/index.php?context=va&aid=22494

Who Actually Owns BP? [Globalresearch.ca]

Posted in BP oil spill, Deepwater Horizon, Oil consumption, Pentagon, US "War on Terror", US Government Cover-up, USA on August 23, 2010 by Zuo Shou / 左手

by Rand Clifford

August 22, 2010

Most relevant sources agree that 40% of the shares of BP are held in the United Kingdom, 39% of the shares are held in the United States, while the remaining 21% are held throughout Europe and the rest of the world.  The largest single holder of shares is getting harder to track down.  Generally an Internet search will lead to the other 9 leaders, roughly 23%:

BlackRock (New York) 5.9%
Legal & General (United Kingdom) 4%
Barclays Global Investor (owned by BlackRock) 3.8%
Norges Bank Investment Management (Norway) 1.8%
Kuwait Investment Authority (manages funds for the Kuwaiti Government) 1.75%
M & G Investment Management (UK asset owned by the Prudential) 1.67%
Standard Life (Scottish insurance company) 1.5%
Capital Research & Management Company (Los Angeles) 1.3%
China’s State Administration of Foreign Exchange 1.1%

Too many sites fail to mention who owns a whopping 28.34% of BP—more than the other 9 out of the top 10 together. That would be Wall Street’s JPMorgan Chase.  And that certainly explains why our own [sic] government has offered mostly limp and phony bluster and coverup as BP has done pretty much whatever it wants in our new energy sacrifice zone—such as the deliberate blockage of oil collection in favor of bringing in “Carolina Skiffs” and huge aircraft to spray dispersants at night.  BP lies, our government lies and covers, and the Gulf dies.  Evidently, our government’s top priority is limiting BP’s liability.

Nalco is the company that manufactures Corexit dispersant which, despite being banned in the UK because of its toxicity, has been used by the millions of gallons in the Gulf.  Corexit has been approved by our EPA—but only for surface use.  Well, the EPA illegally issued a permit for BP to inject Corexit at the gushing well head.  BP even admitted they used Corexit illegally.  They made an enormous catastrophe even much worse by polluting the Gulf with Corexit. Injecting Corexit right at the well head, they created massive plumes of dispersed oil that float around below the surface, killing life in the Gulf for…long enough.  That’s what energy sacrifice zones are for; BP greatly reduced its liability by killing the Gulf.  Our government tried to convince us that “most” of the oil is miraculously gone—that only 24% remains!  Who would have imagined that our own CorpoMedia would be the one to nix that fairy tale, actually telling the truth that 80% of the oil is still in the Gulf, floating around in those dispersed, biocidal plumes?  When CorpoMedia controverts CorpoGov, it’s obvious that something extraordinary is up.  It’s called goodbye to life in the Gulf of Mexico.  There’s a lot of oil and gas down there, and all the Gulf’s biology is in the way.

What “Size of People” Are You?

Preliminary work involved in transforming the Gulf of Mexico into an energy sacrifice zone has given BP executives ample opportunity to prove that their mouths are big enough to hold both feet.  They have not disappointed.  Who can forget CEO Tony Hayward in that sleazy infomercial about how much BP cared—that BP would “…make things right”?  It was like Corexit spraying from every TV in America.  And of course there was his whining about wanting his life back as he dallied off to a yacht race in UK waters.  But perhaps the most telling gaffe came from the Swedish mouth of BP Chairman Carl-Henric Svanberg, right after his meeting with Obama.  Svanberg used the term “small people” to refer to those damaged by BP’s catastrophe-magnified-with-Corexit.  Once wasn’t enough, he used it 3 times; the first time saying that President Obama was “…frustrated, because he cares about the small people”, then he noted that “We at BP care about the small people”, concluding with how much BP “…cares about the small people”.  Of course he abjectly apologized later for speaking “clumsily”, but, hey, Carl-Henric, it’s the thought that counts.

So, yes, unfettered capitalism has replaced the sanctity of human life with different “sizes” depending on the amount of moneypower one commands.  The vast and rapidly growing majority of us are “small people”.  From there upward, transparency falls off precipitously, so it’s progressively more difficult identifying larger sizes—but there’s no stopping conjecture.  Perhaps the mediums include our political class, those doing to the smalls what they are told to do.  Most millionaires probably belong in this group, maybe even Carl-Henric Svanberg himself.  In the large size are the billionaires, as well as many of those behind blacked-out windows being chauffeured to annual Bilderberg meetings. Beyond the large, secrecy becomes so profound it’s like lying on the bottom of a stream and trying to spot airplanes cruising by at 40,000 feet.  In the X-large and XX-large sizes are surely those who make the final decisions about wars, depressions, and the major energy sacrifice zones.  Top multi-national corporations are up in this zone.  And it’s a safe bet that anyone or anything this high probably ascended on the power of fossil fuels.  In 2010, 3 of the 5 largest corporations in the world are: #2, Royal Dutch Shell; #3, Exxon Mobil; #4, BP.

The Actual Costs of Fossil Fuels

This is another realm where transparency gets muddied by secrecy, indirection and lies. But when you start factoring in oil wars, and wars over transfer routes (both currently disguised as wars on terror), you quickly transcend the cost of all the “economically unfeasible” clean and renewable energy sources such as solar, wind, ocean wave, biomass…. Then when you consider things such as pollution… fossil energy becomes—perhaps with climate change—terminally expensive.  And then there’s the social damage of extreme wealth concentration, and attendant commodification and stratification of human life (the different sizes, just like shirts), along with the rapidly growing assembly of energy sacrifice zones—…could any energy be more expensive?  It seems the answer is no.

Yet we drill and fracture and bulldoze maniacally in our quest to wring out remaining oil, natural gas, and coal…  The answer to the question WHY? would be just another cost of fossil fuel.

The medium, large, X-large and XX-large have proven they will do anything to perpetuate the system that has given them their size.   Meanwhile, it appears the only salvation for the vast bulk of humanity, along with most of Earth’s species, is in the hands of the small people.  We vastly outnumber all other sizes put together, and that leads to one of the scariest questions of all:  Just how small are we?

Rand’s novels CASTLING, a “Story of the Power of Hemp”…and, TIMING, the sequel…are published by StarChief Press.

Article link here

The Big Picture: Why Is It So Hard to Stop the Oil Gusher, and Why Was Such Extreme Deepwater Drilling Allowed in the First Place? [Washington’s Blog]

Posted in BP oil spill, Deepwater Horizon, Environmental disaster, International Action Center, Oil consumption, Pentagon, US "War on Terror", US foreign occupation, US imperialism with tags , , , , on May 26, 2010 by Zuo Shou / 左手

This is indeed “The Big Picture” of the BP Deepwater Horizon oil catastophe.  Essentially, it gets to the heart of the hellish alliance of the Pentagon and private oil megacorporations.  The Pentagon consumes more oil per day than the vast majority of countries on the planet.  The US government (and their corporate symbiotes) need to control oil…so they go to war against those who have it and won’t give it up…causing deep, criminal harm to both humanity and environments domestic and foreign…consuming more oil in the process…creating a need for more oil…so they go to war…repeat.  Also a nod to my friend and inspiration Sara Flounders, who is quoted in the article.  -左手

“The government failed to properly ensure that BP used adequate safety measures, BP and their contractors were criminally negligent for the oil spill, and BP has tried to cover up the problem. See this.

 But why hasn’t BP stopped the leak?

 Some people assume that BP hasn’t stopped the oil leak because it’s people are wholly incompetent.

 Others have asked whether BP’s $75 million liability cap is motivating it to stall by taking half-hearted measures until it’s relief well drilling is complete.

 But there is another possible explanation: the geology – as well the deepwater pressures – at the drilling site makes stopping the leak more difficult than we realize.

Does the Geology of the Spill Zone Make It Harder to Stop the Oil Spill?

 We can’t understand the big picture behind the Gulf oil spill unless we know the underwater geology of the seabed and the underlying rocks.

 For example, if there is solid rock beneath the leaking pipes, with channels leading to various underground chambers, then it might be possible to seal the leaking risers and blowout preventer, with the oil flowing somewhere harmless under the floor of the ocean.

 On the other hand, if there are hundreds of feet of sand or mud beneath the leaking pipes, then sealing the spill zone might not work, as the high-pressure oil flow (more than 2,000 pounds per square inch) might just shoot out into the water somewhere else.

 We don’t know the geology under the spill site. BP has never publicly released geological cross-sections of the seabed and underlying rock. BP’s Initial Exploration Plan refers to “structure contour maps” and “geological cross sections”, but all detailed geological information, maps and drawings have been designated “proprietary information” by BP, and have been kept under wraps…

 

Oil Is Considered A National Security Issue

 So why are oil companies being allowed to drill so deeply under the Gulf in the first place? In other words, why has the government been so supportive of deepwater drilling in the Gulf?

 The answer – as Anderson and Boulanger note – is that there is a tremendous amount of more oil deep under the Gulf, and that the United States government considers oil drilling in the deep waters of the Gulf as a national security priority:

 The oil and gas industry and the United States government both face tremendous challenges to explore discover, appraise, develop, and exploit vast new hydrocarbon reserves in waters deeper than 6000 feet in the ultra-deepwater of the Gulf of Mexico. Yet these new reserves of hydrocarbons are needed to offset the economically detrimental, long-term decline in production from within the borders of the United States

***

If successfully developed, the new play concept would fill an essential gap in the overall strategic defenses of the United States by decreasing the gap that results in the nation’s dependence on foreign oil and gas reserves in this volatile and hostile, post 9/11 world. However, the successful production of oil and gas from this new carbonate play concept requires much more cost-efficient evaluation and appraisal technologies than exist today to economically conduct exploration, appraisal, and development activities. These new technologies must be developed before production can be practical in the ultra-deepwater operating environment…. The Ultra-Deepwater and Unconventional Gas Trust Fund of the DOE has as its mission to cut costs and time-to-market not incrementally, but radically, so that the United States can optimally utilize these strategic hydrocarbon reserves. The DOE, with extensive industry,academic and non-governmental assistance, developed an Offshore Technology Roadmap …,

***

The U. S. Energy Bill of 2002 has allocated significant resources to fund innovative industry, academic, and national laboratory research initiatives to develop the new technologies necessary to explore and produce these new ultra-deepwater reserves economically. The purpose is not only to impact the national defense, but also to regain our international technological leadership in the deepwater, recently lost to the Brazilians, Norwegians, and Europeans.

***

Congress, never a big friend to energy interests [sic], has acted to create the Ultra-deepwater Trust Fund that would add an astounding $200 billion by 2017, if successful at developing the new production technologies required.

 So the Department of Energy and Congress have committed to development of the deepwater Gulf oil reserves in the name of national security. This also helps explain why Obama has been pro-drilling in the Gulf.

 But let’s take a step back and ask why the government considers oil a national security priority in the first place.

 Well, as professor of national security affairs at the Naval War College Mackubin T. Owens writes:

 The concern of these lawmakers [regarding the BP oil spill] is understandable, but lest they overreact, they need to place their valid concerns within the broader context of the nation’s economic health and energy security.

 ***

 Americans currently consume about 22 million barrels of oil daily, of which about two-thirds is imported. The Department of Energy’s Energy Information Administration (EIA) expects imports to reach 70% by 2025. This means we send billions of dollars abroad in payment for foreign oil. This makes little sense when, according to the U.S. Minerals Management Service (MMS), there are vast reserves of oil and gas beneath Federal lands and coastal waters. And it is likely that even these estimates are low. For instance, in 1987, MMS estimated that there were 9 billion barrels of oil in the Gulf of Mexico. By 2007, once drilling had begun in deeper waters, MMS had revised its estimate upward to 45 billion.

 In addition, the U.S. military is the largest consumer of oil in the world. And the government is eager to ensure that the military maintains access to oil.

 As NPR reported in 2007:

 All the U.S. tanks, planes and ships guzzle 340,000 barrels of oil a day, making the American military the single-largest purchaser and consumer of oil in the world.

 If the Defense Department were a country, it would rank about 38th in the world for oil consumption, right behind the Philippines.

 As Reuters pointed out in 2008:

 U.S. military fuel consumption dwarfs energy demand in many countries around the world, adding up to nearly double the fuel use in Ireland and 20 times more than that of Iceland, according to the U.S. Department of Energy.

 And as I summarized last year:

 Sara Flounders writes:

 By every measure, the Pentagon is the largest institutional user of petroleum products and energy in general. Yet the Pentagon has a blanket exemption in all international climate agreements.

 ***

 The Feb. 17, 2007, Energy Bulletin detailed the oil consumption just for the Pentagon’s aircraft, ships, ground vehicles and facilities that made it the single-largest oil consumer in the world.

 ***

 Even according to rankings in the 2006 CIA World Factbook, only 35 countries (out of 210 in the world) consume more oil per day than the Pentagon.

 ***

 As I pointed out out last week:

 Professor Michael Klare noted in 2007:

 Sixteen gallons of oil. That’s how much the average American soldier in Iraq and Afghanistan consumes on a daily basis — either directly, through the use of Humvees, tanks, trucks, and helicopters, or indirectly, by calling in air strikes. Multiply this figure by 162,000 soldiers in Iraq, 24,000 in Afghanistan, and 30,000 in the surrounding region (including sailors aboard U.S. warships in the Persian Gulf) and you arrive at approximately 3.5 million gallons of oil: the dailypetroleum tab for U.S. combat operations in the Middle East war zone.

 And in 2008, Oil Change International released a report showing that [b]etween March 2003 and October 2007 the US military in Iraq purchased more than 4 billion gallons of fuel from the Defense Energy Support Center, the agency responsible for procuring and supplying petroleum products to the Department of Defense.

Indeed, Alan GreenspanJohn McCainGeorge W. BushSarah Palin, a high-level National Security Council officer and others all say that the Iraq war was really about oil.

Nobel prize winning economist Joseph Stiglitz says that the Iraq war alone will cost$3-5 trillion dollars.

And economist Anita Dancs writes:

 Each year, our military devotes substantial resources to securing access to and safeguarding the transportation of oil and other energy sources. I estimate that we will pay $90 billion this year to secure oil. If spending on the Iraq War is included, the total rises to $166 billion.

 

Are you starting to get the picture?…

existing national [US] policy is to do whatever is necessary – drilling deep under the Gulf and launching our military abroad – to secure oil.”

Article link here