Roots
Terrorism as we know it today has its roots in the era of the Cold War. At the close of World War II, the political paradigm amongst nations was one of war and global conquest. Also, at that time, a deadly, new weapon had made its appearance on the scene - the atom bomb.
The Cold War
It was clear to every nation that whoever had supremacy of nuclear arsenal would win the next world war. And there were two nations that led the race - the USA and the USSR. It was extremely important to both these nations that it was ahead in the race.
During the 1950s and 1960s, both the USA and the USSR increased their stockpile of nuclear weapons, amassing warheads, building intercontinental ballistic missiles, building anti-missile technology and so forth. The arms race was on.
But the arms race was clandestine. No one knew how far ahead or behind they were of their competitor. There was considerable paranoia in the minds of the US public about the imminent threat of nuclear attack by the Russians. This paranoia (possibly cultivated, possibly real) allowed governments to spend large parts of their state budgets on getting ahead in the arms race and building defenses.
For example, the internet was born out of this effort - the problem being solved (for which the internet was the solution) was this: how can we build a computer systems communications infrastructure which will not fail even if there is a nuclear attack by the Russians.
Another fallout of the arms race was the CIA. This was an agency that was supposed to make sense of all the information that was gathered by the various American intelligence gathering agencies. That's why it was called the Central Intelligence Agency. The mandate for the agency was to create, out of all the information it gathered, a comprehensive picture of how far ahead the USSR was in the arms race.
However, the CIA was not very successful with this. The information was typically encrypted and scanty sometime, irrelevant at other times and there was just so much information that it couldnt really make much of a picture out of it. At the same time, the USSR was consolidating the "sphere of communist influence" through political ties with the iron curtain countries. The USA had to do the same. And the CIA had a big part in this.
Although the supporters of USA and the USSR were largely defined, there was always the attractiveness of increasing the sphere of influence for both the countries. With the USSR leadership having enormous unquestioned decision making power, there was no call for justifying its actions in world affairs. But the leadership in the USA was answerable to the press, the public, the judiciary. It would have been a losing battle to engage in these unequal terms. The CIA leveled the playing field. The CIA was not answerable to any body; they had a budget that they managed themselves.
Both countries increased their sphere of influence in the world by manipulating the governments in different countries. The USA was instrumental in manipulating the governments in Latin America while the USSR did the same in Asia. Both countries meddled in the affairs of the middle east.
Drugs
The modus operandi for manipulating the government in any country was to find a political group that was agreeable to be included in the sphere of influence and then fund them and train them to overthrow the established government. Now you had a government that supported you.
However, there was a side effect of this strategy. The ousted government was a strong force that had gone underground. This established one or more militant outfits in a large number of countries that wanted to get into power. This led to civil war.
But war is an expensive business. How do militant groups get money to fund their operations? There are many ways, but the largest source of money is drugs. This led to the establishment of the drug trade. The growing of poppy, the processing of opium, the supply and distribution of the end product, heroin all came together. In fact, this became so lucrative, that it gave rise to private interests to incite civil wars.
Find a country that is susceptible to internal conflict, fund a militant group initially and then when they wanted money, they would participate in the drug trade. Thus increasing the supply chain.
Going Global
So, now you had militant groups funded by the USA and USSR as well as drug lords all over the world. Money laundering became commonplace to get drug money into the normal economy so that erstwhile drug lords would be able to retire as honourable citizen in some developed country.
Also, most of the militant groups were trained by the likes of the CIA and KGB in the latest technologies and latest techniques. The stage was set for globalization.
The militant groups now had a viable economic model based on drugs. They could now turn their attention from their local conflicts to larger, global goals. One form of the global goal we have seen is that of al queda - to drive American influence from all Muslim nations. This is a trans-national initiative. And the members are completely international: there isnt any major country that can claim to not have Al Queda establishments in it.
Thursday, September 23, 2010
Wednesday, June 16, 2010
The Most Important World Issue - Oil
The Importance of Oil
If we look at identifying the single most important thing that impacts the world today - we will find that the thing is OIL.
Oil is what makes the whole world run today. It is used for producing electricity which is used for producing everything else and it is used for transportation to get the things produced from one place to another. If there is a shortage of oil, world economies will go into a recession because the supply of things that people and companies want would decrease and things would cost more.
So, there is no doubt about the importance of oil in the world. Global oil reserves are around 1 million MB (million barrels) and annual global consumption is around 28000 MB (or 28 billion barrels). USA consumes a good quarter of this amount. So, quite naturally, it has serious interest in the resource.
Geo-Politics
The second thing to observe about oil is that oil reserves are localized to certain areas in the world - primarily in the middle east and in the caspian region.
To have stability in the world economy, every country wants a steady supply of oil at a reasonable price. But this is not assured. If certain of these countries decide to lower oil production, oil prices will rise and threaten the world economy.
US has taken this whole oil thing seriously and tried to assure itself of a steady supply of oil at a reasonable price. It has done this by cultivating a pliable government in the countries that produce oil.
Now, Iraq has the second largest reserves of oil and it did not have a pliable government. So, it was in USA's interest to get a new (pliable) government in place.
Afghanistan is another important geopolitical target. It is in a controlling position for pipelines that go from the Caspian oil reserves to China and Pakistan.
Global Oil Trade
The third interesting thing about oil is that all international oil trade is done in US dollars. This creates a huge reserve of dollars in the oil producing countries who use the dollars for all subsequent exchanges. But finally, what can one really do with dollars? The answer is - buy American goods.
When Iraq tried to change oil trade by using Euros instead of dollars, the threat to the US was very serious. In fact, trading oil in Euros has been proposed by North Korea, Iran and Iraq and very coincidentally, these three countries have been labeled as the Axis of Evil by the USA.
And just to put the money involved in perspective, the global annual oil consumption at $10 a barrel works out to $280 billion. And at $100 a barrel, it works out to $2.8 trillion. For the USA alone, the bill works out to 70 - 700 billion at the two different values.
Moral Justification
Although policy makers in the USA are aware of the problems related to oil prices, the same is not true for the average American. So, the problem of getting a pliable government inducted or a non-pliable government evicted is not an easy task.
Originally, US had a pliable government in Iran, but this wasnt what the Soviets wanted (they also play the game). They engineered a coup in Iran via Ahyatollah Khomeni and the US was out in the streets.
To counter this move, the USA supported Saddam Husein in his war against Iran. But how to justify this to the American public? Ahyatollah Khomeni was projected as the face of evil with terrorism as the issue. Now, there was moral justification for the US to be involved.
Around the same time, the Soviets invaded Afghanistan - again to secure control in the gulf area - with a friendly Iran under Ahyatollah Khomeni.
And again the US needed to counter this move. They supported the militant (and out of power) afghans called mujahideens. Of course, these things often come home to roost. The mujahideens became the Taliban and Bin Laden was one of them.
Later, after 9/11, the moral justification for war on terror was easy to obtain. Terrorism, weapons of mass destruction etc. were easy fodder to feed to the American public to justify any action.
Side-effects -
Once a militant uprising is initiated in a country, several bands of militants come up, hoping to break into the big league. Each band needs money to buy guns and ammunition to feed its growth.
There is only one business that can get that kind of money on a routine basis - drugs. Once the mujahideen were born, opium and heroin soon followed. The is a huge world-wide market for drugs, but mainly in the US. There are established supply chains and a worldwide distribution network for drugs.
The poppies are produced in Afghanistan, opium and heroin production are worldwide. There are any number of latin american countries that have innumerable drug cartels that process, store and distribute drugs.
The sale of drugs supplies money that is used to purchase guns that are required to fight the war. Today, the "war" has changed to terrorism. But the principles remain the same.
The estimated market for drugs is anywhere between $100 to $500 billion worldwide. In comparison Microsoft's annual revenue is in the region of $50 billion.
If we look at identifying the single most important thing that impacts the world today - we will find that the thing is OIL.
Oil is what makes the whole world run today. It is used for producing electricity which is used for producing everything else and it is used for transportation to get the things produced from one place to another. If there is a shortage of oil, world economies will go into a recession because the supply of things that people and companies want would decrease and things would cost more.
So, there is no doubt about the importance of oil in the world. Global oil reserves are around 1 million MB (million barrels) and annual global consumption is around 28000 MB (or 28 billion barrels). USA consumes a good quarter of this amount. So, quite naturally, it has serious interest in the resource.
Geo-Politics
The second thing to observe about oil is that oil reserves are localized to certain areas in the world - primarily in the middle east and in the caspian region.
To have stability in the world economy, every country wants a steady supply of oil at a reasonable price. But this is not assured. If certain of these countries decide to lower oil production, oil prices will rise and threaten the world economy.
US has taken this whole oil thing seriously and tried to assure itself of a steady supply of oil at a reasonable price. It has done this by cultivating a pliable government in the countries that produce oil.
Now, Iraq has the second largest reserves of oil and it did not have a pliable government. So, it was in USA's interest to get a new (pliable) government in place.
Afghanistan is another important geopolitical target. It is in a controlling position for pipelines that go from the Caspian oil reserves to China and Pakistan.
Global Oil Trade
The third interesting thing about oil is that all international oil trade is done in US dollars. This creates a huge reserve of dollars in the oil producing countries who use the dollars for all subsequent exchanges. But finally, what can one really do with dollars? The answer is - buy American goods.
When Iraq tried to change oil trade by using Euros instead of dollars, the threat to the US was very serious. In fact, trading oil in Euros has been proposed by North Korea, Iran and Iraq and very coincidentally, these three countries have been labeled as the Axis of Evil by the USA.
And just to put the money involved in perspective, the global annual oil consumption at $10 a barrel works out to $280 billion. And at $100 a barrel, it works out to $2.8 trillion. For the USA alone, the bill works out to 70 - 700 billion at the two different values.
Moral Justification
Although policy makers in the USA are aware of the problems related to oil prices, the same is not true for the average American. So, the problem of getting a pliable government inducted or a non-pliable government evicted is not an easy task.
Originally, US had a pliable government in Iran, but this wasnt what the Soviets wanted (they also play the game). They engineered a coup in Iran via Ahyatollah Khomeni and the US was out in the streets.
To counter this move, the USA supported Saddam Husein in his war against Iran. But how to justify this to the American public? Ahyatollah Khomeni was projected as the face of evil with terrorism as the issue. Now, there was moral justification for the US to be involved.
Around the same time, the Soviets invaded Afghanistan - again to secure control in the gulf area - with a friendly Iran under Ahyatollah Khomeni.
And again the US needed to counter this move. They supported the militant (and out of power) afghans called mujahideens. Of course, these things often come home to roost. The mujahideens became the Taliban and Bin Laden was one of them.
Later, after 9/11, the moral justification for war on terror was easy to obtain. Terrorism, weapons of mass destruction etc. were easy fodder to feed to the American public to justify any action.
Side-effects -
Once a militant uprising is initiated in a country, several bands of militants come up, hoping to break into the big league. Each band needs money to buy guns and ammunition to feed its growth.
There is only one business that can get that kind of money on a routine basis - drugs. Once the mujahideen were born, opium and heroin soon followed. The is a huge world-wide market for drugs, but mainly in the US. There are established supply chains and a worldwide distribution network for drugs.
The poppies are produced in Afghanistan, opium and heroin production are worldwide. There are any number of latin american countries that have innumerable drug cartels that process, store and distribute drugs.
The sale of drugs supplies money that is used to purchase guns that are required to fight the war. Today, the "war" has changed to terrorism. But the principles remain the same.
The estimated market for drugs is anywhere between $100 to $500 billion worldwide. In comparison Microsoft's annual revenue is in the region of $50 billion.
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