Sunday, February 19, 2006

Gulf War I Conspiracy Theory Revisited.

NO WAR FOR OIL!!! Ahhhhh, a new catchphrase for a generation protest and conspiracy-minded people. I was a junior in high school when Saddam Hussein invaded Kuwait in 1990 and the first Gulf War started in 1991. I remember hearing the conspiracy mongers delve into “all the angles” on the issue. One thing was for certain, this was not a just war like WWII when we ended the Holocaust. The only reason we were involved was one thing, oil. We had no business inserting ourselves into the squabbles of other nations. We stood no chance, Hussein had one of the five largest armies in the world and said this would be the mother of all wars. No American's life was worth saving 10¢ per gallon at the pump. And above all else George H. W. Bush was an “OilMan” who gave Hussein permission to invade Kuwait assuring him that is he did invade the US would not interfere (thus making Hussein a hapless patsy).; once the war was over he was going to pillage the Middle East and “steal all the oil.” It seemed plausible enough, to a sixteen-year-old boy that is.

The war started. I remember being at the mall with by friend Christian when word that US and her allies began bombing. I called home to find out what exactly was going on. My mother had been a small child through WWII, had nearly seen my father shipped off to Korea as a Marine, Vietnam and still harbored a ton of Cold War paranoia. Her suggestion, come home now, they may try to strike back. No way was I going home. I tried to explain to my mother that there was no way the Iraqis were going to counter-attack in the US let alone Indiana.

As the war carried on first came air superiority, then came Iraqi retreat from Kuwait, then came the total defeat of Iraqi forces in the land war. Saddam Hussein and his forces were defeated; and not with the “Mother of all Wars” that was promised by Hussein. Relatively low casualties on our side.

Then something strange happened, or didn't happen. George H. W. Bush the “OilMan” did not install the puppet regime in Kuwait, did not march on Baghdad, did not make any aggressive action toward the Middle East at all. In short, the looting of oil as predicted by the conspiracy hounds never happened. Life went on, the US and her allies put out the oil fires and went on. The US base remained in Saudi Arabia, and that is about it.

The conspiracy theory that Bush and the US were going Kuwait and Iraq solely to increase the profits of the evil “BigOil” was dead and buried, right? Wrong.

Just as conspiracy kooks have no trouble re-writing history to fit their theories, they also have no trouble re-writing their own theories to fit history if they cannot effectively re-write it

I recently read an article on the popular conspiracy website, In an article entitled, “Fake Terror: The Road to Dictatorship” the website contends that nearly every war fought in the last century was done so under false pretenses and always seems to place the US in the role of the aggressor. This where I found the re-write of the Gulf War I conspiracy theory “Gulf War I was so BigOil could profit.”

The purpose of the theory is to convey and “prove” the following: Gulf War I + GHW Bush + X = Profit for BigOil. Previously X = “stealing the oil.” The problem is that the oil was never stolen. So how do you keep your theory intact? Change X to something that did happen. In this case X ends up as the following. We wanted Iraq to burn the oil wells and we wanted to destroy Iraq and further sanction Iraq for one purpose... to take the oil off the market. You see? If there is a shortage of oil then the price will go up and BigOil gets its profits!

It seems plausible... except for one tiny thing. It makes absolutely no economic sense. History will debunk this theory as it did its predecessor, but I don't feel like waiting around.

The premise of this theory is that BigOil makes more money by, pay attention here, not selling oil. With the Kuwaiti and Iraqi oil off the market and not being sold, BigOil makes more money. One could be fooled into believing this if they were not familiar with the way that the market works. Basic economics dictates that a company maximizes its profits by selling the most amount of goods and services possible while keeping expenses down. In other words: Profit = Sales – Expenses.

In this scenario, there are fewer production facilities online, thus less oil is sold overall. There are massive expenses in repairing the damaged facilities. In other words, expenses are up, gross sales are down. Look at any business that has failed miserably and you will find the same thing. From AMC (the automobile manufacturer) to, low sales and high expenses killed them all.

Let's look at some real world businesses that are profitable as examples. Walmart, few companies are as profitable as Walmart. How does Walmart operate? Simple, sell as much stuff as you can, sell it fast, keep your expenses down. Walmart would never dream of allowing only 200 32 inch TV's to be sold and charging $5,000 in the name of “profit” simply because it would not be profitable. Daimler-Chrysler, a very profitable automobile manufacturer that sells a variety of automobiles.

So tell me, which serves the bottomline better, selling a couple hundred Lamborghini Diablos at over $250,000 a pop or selling hundreds of thousands of PT Cruisers at $17,000 a pop? If you can't figure it out it is telling the Daimler-Chrysler dropped Lamborghini.

Everyone knows that BigOil wants to maximize profits, that is a business's sole purpose of existing is to make money for the person and/or people that own it. So how are they going to do it? Easy, sell the most oil (which means that it will abide by the law of “supply and demand”) and incur the least amount of expenses possible (including avoiding having drilling and refining facilities destroyed).