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yes, American foreign policy is about oil

I realized that I had never taken the trouble to read through Walt-Mearsheimer. So I wandered through their LRB essay. Their evidence is inter­est­ing, and proves beyond a doubt that there is an Israel Lobby in the United States. But their con­cep­tual framework is ridicu­lous, and their notion of how American foreign policy operates dead wrong. Take the con­cep­tual framework, which stip­u­lates a “national interest,” from which the Israel Lobby causes American foreign policy to deviate. Is there a national interest (no quotation marks)? Undoubtedly—Americans have a national interest in avoiding global warming, and in a national health­care system. Pales­tini­ans have a national interest in national lib­er­a­tion. There is a common-sense national interest, the shared interests an impartial observer would impute to all Americans or all Pales­tini­ans or all human beings. But is there a “national interest,” as realist IR theory claims? Of course there isn’t. Cap­i­tal­ism creates vested interests in rampant carbon-producing con­sump­tion, with a total “cost” of the anni­hi­la­tion of civ­i­liza­tion, and perforce the eventual anni­hi­la­tion of cap­i­tal­ism. The health care system is the least efficient in the developed world, with trillions in costs for the American economy. Pales­tini­ans produce a col­lab­o­ra­tor class, entrenched in the highest levels of the PA and living glitzy make-believe lives in Ramallah. The “national interest” is not a serious concept. American politics, as Thomas Ferguson has estab­lished, is better explained by the “invest­ment theory”: con­tend­ing groups of investors strug­gling for gov­ern­men­tal power. The evidence Mearsheimer and Walt adduce is still relevant, and it still estab­lishes that there is an Israel Lobby. But it turns out that the Lobby doesn’t do what M-W think it does. Take one claim, the one I am inter­ested in, because it gets to the issue of causal motors:

Probably the most popular argument made about a coun­ter­vail­ing force is Herf and Markovits’s claim that the cen­tre­piece of US Middle East policy is oil, not Israel. There is no question that access to that region’s oil is a vital US strategic interest. Wash­ing­ton is also deeply committed to sup­port­ing Israel. Thus, the relevant question is, how does each of those interests affect US policy? We maintain that US policy in the Middle East is driven primarily by the com­mit­ment to Israel, not oil interest. If the oil companies or the oil-producing countries were driving policy, Wash­ing­ton would be tempted to favour the Pales­tini­ans instead of Israel. Moreover, the United States would almost certainly not have gone to war against Iraq in March 2003, and the Bush admin­is­tra­tion would not be threat­en­ing to use military force against Iran. Oil is clearly an important concern for US pol­i­cy­mak­ers, but with the exception of episodes like the 1973 Opec oil embargo, the US com­mit­ment to Israel has yet to threaten access to oil. It does, however, con­tribute to America’s terrorism problem, com­pli­cates its efforts to halt nuclear pro­lif­er­a­tion, and helped get the United States involved in wars like Iraq.

This is the trouble when realist scholars of inter­na­tional relations start analyzing political economy. Place to the side that the only two inde­pen­dent variables are the Lobby and oil prices—or access, or the “oil interest,” or “oil companies,” or “oil-producing countries,” (what fun is this con­cep­tual slippage, as we move here-and-there, not bothering to be con­sis­tent or to many any sense, the pre­rog­a­tive of scholars working in the interests of domestic power). To be fair, M-W are only echoing con­cep­tual dis­agree­ment amongst Marxian scholars unable to agree on how and why oil affects American policy in the Middle East, but that’s no excuse for not sifting through all the theories to see if any of them are accurate. In any case, there are at least two other influ­ences on American foreign policy: the military-industrial complex, and the interests of capital enter­prises not affil­i­ated with petroleum or petroleum-related interests, the broader armament indus­tries, or the Israel Lobby.

Nitzan and Bichler clarify:

The realist failure to square the circle around oil prices is only under­stand­able. The basic reason is that, by the 1970s, while the world was already well into the ‘limited flow’ era, realist theories were still stuck in the ‘free flow’ logic. Stephen Krasner, for example, claimed that there was a negative trade-off between the level and vari­abil­ity of petroleum prices (1978b: 39–40). The con­se­quence, he concluded, was that policy makers had to choose between low but variable prices, or stable but high ones. Yet, when those lines were written, this menu had already become irrel­e­vant, and in fact mis­lead­ing. From the late 1960s onward, with oil shifting to a ‘limited flow’ footing, the rela­tion­ship between the level and vari­abil­ity of prices became positive. The choice now was not between low and variable oil prices as opposed to high and stable ones, but rather between low and stable prices against high and volatile ones.

Obviously, this tran­si­tion fun­da­men­tally altered the rela­tion­ship between the oil companies and the so-called ‘national interest’. During the early period, when the companies were concerned mainly with con­ces­sions, the Administration’s will­ing­ness to have higher prices in order to secure stability and access seemed sensible. It helped the companies, as well as the broader U.S. ‘national interest’. Since the late 1960s, however, harmony gave way to discord. The United States could no longer pay higher prices in order to achieve access and price stability; it couldn’t, simply because access was no longer nego­tiable, whereas higher prices were clearly causing greater insta­bil­ity. The oil companies, on the other hand, were now inter­ested not in access but in higher prices. Contrary to the earlier situation, therefore, there was now clear conflict between the companies and the ‘national interest’, and the Administration’s pursuit of both insta­bil­ity and higher prices only indicates where its alle­giances lay.

Support for Israel, or Israeli bel­liger­ence, usually means constant conflict, or the constant potential for conflict, in the Middle East, and constant conflict in the Middle East usually leads to higher oil prices (during the Iran-Iraq War, both sides over­pro­duced, busting OPEC quotas, in order to pay for their arms purchases). This system continued in one or another form through the early 1990s, when every time the average return for major petroleum companies dipped below the Fortune 500’s average return, there was an “energy conflict,” jolting up oil prices and arms sales. The Gulf War was the temporary break in this pattern: “During the 1990s, dominant capital as a whole was increas­ingly seeking cross-border expansion, a process which required tran­quil­lity, not turmoil. Given that military conflict endan­gered such expansion, and that high energy prices threat­ened to choke the green-field potential of ‘emerging markets’, the Weapondollar-Petrodollar Coalition found itself increas­ingly isolated.” What happened, as petroleum prices again plummeted in the late 1990s and early 2000? We went to war again, first in Afghanistan, and then in Iraq, whereupon profits for the petroleum companies, the weapons indus­tries, and the Tel-Aviv stock market shot through the roof—just look at the figures—representing a con­flu­ence of interests between arms man­u­fac­tur­ers, the oil industry, and the Israel Lobby. Is this a func­tion­al­ist expla­na­tion? Yes, it is. Does it explain the political economy of the Middle East? Fairly com­pellingly. Does this mean there’s no Lobby, or that it has no power? Not at all: it has plenty of power, just not deter­mi­na­tive influence vis-à-vis American foreign policy in the Middle East. Has Nitzan and Bichler’s book been stu­diously ignored by those writing on the Israel/Zionist/Jewish Lobby? Yes, it has. In the case of M-W, this ignorance makes a great deal of sense. In the case of leftist analysts, this ignorance is more confusing. It’s not our problem to explain that ignorance, but the reper­cus­sions of writing the petrodollar-weapondollar core out of our analyses is all of our problem, espe­cially when those trying to root the Lobby in mate­ri­al­ist analyses are dismissed as crypto-Zionists, Jewish apol­o­gists for Israel, or whatever term of abuse is hauled in to avoid real discussion.

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16 comments to yes, American foreign policy is about oil

  • Rob

    Excellent. Will look at the Nitzan and Bicherl book.
    I think one of the reasons that this debate is so ongoing is that the main terms are not clearly defined, or people are not inter­pret­ing them in the same way — “national interests”, as you say, and even the Lobby itself. If the terms are not clearly defined, it is really impos­si­ble to even have the dis­cus­sion at all.
    “espe­cially when those trying to root the Lobby in mate­ri­al­ist analyses are dismissed as crypto-Zionists” — yes, this is quite funny sometimes. Another good one is “gate­keeper”. Some fail to see that the two views are not at all mutually exclusive.

    In a sense, the W&M idea of the Lobby goes too far (too nebulous), and in another sense it doesn’t go far enough into rec­og­niz­ing it as a symptom of the deeper systemic cor­rup­tion of politics in the US, and how it fits quite nicely into place there — and if it were gone, it would leave the US imperial hands somehow less bloody, and white as snow.

    Tony Judt did, however, bring up an important point, in that it has had a very destruc­tive effect on free speech, and it is the only lobby which tries to deny its very existence. But, are we to believe that every person who puts pressure on or harasses jour­nal­ists or academics voicing critical views on Israel’s behavior is also part of the lobby? There are stupid, bigoted people out there who have no need of a lobby to tell them what to do. I see it as more like the Bernays/Herman/Chomsky model of “man­u­fac­tur­ing consent”, or a very effective PR machine, in which people basically become self-censuring.

    • I think this is the right way to look at it and I think it’s unfor­tu­nate that the debates are so vitriolic and sterile due to the accu­sa­tions that get slung around when an analysis deviates from some stip­u­lated orthodoxy.

  • Andy Pollack

    Brilliant, Max. Thanks for alerting us to the com­plex­i­ties of oil pricing as one more factor required for a truly mate­ri­al­ist analysis. This overlaps to some extent with the debate on the left during the first Gulf War about whether the US was more inter­ested in profits from oil, or control over access to it by other impe­ri­al­ist powers. And with regard to the former, how did the interests of domestic versus foreign oil pro­duc­tion and/or refine­ment affect ruling class policy makers dif­fer­en­tially?
    Of course on top of all these questions is the role of pro-US Arab regimes in helping maintain prof­itabil­ity and/or control.
    Andy Pollack

    • Thanks Andy. N+B go on to argue that OPEC and the petro-core essen­tially arrived, at least during the golden years, the 70s, at an under­stand­ing between oil companies and national gov­ern­ments allowing for the max­i­miza­tion of profits on all sides, so pro-US Arab regimes always play a strong role, creating a built-in excuse for sup­port­ing Israel that becomes cyclical: Israel needs dic­ta­tor­ships working against the interests of their pop­u­la­tions to maintain its predatory expansionism/occupation, that very col­o­niza­tion and occu­pa­tion further rad­i­cal­izes the populace of the Arab/Muslim countries; in turn you need dic­ta­tor­ship to keep the policies of the states roughly pro-Israel, and via dic­ta­tor­ship you can prevent oil wealth from seeping down to the pop­u­la­tions, keeping them poor and atomized and desperate. Works until it blows up of course.

  • Tadhg

    Another term of abuse might be “supporter of Israel,” except Chomsky has already used that one to char­ac­ter­ize himself. I mention this only in order to point out that he seems to evince little more enthu­si­asm for a Weapondollar-Petrodollar-Lobby Coalition analysis than the so-called realists, largely dis­miss­ing the Lobby and somewhat vulgarly reducing Israel to a US regional catspaw — surely not a serious mate­ri­al­ist analysis.

    • Well, two things. One, Chomsky’s approach is a fairly vulgar Marxism, and that approach does explain fairly decently most of what he writes about. with holes.
      Two, writing on the left about I-P seems to have scarcely discussed this book. It came out in 2002; I don’t under­stand why. To me it seems like it should be framing the conversation.

  • the Nitzan and Bichler book is truly extra­or­di­nary, as it excavates a sub­ter­ranean economic world that provides insight into actions and behav­iours that would otherwise be inexplicable

    but the manip­u­la­tion of conflict in the region was about more than just increas­ing the return on invest­ment, rather it was about a priv­i­leged group of cap­i­tal­ists reg­u­lat­ing the return up and down so as to increase con­cen­tra­tion of wealth and power within themselves

    hence, they could accept lower returns, and even losses, if, on a pro­por­tional basis, they suffered less and con­trolled a greater con­cen­tra­tion of capital as a result

    they exhaus­tively document the con­cen­tra­tion of capital within Israel that occurred as a result

    starting with a critique of classical economics that shows that cap­i­tal­ists do not always profit maximize, they then proceed to under­stand why they don’t

    this is an essential book for the left, a marvel, and their most recent book may be as well, the one they published a year or so ago

    • yes, for sure. I think everyone writing/involved with I-P or on the left should read this book; there’s plenty to get out of it whether or not you’re much for Marxist political economy. and plain everyone should read their more recent one.

  • DavidGreen

    Max, where do you think the idea of “grand area strategy” fits into all of this? That refers, I presume, to interests beyond the price of oil and corporate profits, to control of oil vis a vis Europe and Asia. Do you think there are “wise men” operating at an even more abstract level of interests–“wise men,” so to speak?

    • I’m not sure. Kolko generally and Gowan in the Global Gamble are pretty good on this; during the Bush years if we accept the dis­tinc­tion between breadth and depth regimes, a fragment of dominant capital asso­ci­ated with oil, high tech­nol­ogy, and weapons man­u­fac­tur­ing (and Israel) took control of the pres­i­dency, and just went on a binge of energy conflicts and looting. They had their “plan” for grand strategy, the Project for a New American Century but that stuff is not at the level of post-WWII strategic planning vis-a-vis Europe and Japan, it’s kind of absurd stuff. And even then, post-WWII Grand Strategy did not work as intended, they never intended so much devel­op­ment in Japan for example. But the “wise men” may have just gotten dumber in the Bush years.

      I am not sure how much of an issue direct access to M-E oil for Europe/Japan is anymore; more important I’d think is the flow of petro-dollars.

  • Thanks for this insight­ful analysis! I will have to look into Nitzan and Bichler’s work. I also con­sid­ered Mearsheimer and Walt’s reasons for dis­miss­ing the role of oil in the occu­pa­tion of Afghanistan and Iraq one of the weakest parts of their analysis, although I’ve relied primarily on Chomsky’s expla­na­tion of the issue of oil as primarily one of control of Europe’s supply. I’ve also con­sid­ered the larger geopo­lit­i­cal objective of keeping China isolated to be a possible factor, although I’m not sure if anyone has verified that one.

    I don’t think that oppo­si­tion to a mate­ri­al­ist analysis of Israel’s rela­tion­ship to the US is so much based on fear that it’s somehow “crypto-Zionist” as much as it is oppo­si­tion to mate­ri­al­ism or anything that smacks of Marxist analysis in general. Clearly, we all know better than to expect main­stream academics to embrace mate­ri­al­ism, as the primary function of an academic is to act as an apologist for the status quo. While the grass­roots and civil movements that are slowly coming together to form a genuine resis­tance movement tend to be a little bit more open to mate­ri­al­ism, anything asso­ci­ated with Marx still scares off a large number of liberals, and networks of committed social­ists and Marxist intel­lec­tu­als still seem to be divided into different factions. The fact that mate­ri­al­ism has repeat­edly proven itself effective at explain­ing the really existing con­di­tions in many cases, on the other hand, as well as the growth of coop­er­a­tion between social­ists and anar­chists and different Marxist factions, seems to be slowly winning such analysis a larger audience than it has received in a long time.

    • Brian,
      I wrote the thing about crypto-Zionist because many try to disparage the sort of analyses I syn­the­sized above as “Chom­skyite” or “crypto-Zionist” because it “exon­er­ates” the Lobby from its “correct” portion of blame. I don’t like getting into that kind of name-calling in lieu of of dealing with the arguments. what surprises me is oppo­si­tion to mate­ri­al­ist analysis even from leftists; I com­pletely agree that the wide-spread recep­tive­ness to anti-materialist analyses is a result of people being drawn into resis­tance to Israeli policies from all sorts of ide­o­log­i­cal ori­en­ta­tions, including squishy liberal pro­gres­sivism. I am thinking espe­cially of James Petras, for example. Only solution is to keep pam­phle­teer­ing from this side.

      • one of the problems in address­ing a subject like this is the tendency to create what the philoso­phers call “binary oppositions”

        here, that means the US on one side and Israel on the other, so the oppres­sion of the Pales­tini­ans must be either pre­dom­i­nately the fault of a cap­i­tal­ist elite centered in the US (Chomsky) or Israel, along with its instru­men­tal­ity in the US, the Lobby (Blankfort)

        in fact, as even the most cursory exam­i­na­tion will show, there is a sub­stan­tial political, gov­ern­men­tal and economic crossover between the two countries, acting in concert in pursuit of interests beyond super­fi­cial nation­al­ist ones asso­ci­ated with either the US or Israel, and Nitzan and Bichler provide a framework for engaging it and under­stand­ing it (if only they had the resources to research and publish a book about the global political economy of the US!)

        (con’t)

      • (con’t)

        for example, Nitzan and Bichler document the economic inter­re­la­tion­ship between US and Israeli cap­i­tal­ists, espe­cially in telecom­mu­ni­ca­tions, along with Russian oligarchs, rela­tion­ships that have effec­tively neolib­er­al­ized Israeli society (this is one of the essential themes of the book, how domestic and foreign capital collude to dismantle existing social welfare systems within devel­op­ing countries), such that the ability to situate the source of the power that oppresses the Pales­tini­ans in one place becomes difficult

        perhaps, this puts them closer to the Chomsky per­spec­tive, although I have dif­fi­cul­ties with how Chomsky for­mu­lates it, because he seems to have increas­ingly become an apologist for the per­pet­u­a­tion of Israel as a Zionist state, something that is not a necessary outcome as a con­se­quence of his analysis or Nitzan and Bichler’s, if anything, Chomsky’s view (a 2-state solution), per­pet­u­ates the frag­men­ta­tion of peoples, bound­aries and gov­ern­men­tal authority so as to per­pet­u­ate such neolib­eral processes

        • Rob

          “because he seems to have increas­ingly become an apologist for the per­pet­u­a­tion of Israel as a Zionist state, something that is not a necessary outcome as a con­se­quence of his analysis or Nitzan and Bichler’s, if anything, Chomsky’s view (a 2-state solution)“
          – meh.
          You’d have to define Zionist here, I think. Also, Chomsky’s “view” is not a 2-state solution, it’s mis­lead­ing to say that. What one desires and what one thinks is the best way to move forward (whether right or wrong) are two different things alto­gether.
          Anyway, it’s clear that :
          1 : The Walt/Mearsheimer essay is not really con­tro­ver­sial at all (in my view)
          2 : It is not at all opposed to analyses put forth by people like Max and Gabriel Ash, they are just operating at different levels of analyses, and finally are not really talking about the same thing. If anything, they are complementary.

  • Arraya

    Excellent analysis,

    I would agree oil companies like high prices, but I think at this point in history, everybody is concerned more about unin­ter­rupted access and pro­duc­tion, than elevated prices. Though for explo­ration to be prof­itable today oil prices need to remain about $70 or it’s just not worth it for the majors to look for oil.

    I’ve been following the oil market for about five years now. It was pretty well known that we would be hitting “peak oil”, the point where we the flow rate tops out and then goes in to terminal decline, sometime in the first few decades of 21st century since at least the late 50s. It was narrowed down to around now in 00–02(see cheney’s secretive energy task force meetings in 2000 and speech from 1998 when CEO of hal­libur­ton in which he states that the ME was “where the ultimate prize lies”). Coin­ci­den­tally, Iraq is the only region in the world that can sig­nif­i­cantly increase oil pro­duc­tion, which could actually delay peak possibly a decade and may become the new global swing producer if all goes as planned(doubtful IMO). It seems Saddam was not very good at drilling for oil. Regard­less, Iraq is the most unex­plored major producing region for sweet crude as opposed to the low-quality, hard-to-get, slow-to-extract and expensive, shales and tar sands that can be found in large quantities.

    As you point out, Iraq was in all the “power lobbies” interests and Iran is were they diverge, for now, IMO. Though, it seems Israel has been trying to sell it for some time now. If the Israel lobby was so all powerful GW would have bombed Iran. The “war on terror” is a multi-faceted “win”

    Anyway, studying the oil market leads to mid-east policy which leads to Israel and the Israeli lobby and Pales­tin­ian conflict…which brought me here;)

    Cheers

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