The Iraq war a great success?
Source Ken Hanly
Date 06/07/30/19:49

The Iraq War is a Huge Success
The Economics of Creative Destruction

By Aseem Shrivastava

“IF HE THAT SHARED the danger enjoyed the profit, and,
after bleeding in the battle, grew rich by the
victory, he might show his gains without envy. But, at
the conclusion of a ten years' war, how are we
recompensed for the death of multitudes, and the
expense of millions, but by contemplating the sudden
glories of paymasters and agents, contractors and
commissaries, whose equipages shine like meteors, and
whose palaces rise like exhalations!

“These are the men who, without virtue, labour, or
hazard, are growing rich, as their country is
impoverished; they rejoice, when obstinacy or ambition
adds another year to slaughter and devastation; and
laugh, from their desks, at bravery and science, while
they are adding figure to figure, and cipher to
cipher, hoping for a new contract from a new armament,
and computing the profits of a siege or tempest.”
Samuel Johnson

07/29/06 "Information Clearing House" -- - The secret
of capitalist success, the great economist Joseph
Schumpeter famously argued, is “creative destruction”.
The dynamics of capitalist competition generate
technological innovations at a rapid clip, each
superior method causing the obsolescence of prevailing
techniques, old machines giving way to new in a
ceaseless cycle of growth and prosperity.

Imperialistic wars, Schumpeter believed, were signs of
atavism, harking back to humanity’s more
anachronistic, primitive impulses. However, he failed
to see that such wars brought forth another form of
creative destruction which capitalism finds most handy
in its onward march.

The reigning view among most critics of the war on
Iraq is that it has been a fiasco. No weapons of mass
destruction were found, nor any link with the
terrorists who plotted 9 -- 11. Most importantly, more
than 3 years after Bush declared the end of the war,
the insurgency in Iraq is stronger than ever.
Undeclared civil war is threatening to break up the
country. Hundreds of thousands of innocents may have
been murdered by the American invasion, in addition to
the deaths of over 2500 US soldiers, and the end is
not in sight. So, it has become a commonplace to
suggest that the whole enterprise has been a disaster
from all possible points of view.

This is a fundamentally mistaken view, a victim of the
red herrings thrown at the public by Washington
warlords and their ideologues.

Is there reason to believe that the war, far from
being a disaster, has actually proceeded quite well
from Washington’s point of view? That the view that
the war has been a fiasco is merely a convenient
smokescreen of innocence helpful to keep in check
public perceptions of the monstrous crimes of leaders
in Washington and London?

First, and easily forgotten, the obvious success of
the Iraq adventure has been to get rid of that rotten
dictator Saddam Hussein. Democracy has dawned on an
Islamic land. Thanks to American blessings, people can
now elect their own representatives to govern them,
even if they get their heads blown off every now and
then when they step on to the streets.

Looking beyond that, however, there are some sobering
facts. Let’s begin with the lessons history teaches.
The dominant view is that the Vietnam War was lost by
the US. It was driven out of Vietnam. 58,000 Americans
died in the war, apart from the millions of Indo --
Chinese. All this may be true. However, if you look at
it from the perspective of American corporate elites,
rather than from the perspective of the majority of
Americans, Washington succeeded in its primary goal,
which was to prevent an alternative model of
independent Third World development (something like
what Cuba has tried and Venezuela is trying these
days) from taking root. Vietnam was not allowed to set
an example which might have generated a domino effect
across the developing world, much to the loss of the
United States, which would have become a less
indispensable nation. True to American plans, Vietnam
is an open -- market economy today, dependent on a
globalized economy led by the US.

Moreover, the military spending on the Vietnam War
consolidated the policy framework of Military
Keynesianism which had been learnt to be of great
economic use since the days of World War II. Key to
this approach is the enrichment of weapons
manufacturers and reconstruction industries who have
an assured market. The military purchases are deficit
-- financed by the Federal government at the cost of
the tax -- paying public. Reconstruction costs are
levied on the tax -- paying public of the destroyed
nation. Weapons dealers like Lockheed -- Martin and
United Technologies got handsome contracts from the
Pentagon. Companies like Kellogg, Brown and Root and
The Louis Berger Group (both invited to bid for
reconstruction contracts in Iraq) got plenty of
business when they were asked to build harbors, roads,
bridges, airports and military bases in the period of
post -- war reconstruction in Vietnam.

The hidden agenda of the US government in Iraq has
been three -- fold. Firstly, to take control of the
world’s second largest oil reserves, thereby seizing
one of the key oil spigots of competitors like Japan,
China and the EU. Secondly, to prevent the dollar --
based world oil market from transacting in Euros,
something Iran, Iraq and Venezuela were attempting
since 2002, when the Euro was launched. Thirdly, the
establishment of permanent US military bases in the
strategic heart of the world. (The US has built the
world’s largest embassy – employing 5000 people – in

In all three respects, the war has been a resounding
success. US oil companies have taken charge of Iraqi
oil. In the future it is through them that Japan,
China, EU and any other competitors will have to buy
oil from the region, something that gives the US
formidable leverage. The oil market continues to
transact in dollars, fragile as it is as a global
reserve currency. Iranian experiments with the Euro
Bourse have not taken off.

The war has also achieved some other remarkable,
unmentionable goals for Washington. Firstly, it has
managed to demonstrate the “credibility” of its
military intentions of gaining full -- spectrum
dominance in the post Cold War world. It has been, as
one journalist puts it, a successful “global
experiment in behaviour modification.” Secondly, the
war industry has made huge profits as military orders
have grown, Bush repeatedly asking Congress for more,
almost $ 0.3 trillion having already been spent on the
war. Nobel -- Laureate Joseph Stiglitz estimates the
war to cost (and the weapons manufacturers to get)
between $1 and 2 trillion over the next several years.
Thirdly, firms from the reconstruction industry have
been having a field day, the costs of reconstruction
(which are effectively benefits for the US
corporations, at the expense of the Iraqi public: “we
destroy, we rebuild, you pay”) are estimated at
somewhere between $10 and $60 billion over the next
several years, most of it to be levied – with
typically imperial justice – on the tax -- paying
public of Iraq, the punishment for enduring a CIA --
installed dictator for decades.

The Economist had described Iraq sometime back as “a
capitalist dream.” Senator John McCain had called it
“a huge pot of honey that’s attracting a lot of
flies.” The Halliburtons and the Bechtels, as much as
venture capitalists have been dipping greedily into
the pot for sometime already, their access cleared and
guarded by the US military. After a long period of
economic seclusion under Saddam Hussein, followed by
the decade of UN sanctions that strangled the country,
the resources, the markets and the labor of the
country have been put at the disposal of “the
international community” (that is, Americans,
occasionally including the British).

Among those who know, the accepted view is that Iraq
has suffered two assaults, the military and the
corporate , both filling the coffers of Washington’s
patron corporations at the expense of epic human
misery. Reviewing the enormous corruption and the no
-- bid contracts handed out to companies like
Halliburton and Bechtel, The Boston Globe recently
suggested that the American involvement “amounts to
two invasions. First the bombs. Then the banks. This
is robbery, not reconstruction.” To add insult to
these injuries, all US oil corporations operating in
Iraq have been granted total legal immunity from
prosecution for any crime -- involving labor, human
rights or environmental law or any other violations --
under an Executive Order issued by the President a few
years ago. For all that the “international community”
cares about human rights and the environment, Exxon --
Mobil or Chevron -- Texaco could use slave labor or
spill their oil off the coast of Basra without having
to worry about any sort of prosecution whatsoever.
Rule of law in the new, democratic Iraq.

In yet another, sinister, sense the war has been a
remarkable success from Washington’s angle. It may
succeed in dividing forever the three main communities
in Iraq, Shia, Sunni and Kurds, enough to sustain the
justification for a permanent US military presence in
the country. Keeping a devastated nation on the brink
of chaos may be part of a more or less conscious (if
obviously secret) strategy to secure the long -- term
benefits of military and economic occupation. This is
an old -- divide and rule -- tactic of colonial
powers, aimed at making the country ungovernable from
within. The Americans have learnt it from the British.
The logic was often given in the case of Hindus and
Muslims in India by the British in the early part of
the last century, Churchill always eager to point out
that Indians will not be able to govern themselves in
the absence of the British. All imperial powers are
devilishly driven to create vacuums which they alone
can occupy.

Other little successes have been notched up. Security
corporations -- with their hired mercenaries from all
over the world -- have been used on an unprecedented
scale. Poor young men from regions as far afield as
the Far East, South Asia and Central America have been
tempted with dollars and possibilities of US
citizenship to fight white men’s wars. The racism and
the cowardice are old. The corporate technique is new.
Global security is one of the fastest growing
industries today. It is already $100 billion in size
and growing at 7 -- 8% annually, expected to double in
size by 2010.

>From Washington’s point of view, perhaps the most
significant success of the Iraq venture is that the
experiment with the two-pronged --destroy and
reconstruct -- approach to enriching US corporations
has worked with even greater success than in Vietnam.
Now this cash -- generating capitalist module can be
deployed with as much profit elsewhere. Iran?
Venezuela? The more oil the country has, the better
from the US point of view.

Neither the loss of lives, American or otherwise, nor
the unprecedented fiscal crisis in Washington is going
to stop the empire from enlarging the scope and scale
of its global operations. No imperial overstretch yet,
it seems. The US Federal Reserve can be, literally,
banked on to print the necessary currency to finance
any number of wars – and get the American and world
public to pay for them. A great, but little -- known
secret about the Federal Reserve, America’s central
bank, is that it is ultimately owned and controlled by
shareholders belonging to large, private commercial
banks (several of them non -- American) like Lehmann
Brothers and Rothschilds. So while private bankers
make huge amounts of money by merely printing and
lending it to the government, the ignorant tax --
paying public must keep footing the bill of war
expenses: a long -- standing, built -- in mechanism
for organized graft.

Loss of American lives can be minimized – and the
dreaded Vietnam syndrome be avoided – by using the
hired guns of security corporations from other
countries, whose deaths do not even have to be
reported. Money for more wars can be borrowed from
East Asians and others too, who don’t look like they
are going to stop their purchase of US Treasury bonds
anytime soon.

The day is not far when, as the American historian
Theodore Roszak has recently suggested:

“The American imperium becomes a private, for profit,
off -- the -- shelf, regime -- change industry. There
will be firms standing ready to fight the wars,
organize the occupation that follows, rebuild the
ruined infrastructure that results from the wars,
recruit new governments, and manage the post -- war
economy. There may even be private educational
services hired to train the conquered population in
the rudiments of high -- consumption democracy, and
hoards the evangelical true believers eager to save
heathen souls from damnation.”

Aseem Shrivastava can be reached at

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