gold,oil and war.....from long waves

A great summation of the recent history of these three subjects.

Gold Oil and War
by B. Parady
25 January 2003 07:04 UTC



The obvious drive of oil and gold to higher prices under
the flowering drum song of war, suggests some fundamental
economic issues that have threaded through society
for at least the last couple of centuries.

Let's start it simply with the founding of California. This
one is easy, but the annexation of California to the US was
precipitated by the gold rush and what it meant to the
US government.

Now let's switch over to the Franco-Prussian war. What
was that all about? Some credit France for initiating it to
capture the coal fields of the Saar. As it ended, the Prussians
annexed the coal rich region of Alsace Lorraine (Lothuringia
if you are German) as a key strategic spoil. Interestingly
enough, this region was one of the first major oil producing
regions, and is the home of Schlumberger, the giant oil
services firm.

OK, still no oil, but in the 19th century, the next best thing
was coal. After all it provided all that modern petroleum
drilling provides: gas, coal oil, chemical stock, and fuel.

Next shift over to the Northern hemisphere. Here we start out
with the development of the Panama canal. What is the US
looking for here? Coaling stations for the navy, and we get
Guantanamo as a tiny spoil, along with Guam and the Philippines.

Later the US goes out and plunks down cash for Samoa and
the Virgin Islands as coaling stations for our expanding navy.

Next shift over to the far east and Japan. Roll in the big boys for
the first little naval discussion in the Russo-Japanese war. Here
we have Port Arthur coaling station being taken by the Japanese
along with the coal rich Sakhalin Island.

Now we have set the table with the modern navy and the dreadnought.
Britain has developed a ship that needs oil, though they did have
coal bunkers on some. The oil was much quicker for fueling and
refueling. Britain has a problem here. No natural resources, just
like Japan. What to do?

First off, they need to get the gold, so Boers need to go. Filthy
beggars.

Germany of course wants to be modern like Britain, but this makes
Britain very nervous, and off we go. The French of course want
Saar and Alsace-Lorraine again, and now let's party. Hey after all
we have the Boer gold to pay for all the party favors.

OK, so they work this out. Some of the biggest oil strikes occur
under the dominion of the Hun's greatest ally, Turkey, then possessor
of the Arabian peninsula. Well, what has to happen is that
France needs its toys, and Britain needs to get its trinkets, so
we all need to assemble under the Christmas tree in Versailles,
while Wilson, the college president, is trying to push his 14 points
on anyone silly enough to care.

So after the War, the UK gets Iraq and Kuwait, along with
concessions in Saudi Arabia, and dominion over Aden, Qatar,
Musqat and Oman; the French get the oil fields of Alsace and
a couple fueling stations. So far fun stuff.

Now, guess who is up to bat? Japan. They like the idea
of coal, so Manchuria seems like a great idea. Though
with the modern navy, stoking coal is not a whole lot of fun.
It is awfully dirty work and it is smelly. Makes a mess out
of white naval uniforms.

What to do? Oil is the obvious answer, but gosh darn
Japan is a small set of islands. Ok, Ok, let's look around on
the map. Yes, I see it, the Dutch East Indies and the discoveries
of Royal Dutch-Shell in 1903. What are the Dutch going to do with oil
anyway. They got no navy and they are a lousy small country.
Time to push these pantywaists out of the way.

But wait, what is between the Dutch East Indies and Japan?
Small problem - the US held Philippines. Ok, negotiate with
the US to get access to the oil then everything will be fine.
The US sees this and Roosevelt hits the roof. He sees the
coming domination of the South Pacific by Japan and
puts a stop to this nonsense and issues an ultimatum which
the Japanese cannot abide.

Party time again, now in Hawaii (no disrespect to those who were
injured or fallen, please allow me to make this horrible contrast) with
lots of fireworks, along with the Philippines, Singapore, and Indonesia.

If you want to see the role of gold in W.W.II, just look at the
hideous scavenging of bodies for dental and ornamental gold
by Hitler's minions.

This brings us to the present. There is a crisis in gold or
currencies, and a crisis in oil -- the two are not necessarily
separable. With cheap supplies running out, the western
economies are running out of gas literally.

We are seeing the drums of war offshore of China in the
forcible takeover of the Spratleys from the Philippines
and Vietnam, merely for the sake of oil rights.

The crisis comes when the OPEC members flip from supplying
enough oil cheaply to keep the western economies humming along,
to stiffing the west through exorbitant prices. We are seeing the
beginnings of the outright political use of oil in Venezuela.
Where this will lead is anyone's guess. None of my notions
are very pleasant at this point.

Bottom line, the major world wars in recent history, have
involved oil, and needed gold to finance them -- paper just
seems to burn up in battle.

What were Vietnam and Korea about? I have no idea, other
than simple aggression for aggression's sake, and it needing a counter.
I guess I could see Korea get involved with Iraq, and Pakistan
just for the jollies based on their past actions. China and Japan
are bigger enigmas needing both oil and gold to extend their
economies.

We are headed for interesting times.

Regards

BParady