The Geopolitics Of World War III

Contrary to popular belief, the conduct of nations on the international stage is almost never driven by moral considerations, but rather by a shadowy cocktail of money and geopolitics. As such, when you see the mouthpieces of the ruling class begin to demonize a foreign country, the first question in your mind should always be "what is actually at stake here?"

The U.S. dollar is a unique currency. In fact its current design and its relationship to geopolitics is unlike any other in history. Though it has been the world reserve currency since 194 this is not what makes it unique. Many currencies have held the reserve status off and on over the centuries, but what makes the dollar unique is the fact that since the early 1970s it has been, with a few notable exceptions, the only currency used to buy and sell oil on the global market.

Prior to 1971 the U.S. dollar was bound to the gold standard, at least officially. According to the IMF, by 1966, foreign central banks held $14 billion U.S. dollars, however the United States had only $3.2 billion in gold allocated to cover foreign holdings.

Translation: the Federal Reserve was printing more money than it could actually back.

The result was rampant inflation and a general flight from the dollar.

In 1971 in what later came to be called the "Nixon Shock" President Nixon removed the dollar from the gold standard completely.

At this point the dollar became a pure debt based currency. With debt based currencies money is literally loaned into existence.

Approximately 70% of the money in circulation is created by ordinary banks which are allowed to loan out more than they actually have in their accounts.
The rest is created by the Federal Reserve which loans money that they don't have, mostly to government.


Kind of like writing hot checks, except it's legal, for banks. This practice which is referred to as fractional reserve banking is supposedly regulated by the Federal Reserve, an institution which just happens to be owned and controlled by a conglomerate of banks, and no agency or branch of government regulates the Federal Reserve.

Now to make things even more interesting these fractional reserve loans have interest attached, but the money to pay that interest doesn't exist in the system. As a result there is always more total debt than there is money in circulation, and in order to stay afloat the economy must grow perpetually.

This is obviously not sustainable.

Now you might be wondering how the dollar has maintained such a dominant position on the world stage for over forty years if it's really little more than an elaborate ponzi scheme.

Well this is where the dollar meets geopolitics.

In 1973 under the shadow of the artificial OPEC oil crisis, the Nixon administration began secret negotiations with the government of Saudi Arabia to establish what came to be referred to as the petrodollar recycling system. Under the arrangement the Saudis would only sell their oil in U.S. dollars, and would invest the majority of their excess oil profits into U.S. banks and Capital markets. The IMF would then use this money to facilitate loans to oil importers who were having difficulties covering the increase in oil prices. The payments and interest on these loans would of course be denominated in U.S. dollars.

This agreement was formalized in the "The U.S.-Saudi Arabian Joint Commission on Economic Cooperation" put together by Nixon's Secretary of State Henry Kissinger in 1974.

Another document released by the Congressional Research Service reveals that these negotiations had an edge to them, as U.S. officials were openly discussing the feasibility of seizing oil fields in Saudi Arabia militarily.

In the United States, the oil shocks produced inflation, new concern about foreign investment from oil producing countries, and open speculation about the advisability and feasibility of militarily seizing oil fields in Saudi Arabia or other countries. In the wake of the embargo, both Saudi and U.S. officials worked to re-anchor the bilateral relationship on the basis of shared opposition to Communism, renewed military cooperation, and through economic initiatives that promoted the recycling of Saudi petrodollars to the United States via Saudi investment in infrastructure, industrial expansion, and U.S. securities.

The system was expanded to include the rest of OPEC by 1975.

Though presented as buffer to the recessionary effects of rising oil prices, this arrangement had a hidden side effect. It removed the traditional restraints on U.S. monetary policy.

The Federal Reserve was now free to increase the money supply at will. The ever increasing demand for oil would would prevent a flight from the dollar, while distributing the inflationary consequences across the entire planet.

The dollar went from being a gold back currency to a oil backed currency. It also became America's primary export.

Did you ever wonder how the U.S. economy has been able to stay afloat while running multibillion dollar trade deficits for decades?

Did you ever wonder how it is that the U.S. holds such a disproportionate amount of the worlds wealth when 70% of the U.S. economy is consumer based?

In the modern era, fossil fuels make the world go round. They have become integrated into every aspect of civilization: agriculture, transportation, plastics, heating, defense and medicine, and demand just keeps growing and growing.

As long as the world needs oil, and as long as oil is only sold in U.S. dollars, there will be a demand for dollars, and that demand is what gives the dollar its value.

For the United States this is a great deal. Dollars go out, either as paper or digits in a computer system, and real tangible products and services come in. However for the rest of the world, it's a very sneaky form of exploitation.

Having global trade predominately in dollars also provides the Washington with a powerful financial weapon through sanctions. This is due to the fact that most large scale dollar transactions are forced to pass through the U.S.

This petrodollar system stood unchallenged until September of 2000 when Saddam Hussein announced his decision to switch Iraq's oil sales off of the dollar to Euros. This was a direct attack on the dollar, and easily the most important geopolitical event of the year, but only one article in the western media even mentioned it.

In the same month that Saddam announced he was moving away from the dollar, an organization called the “The Project for a New American Century”, of which Dick Cheney just happened to be a member, released a document entitled “REBUILDING AMERICA’S DEFENSES Strategy, Forces and Resources For a New Century”. This document called for massive increases in U.S. military spending and a much more aggressive foreign policy in order to expand U.S. dominance world wide. However the document lamented that achieving these goals would take many years “absent some catastrophic and catalyzing event – like a new Pearl Harbor”.

One year later they got it.

Riding the emotional reaction to 9/11, the Bush administration was able to invade Afghanistan and Iraq and pass the patriot act all without any significant resistance.

There were no weapons of mass destruction in Iraq, and this wasn't a question of bad intelligence. This was a cold calculated lie, and the decision to invade was made in full knowledge of the disaster which would follow.

They knew exactly what was going to happen but in 2003, they did it anyway. Once Iraqi oil fields were under U.S. control, oil sales were immediately switched back to the dollar. Mission accomplished.

Soon after the invasion of Iraq the Bush administration attempted to extend these wars to Iran. Supposedly the Iranian government was working to build a nuclear weapon. After the Iraq fiasco Washington's credibility was severely damaged as a result they were unable to muster international or domestic support for an intervention. Their efforts were further sabotaged by elements within the CIA and Mossad who came forward to state that Iran had not even made the decision to develop nuclear weapons much less begin an attempt. However the demonization campaign against Iran continued even into the Obama administration.

Why?

Well, might it have something to do with the fact that since 2004 Iran has been in the process of organizing an independent oil bourse? They were building their own oil market, and it wasn't going to be tied to the dollar. The first shipments of oil were sold through this market in July of 2011.

Unable to get the war that they wanted, the U.S. used the U.N to impose sanctions against Iran. The goal of the sanctionswas to topple the Iranian regime. While this did inflict damage on the Iranian economy, the measures failed to destabilize the country. This was due in large part to Russia's assistance in bypassing U.S. banking restrictions.

In February of 2009 Muammar Gaddafi, was named chairman of the African Union. He immediately proposed the formation of a unified state with a single currency. It was the nature of that proposed currency that got him killed.

In March of 2009 the African Union released a document entitled "Towards a Single African Currency". Pages 106 and 107 of that document specifically discuss the benefits and technicalities of running the African Central bank under a gold standard. On page 94 it explicitly states that the key to the success of the African Monetary Union would be the "eventual linking of a single African currency to the most monetary of all commodities - gold." (Note that the page number is different on other versions of the document that they released.)

In 2011 the CIA moved into Libya and began backing militant groups in their campaign to topple Gaddafi and the U.S. and NATO pushed through and stretched a U.N. nofly-zone resolution to tip the balance with airstrikes. The presence of Al-Qaeda extremists among these rebel fighters was swept under the rug.

Libya, like Iran and Iraq had committed the unforgivable crime of challenging the U.S. dollar.

The NATO intervention in Libya segued into a covert war on Syrian. The armories of the Libyan government were looted and the weapons were shipped via Turkey to Syrian rebels groups working to topple Assad. It was already clear at this point that many of these fighters had ties to terrorist organizations. However the U.S. national security apparatus viewed this as a necessary evil. In fact the Council on Foreign relations published an article in 2012 stating that "The influx of jihadis brings discipline, religious fervor, battle experience from Iraq, funding from Sunni sympathizers in the Gulf, and most importantly, deadly results. In short, the FSA needs al-Qaeda now."

The campaign for regime change in Syria, as in Libya has been presented in terms of human rights. Obviously this isn't the real motive.

In 2009, Qatar put forth a proposal to run a natural gas pipeline through Syria and Turkey to Europe. Assad however rejected this, and in 2011 he forged a pact with Iraq and Iran to run a pipeline eastward cutting Qatar and Saudi Arabia out of the loop completely. Not surprisingly Qatar, Saudi Arabia and Turkey have been the most aggressive regional players in the push to topple the Syrian government.

But why would this pipeline dispute put Syria in Washington's cross hairs? Three reasons:

1. This pipeline arrangement would significantly strengthen Iran's position, allowing them to export to European markets without having to pass through any of Washington's allies. This obviously reduces the U.S. government's leverage.

2. Syria is Iran's closest ally. It's collapse would inherently weaken Iran.

3. Syria and Iran have a mutual defense agreement, and a U.S. intervention in Syria could open the door to open conflict with Iran.

In February of 2014 this global chess game heated up in a new venue: Ukraine. The real target however was Russia.

You see Russia just happens to be the worlds second largest oil exporter, and not only have they been a thorn in Washington's side diplomatically, but they also opened an energy bourse in 2008, with sales denominated in Rubles and gold. This project had been in the works since 2006. They have also been working with China to pull off of the dollar in all of their bilateral trade.

Russia has also been in the process of organizing a Eurasian Economic Union which includes plans to adopt common currency unit, and which is slated to have its own independent energy market.

Leading up to the crisis in Ukraine had been presented with a choice: either join the E.U. under an association agreement or join the Eurasian Union. The E.U. insisted that this was an either or proposition. Ukraine couldn't join both. Russia on the other hand, asserted that joining both posed no issue. President Yanukovich decided to go with Russia.

In response the U.S. national security apparatus did what it does best: they toppled Yanukovich and installed a puppet government. To see the full evidence of Washington's involvement in the coup watch "The ukraine crisis what you're not being told"

This article from the Guardian is also worth reading.

Though this all seemed to be going well at first, the U.S. quickly lost control of the situation. Crimea held a referendum and the people voted overwhelmingly to secede from Ukraine and reunify with Russia. The transition was orderly and peaceful. No one was killed, yet the West immediately framed the entire event as an act of Russian aggression, and this became the go to mantra from that point on.

Crimea is important geostrategically because of its position in the Black Sea which allows for the projection of naval power into the Mediterranean. It has also been Russian territory for most of recent history.

The U.S. has been pushing for Ukraine's inclusion into NATO for years now. Such a move would place U.S. forces right on Russia's border and could have potentially resulted in Russia losing their naval base in Crimea. This is why Russia immediately accepted the results of the Crimean referendum and quickly consolidated the territory.

Meanwhile in Eastern Ukraine, two regions declared independence from Kiev and held referendums of their own. The results of which overwhelmingly favored self rule.

Kiev responded to this with what they referred to as anti-terrorist operations. In practice this was a massive and indiscriminate shelling campaign which killed thousands of civilians. Apparently killing civilians didn't qualify as aggression to the West. In fact the IMF explicitly warned the provisional government that their 17 billion dollar loan package could be in danger if they were not able to put down the uprising in eastern Ukraine.

While the war against eastern Ukraine was raging elections were held and Petro Poroshenko was elected president. It turns out that Poroshenko, was exposed by a leaked diplomatic cable released by wikileaks in 2008 as having worked as a mole for the U.S. State Department since 2006. They referred to him as "Our Ukraine insider" and much of the cable referred to information that he was providing. (A separate cable showed that the U.S. knew Poroshenko was corrupt even at that point.)

Having a puppet in place however hasn't turned out to be enough to give Washington the upper hand in this crisis. What does Washington do when they have no other leverage? They impose sanctions, they demonize and they saber rattle (or pull a false flag).

This isn't a very good strategy when dealing with Russia. In fact it has already backfired. The sanctions have merely pushed Russia and China into closer cooperation and accelerated Russia's de-dollarization agenda. And in spite of the rhetoric, this has not led to Russia being isolated. The U.S. and NATO have put a wedge between themselves and Russia, but not between Russia and the rest of the world (look up BRICS if you are unclear about this).

This new anti-dollar axis goes deeper than economics. These countries understand what's at stake here. This is why in the wake of the Ukrainian crisis China has proposed a new Eurasian security pact which would include Russia and Iran.

Consider the implications here as the Obama administration begins bombing in Syria which also has a mutual defense agreement with Iran.

This is not the cold war 2.0. This is World War 3.0. The masses may not have figured it out yet, but history will remember it that way.

Alliances are already solidifying and and a hot war is underway on multiple fronts. If the provocations and proxy wars continue, it's only a matter of time before the big players confront each other directly, and that is a recipe for disaster.

Does all of this sound insane to you? Well you're right. The people running the world right now are insane, and the public is sleep walking into a tragedy. If you want to alter the course that we are on, there's only one way to do it. We have to wake up that public. Even the most powerful weapons of war are neutralized if you reach the mind of the man behind the trigger.

How do we wake the masses you ask? Don't wait for someone else to answer that for you. Get creative. Act like you children's and grandchildren's futures depend on it, because they do.

US Dollar Will Be DeThroned As World's Defacto Currency

Canadian billionaire businessman Ned Goodman predicts the end of the U.S. Dollar as the world's reserve currency. He predicts the transition out of the U.S. Dollar will become, "...quite ugly."

Lecture at Cambridge House's Toronto Resource Investment Conference 2013 on Thursday, September 12, 2013.

"In my view, the dollar is about to become dethroned as the world's de facto currency. I'll tell you how I came to that conclusion so quickly... the new President of China, Xi Jinping, his first visit on the day of his becoming President, was at his request to meet with Mr. Putin. And he immediately made a deal with Mr. Putin to get all the oil that he needs, which he can buy in Renminbi."

"We're headed to a period of stagflation, maybe serious inflation, but stagflation for sure, and the United States will be losing the privilege to print at its will, the world's reserve currency. A period that's going to be very inflationary, and I can tell you that before that happens, it is likely that it is going to get quite ugly." - Ned Goodman

WW III: The Unthinkable Cost Of Preserving The Petrodollar

As noted by many of our readers, one of the key topics omitted from our article on the inevitability of economic collapse was the petrodollar system. Due to its significance, we felt that this subject deserves its own article. If you have never heard of the petrodollar, don’t be surprised. There’s a good reason for this. No major news network will dare touch this subject because if this information was ever to become public knowledge, politicians would find it next to impossible to convince American people to support any more wars. Public approval of wars is only possible as long as people remain ignorant of the primary driving force behind our foreign policy. The reason you haven’t heard of the petrodollar system is because our government wants you to think that we start wars to spread democracy.

However, if you want to distinguish truth from propaganda, if you want to know the real reasons behind the global conflicts in our recent history, you must first learn about the petrodollar system. Without this crucial piece of info, you will have a hard time understanding what really happened in Libya, what’s happening in Syria right now and what’s going to happen in Iran next.

Why did NATO and the U.S. aid Libyan “rebels” in killing Gaddafi? Why was our government willing to support and arm the same terrorists that would later turn on our embassy and murder US Ambassador to Libya, Chris Stevens? Why was killing Gaddafi so absolutely imperative?

Why are we now doing the same thing in Syria? Why are U.S. operatives currently on the ground in Syria aiding Al Qaeda to topple Assad? Why are we willing to work along side known terrorists just to destabilize Syria and overthrow the regime there?

Why are we willing to risk World War 3 by attacking Iran, a key ally to Russia and China?

Pakistan and North Korea already possess a nuclear stockpile, but Iran is years away from developing a nuclear weapon. Iran has no military capability to target the U.S. and it has not attacked another country since 1798. Yet the media is trying to convince us that we are weeks away from Ahmedinajad unleashing his non-existent weapons of mass destruction. Sound a little familiar? Have we heard this before, maybe?

So what is the petrodollar system and why is it so important? Why is the United States willing to trigger a new world war just to maintain the hegemony of the petrodollar? To get a proper perspective we need to start with a quick historical background:

Bretton Woods Conference

In July of 1944, as World War II was still raging, 730 delegates from all 44 Allied nations gathered in Bretton Woods, New Hampshire, to setup institutions and procedures to regulate the international monetary system and to establish the rules for commercial and financial relations among the world’s major industrial states.
The Bretton Woods Agreement established the dollar as the world’s reserve currency, which meant that international commodities were priced in dollars. The agreement which gave the United States a distinct financial advantage, was made under the condition that those dollars would remain redeemable for gold at a consistent rate of $35 per ounce. The fixed dollar to gold convertibility rate established a stable platform for global economic growth.

As the issuer of the world’s reserve currency, the United States promised to print dollars in direct proportion to its gold reserves. However, this promise was based on “the honor system” since the Federal Reserve refused to allow any audits or supervision of its printing presses.

The U.S. Defaults On Its Obligation To Convert Dollars To Gold

In the years leading up to 1970, expenditures on the Vietnam war made it clear to many countries that the U.S. was printing far more money than it had gold. In response to this and the negative U.S. trade balance, nations began demanding fulfillment of America’s “promise to pay” – that is, the redemption of their dollars for gold. This of course set off a rapid decline in the value of the dollar. The situation climaxed in 1971 when France attempted to withdraw its gold and Nixon refused.

On August 15, President Nixon made a televised announcement
referred to as the Nixon shock, stating the following:
“I have directed the Secretary of the Treasury to
take the action necessary to defend the dollar
against the speculators. I have directed Secretary
Connolly to suspend temporarily the convertibility
of the dollar into gold or other reserve assets,
except in amounts and conditions determined to be
in the interest of monetary stability and in the
best interest of United States.”

This was obviously not a temporary suspension as Nixon claimed, but rather a permanent default. For the nations of the world who entrusted the United States with their gold, this action was outright theft. Overnight, dollars transformed into fiat currency and the Federal Reserve was now free to print away. By abandoning the gold standard, the U.S. government removed all restrictions from the Federal Reserve. However, the ability to print money out of thin air comes with a pitfall.

This is because each new printed dollar devalues the existing money supply already in circulation.

That is unless there is a growing demand for dollars to counterbalance the newly issued currency.

So, under the direction of the Secretary of State Henry Kissinger, a brilliant political and economic idea was soon devised referred to as the petrodollar system.

The Birth Of The Petrodollar Leads To Global Domination

In 1973, President Nixon promised King Faisal of Saudi Arabia that the US would protect Saudi Arabian oilfields from any and all invaders. In return, Saudi Arabia and by extension OPEC, agreed to sell their oil in US dollars only. Essentially, this meant that all countries purchasing oil from OPEC had to do so in US dollars, or ‘petrodollars’. This forced the world’s oil money to flow through the US Federal Reserve, creating ever-growing international demand for U.S. dollars. As if that weren’t sweet enough, as part of the deal, OPEC countries were required to invest their profits in US treasuries, bonds and bills. This strengthened the US dollar, resulting in a steady US economic growth.


While other countries exchanged their currency for the dollar (forfeiting value in the process), the U.S. simply printed more money to match their needs and purchase their oil – essentially for free.

Of course rather than exchange currencies, many countries focused on exporting goods to the U.S. to maintain their constant supply of the Federal Reserve paper. Paper went out, while everything America needed came in and in the process the United States got very, very rich. It was the largest financial con in recorded history.

As the coffers got fatter and fatter, the U.S. military machine continued to expand at an accelerated rate. The arms race of the Cold War was a game of poker. Military expenditures were the chips and the U.S. had an endless supply of chips. With the Petrodollar under its belt, the U.S. was able to raise the stakes higher and higher, outspending every other county on the planet. Until, eventually, U.S. military expenditure surpassed that of all other nations in the world combined. The Soviet Union never had a chance.

The collapse of the Communist block in 1991 removed the last counterbalance to America’s military might. The United States was now an undisputed super power with no rival. Many hoped that this would mark the beginning of a new era of peace and stability. Unfortunately, there were those in high places who had other ideas.

Petrodollar System Must Be Maintained At Any Cost

That same year, the U.S. invaded Iraq in the first Gulf War. And after crushing the Iraqi military and destroying their infrastructure, including water purification plants and hospitals, crippling sanctions were imposed on Iraq, which prevented its infrastructure from being rebuilt. These sanctions, which were initiated by Bush Sr. and sustained throughout the entire Clinton administration, lasted for over a decade and were estimated to have killed over 500,000 children. The Clinton administration was fully aware of these figures.

Excerpt from a May 5, 1996 interview:
Lesley Stahl from 60 Minutes show, asks Secretary of State
Madeleine Albright about the U.S. sanctions against Iraq:
“We have heard that a half million children have died.
I mean, that’s more children than died in Hiroshima.
And, you know, is the price worth it?“
Secretary of State Madeleine Albright replies:
“I think this is a very hard choice,
but the price–we think the price is worth it.”

What exactly was it that was worth killing 500,000 kids for? Let’s see if you can spot a pattern here.

Iraq… In November 2000, Iraq began selling its oil exclusively in euros. This was a direct attack on the petrodollar and it wasn’t going to be tolerated. In response, the U.S. government with the assistance of the mainstream media began to build up a massive propaganda campaign, claiming that Iraq had weapons of mass destruction and was planning to use them.

In 2003, the U.S. invaded Iraq. Once the U.S. had control of the country, oil sales were immediately switched back to dollars. This is particularly notable due to the fact that switching back to the dollar meant a 15-20% loss in revenue due to the euro’s higher value. It doesn’t make any sense at all unless you take the Petrodollar into account.

Excerpt from a March 2, 2007 DemocracyNow interview: 

So I came back to see him a few weeks later and by that time we were bombing in Afghanistan. I said “Are we still going to war with Iraq?” and he said, “Oh, it’s worse than that”, he reached over on his desk, picked a piece of paper and he said:
“I just got this down from upstairs today (meaning secretary of defense office) today. This is a memo that describes how we’re going take out 7 countries in 5 years, starting with Iraq and then Syria, Lebanon, Libya, Somalia, Sudan and finishing of Iran.” 

– Wesley Clark, Retired 4-Star General and Supreme Allied Commander Europe of NATO from 1997 to 2000

Libya… Muammar Gaddafi harbored the Lockerbie Bombers and allowed various terrorist organizations establish training camps in Libya. He tried to buy a nuke from China in 1972. In 1977, he approached Pakistan, then India. He sought nerve gas from Thailand. Then he did something totally insane. Gaddafi decided to move away from the petrodollar in favor of a gold-based currency. Seeking nukes and harboring terrorists is one thing, but threatening the petrodollar is quite another. Within a year, ‘internal’ elements rose up in rebellion against Gaddafi.

After taking control of the region, U.S. and NATO armed rebels executed Gaddafi in cold blood and immediately setup the Libyan Central Bank.


Iran… In 2005, Iran sought to create an Iranian Oil Exchange, thus bypassing the US controlled petrodollar. Fear that western powers would freeze accounts in European and London banks put an end to that plan. More recently however, Iran was able to secure agreements to begin trading its oil in exchange for gold. In response, the U.S. government, with mainstream media assistance has been attempting to build international support for military strikes on the pretext of preventing Iran from building a nuclear weapon. In his recent State of the Union address, Obama went as far as to say that when it comes to Iran and the insistence they dismantle their nuclear program, “no options are off the table”. By stating ‘no options’ this would include nuclear deployment as a deterrent. In the meantime, the U.S. established sanctions that, U.S. officials openly admit, are aimed at causing a collapse of the Iranian economy.

Syria… Syria is Iran’s closest ally and they’re bound by mutual defense agreements. Syria is currently being destabilized from within by the “Free Syrian Army” (FSA), in its intensifying effort to topple Assad. It is a well known fact that FSA consists of multiple terrorist factions from Afghanistan to Chechnya, most notably Al Qaeda. Yet this is not stopping United States or NATO from providing covert assistance to FSA. Despite warning from Russia and China to the United States, the White House has made statements within the past month indicating that the U.S. is considering military intervention.

However, it should be clear, that military intervention in Syria and Iran isn’t being considered. It’s a forgone conclusion, just as it was in Iraq and Libya.

World War 3: A Calculated Risk To Preserve The Petrodollar

The U.S. is actively working to create the context which gives them diplomatic cover to do what they already have planned. The motive for these invasions and covert actions becomes clear when we look at them in full context and connect the dots.

The petrodollar paradigm is saving the dollar from crashing by accomplishing two things. First, it creates a mandatory international demand for the Federal Reserve paper, preventing dollar inflation from going into hyperinflation. Second, the oil profits from OPEC pay for a portion of our ever expanding national debt, helping perpetuate a giant Ponzi scheme in the U.S. treasury market. Those who control the United States understand that even if only a few countries begin to sell their oil in another currency it will set off a chain reaction and the dollar will collapse. They understand that there’s absolutely nothing else holding up the value of the dollar at this point, and so does the rest of the world.


But rather than accepting the fact that the dollar is nearing the end of its lifespan, the powers that be have made a calculated gambit. They have decided to use the brute force of the U.S. military to crush each and every resistant state in the Middle East and Africa.

That, in and of itself, would be bad enough. But what you need to understand is that this is not going to end with Iran. China and Russia have stated publicly and in no uncertain terms that they will not tolerate an attack on Iran or Syria. Iran is one of their key allies, one of the last in independent oil producers in the region. And they understand that if Iran falls, then they will have no way to escape the dollar without going to war. And yet, the United States is pushing forward despite the warnings.

What we’re witnessing here is a trajectory that leads straight to the unthinkable.
It’s a trajectory that was mapped out years ago, in full awareness of the human consequences.

Who Is Pulling The Strings?

But who was it that put us on this course? What kind of psychopath is willing to intentionally set off a global conflict that would lead to millions of deaths just to protect the value of a paper currency?

It obviously isn’t the president. The decision to invade Libya, Syria and Iran was made long before Obama had risen to the national spotlight. And yet he’s carrying out his duty just like the puppets that preceded him. So who is it that pulls the strings?


Often the best answer to questions like these are found by asking another question. Cui bono? Who benefits?

Obviously, those who have the power to print the dollar out of thin air have the most to lose if the dollar was to fall. Since 1913, that power has been held by the Federal Reserve.

The Federal Reserve is a PRIVATE entity, owned by a conglomerate of the most powerful banks in the world. And the men who control those banks are the ones who pull the strings. To them, this is just a game. Your life and the lives of those you love are just pawns on their chess board. And like a spoiled four year old who tips the board on to the floor when he starts to lose, the powers that be are willing to start World War III to keep control of the global financial system.

Remember this when these wars extend and accelerate. Remember this when your son or your daughter comes back home in a flag draped coffin. Remember this when they point the finger at the new boogeyman.

So, What Can We Do About All This?

Today’s Geo-political climate, coupled with the desperation of the banking cartel to save the petrodollar, makes World War III a legitimate concern more than ever. If we’re lucky enough, maybe we will avoid a global military showdown between Russia, China and the West. But, we cannot avoid an economic collapse, regardless of whether WWW III is triggered or not. This is because no matter how many Mideast regimes we topple, we simply cannot stop China and Russia from dropping the dollar in the near future. Both of these countries have already signed significant agreements purposed to move them away from the dollar. Despite the best efforts of the banking cartel to preserve the petrodollar, this paradigm is starting to crumble.

So what can we do about all this? First, let’s admit the obvious. The power to prevent any of this is not in our hands. But, at the same time, we don’t have to just sit idly while the dollar is circling the drain. There are specific things we can and should do.

1. BE MORE DISCERNING

Critical thinking and common sense are in decline these days.

Rather than just swallow what we’re fed by the mainstream media, we need to question it.

Most people are just unaware that 90% of all American media is controlled by six global conglomerates that also hold assets in the military complex and oil industry, and are interconnected with major banking interests.

2. GET THE FACTS

Read both of the articles linked below and make sure to watch the videos on those pages.

Remember, be discerning. So crosscheck the info in these articles to make sure the facts are accurate.

a) Click here to see why the coming economic collapse is a mathematical fact.

b) Click here to see why “Obama vs Romney” is an illusion of choice.

The first article will convince you just how deep of a hole we’re in. The second will help you understand that we can’t depend on the government to get us out of this mess.

3. SPREAD THE TRUTH

Individually we are ineffective. But together we have a chance. The powers that be count on the sheeple to be asleep. They also count on our willful ignorance, because they know that rather than accept the unpleasant reality, people readily deny the obvious.

Still, the internet gives us a distinct advantage over the system. Social media makes it possible for information to spread among millions of people in a matter of days. We need to make articles and videos like this go viral by Tweeting, posting on Facebook, emailing everybody we know, posting on forums, etc. You can do your part right now by clicking on the floating “Share” button on the right and using some of the social media icons on that menu to share this information.

4. GET READY NOW

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The Iranian Oil Embargo Blowback

By Pepe Escobar 
January 28, 2012 
Courtesy Of "Asia Time Online"

If the sorry parade of European poodles - or what analyst Chris Floyd delightfully dubbed Europuppies - had any understanding of Persian culture, they would have known that blowback for their declaration of economic war in the form of an Iranian oil embargo would be nothing short of heavy metal. 

Better yet; death metal. The Majlis (Iranian parliament) will discuss this Sunday, in an open section, whether to cancel right away all oil exports to any European country that approved the embargo - according to Emad Hosseini, the rapporteur of the Majlis Energy Committee. And that comes with the requisite apocalyptic warning, relayed via the Fars news agency, courtesy of member of Parliament Nasser Soudani: "Europe will burn in the fire of Iran's oil wells." 

Soudani expresses the views of the whole Tehran establishment when he says that "the structure of their [Europe's] refineries is compatible with Iran's oil", and so Europeans have no alternative as replacement; the embargo "will cause an increase in oil prices, and the Europeans will be compelled to buy oil at higher prices"; that is, Europe "will be compelled to buy Iran's oil indirectly and through intermediaries". 

According to the EU sanctions package, all existing contracts will be respected only until July 1 - and no new contracts are allowed. Now imagine if this pre-emptive Iranian legislation is voted within the next few days. Crisis-hit Club Med countries such as Spain and especially Italy and Greece will be dealt a deathblow, having no time to find a possible alternative to Iran's light, high-quality crude. 

Saudi Arabia - whatever the oily spin in Western corporate media - does not have the spare capacity; and on top of it, the absolute priority for the House of Saud is high oil prices, so it can bribe - apart from repressing - its own population into forgetting about noxious Arab Spring ideas. 

So yes, already broken European economies would be forced to keep buying Iranian oil, but now from the winners of choice - middlemen vultures. 

Not surprisingly, the losers lost in these Cold War tactics anachronistically applied to a global open market are the Europeans themselves. Greece - already facing the abyss - has been buying heavily discounted oil from Iran. The strong possibility remains of the oil embargo precipitating a Greek government bond default - and even a catastrophic cascade effect in the eurozone (Ireland, Portugal, Italy, Spain - and beyond). 

The world needs a digital Herodotus to decode how these European poodles who claim to represent "civilization" were able, in a single stroke, to inflict simultaneous pain on Greece - the cradle of Western civilization itself - and Persia - one of the most sophisticated civilizations in history. In an astonishing historical replay of tragedy as farce, it's as if Greeks and Persians were bonded together at the Thermopylae facing the onslaught of North Atlantic Treaty Organization armies. 

Hit The Eurasian Groove 

Now compare it with the action all across Eurasia. Russian Foreign Minister Sergey Lavrov said, "Unilateral sanctions don't help matters". The Ministry of Foreign Affairs in Beijing, exercising immense tact, nevertheless was unmistakable; "To blindly pressure and impose sanctions on Iran are not constructive approaches." 

Turkey's Foreign Minister Ahmet Davutoglu said, "We have very good relations with Iran, and we are putting much effort into renewing Iran's talks with the 5+1 [Iran Six - the United Nations Security Council permanent members plus Germany] mediators' group. Turkey will continue looking for a peaceful solution to the issue.” 

BRICS member India - alongside Russia and China - also dismissed sanctions. India will keep buying Iranian oil and paying in rupees or gold. South Korea and Japan will inevitably extract exemptions from the Barack Obama administration. 

All across Eurasia trade is fast moving away from the US dollar. The Asian Dollar Exclusion Zone, crucially, also means that Asia is slowly disengaging itself from Western banks. 

The movement may be led by China - but it's irreversibly transnational. Once again, follow the money. BRICS members China and Brazil started bypassing the US dollar on trade in 2007. BRICS members Russia and China did the same in 2010. Japan and China - the top two Asian giants - did the same only last month. 

Only last week, Saudi Arabia and China rolled out a project for a giant oil refinery in the Red Sea. And India more or less secretly is deciding to pay for Iranian oil in gold - even bypassing the current middleman, a Turkish bank. 

Asia wants a new international system - and it's working for it. Inevitable long-term consequences; the US dollar - and, crucially, the petrodollar - slowly drifting into irrelevance. "Too Big to Fail" may turn out to be not a categorical imperative, but an epitaph. 

Pepe Escobar is the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. His new book, just out, is Obama does Globalistan (Nimble Books, 2009). 

He may be reached at pepeasia@yahoo.com. 

(Copyright 2012 Asia Times Online (Holdings) Ltd. All rights reserved.)

Sinking The Petrodollar In The Persian Gulf

By Pepe Escobar and Tom Engelhardt, 
January 18, 2012 
Courtesy Of "Anti-War"

These days, with a crisis atmosphere growing in the Persian Gulf, a little history lesson about the U.S. and Iran might be just what the doctor ordered. Here, then, are a few high- (or low-) lights from their relationship over the last half-century-plus:

Summer 1953: The CIA and British intelligence hatch a plot for a coup that overthrows a democratically elected government in Iran intent on nationalizing that country’s oil industry. In its place, they put an autocrat, the young shah of Iran, and his soon-to-be feared secret police. He runs the country as his repressive fiefdom for a quarter-century, becoming Washington’s “bulwark” in the Persian Gulf — until overthrown in 1979 by a home-grown revolutionary movement, which ushers in the rule of Ayatollah Khomeini and the mullahs. While Khomeini & Co. were hardly Washington’s men, thanks to that 1953 coup they were, in a sense, its own political offspring. In other words, the fatal decision to overthrow a popular democratic government shaped the Iranian world Washington now loathes, and even then oilwas at the bottom of things.

1967: Under the U.S. “Atoms for Peace” program, started in the 1950s by President Dwight D. Eisenhower, the shah is allowed to buy a 5-megawatt, light-water type research reactor for Tehran (which — call it irony — is still playing a role in the dispute over the Iranian nuclear program). Defense Department officials did worry at the time that the shah might use the “peaceful atom” as a basis for a future weapons program or that nuclear materials might fall into the wrong hands. “An aggressive successor to the shah,” went a 1974 Pentagon memo, “might consider nuclear weapons the final item needed to establish Iran’s complete military dominance of the region.” But that didn’t stop them from aiding and abetting the creation of an Iranian nuclear program.

The shah, like his Islamic successors, argued that such a program was Iran’s national “right” and dreamed of a country that would get significant portions of its electricity from a string of nuclear plants. As a 1970s ad by a group of American power companies put the matter: “The shah of Iran is sitting on top of one of the largest reservoirs of oil in the world. Yet he’s building two nuclear plants and planning two more to provide electricity for his country. He knows the oil is running out — and time with it.” In other words, the U.S. nuclear program was the genesis for the Iranian one that Washington now so despises.

September 1980: Iraqi ruler Saddam Hussein launches a war of aggression against Ayatollah Khomeini’s Iran. In the early 1980s, he becomes Washington’s man, our “bulwark” in the Persian Gulf, and we offer him our hand — and also “detailed information” on Iranian deployments and tactical planning that help him use his chemical weapons more effectively against the Iranian military. Oh, and just to make sure things turn out really, really well, the Reagan administration also decides to sell missiles and other arms to Ayatollah Khomeini’s Iran on the sly, part of what became known as the “Iran-Contra Affair” and which almost brings down the president and his men. Success!

March 2003: Saddam Hussein is, by now, no longer our man in Baghdad but a new“Hitler” who, top Washington officials claim, undoubtedly has a nuclear weapons program that could someday leave mushroom clouds rising over U.S. cities. So the Bush administration launches a war of aggression against Iraq, which like Iran just happens to — in the words of Deputy Secretary of Defense Paul Wolfowitz — “float on a sea of oil.” (Bush officials hope, in the wake of a “cakewalk” of a war to revive that country’s oil industry, to privatize it, and use it to destroy OPEC, driving down the price of oil on world markets.) Nine years later, a Shi’ite government is in power in Baghdad closely allied with Tehran, which has gained regional strength and influence thanks to the disastrous U.S. occupation.

So call it an unblemished record of a kind not easy to find. In more than 50 years, America’s leaders have never made a move in Iran (or near it) that didn’t lead to unexpected and unpleasant blowback. Now, another administration in Washington, after years of what can only be called a covert war against Iran, is preparing yet another set of clever maneuvers — this time sanctions against Iran’s central bank meant to cripple the country’s oil industry and crack open the economy followed by no one knows what.

And honestly, I mean, really, given past history, what could possibly go wrong? Regime change in Iran? It’s bound to be a slam dunk, and if you don’t believe it, check out Pepe Escobar, that fabulous peripatetic reporter for Asia Times andTomDispatch regular. Tom

The Myth of “Isolated” Iran

Following The Money In The Iran Crisis 
By Pepe Escobar

Let’s start with red lines. Here it is, Washington’s ultimate red line, straight from the lion’s mouth. Only last week Secretary of Defense Leon Panetta said of the Iranians, “Are they trying to develop a nuclear weapon? No. But we know that they’re trying to develop a nuclear capability. And that’s what concerns us. And our red line to Iran is do not develop a nuclear weapon. That’s a red line for us.”

How strange, the way those red lines continue to retreat. Once upon a time, the red line for Washington was “enrichment” of uranium. Now, it’s evidently an actual nuclear weapon that can be brandished. Keep in mind that, since 2005, Iranian Supreme Leader Ayatollah Khamenei has stressed that his country is not seeking to build a nuclear weapon. The most recent National Intelligence Estimate on Iran from the U.S. intelligence community has similarly stressed that Iran is not, in fact, developing a nuclear weapon (as opposed to the breakout capacity to build one someday).

What if, however, there is no “red line,” but something completely different? Call it the petrodollar line.

Banking on Sanctions?

Let’s start here: In December 2011, impervious to dire consequences for the global economy, the U.S. Congress — under all the usual pressures from the Israel lobby (not that it needs them) — foisted a mandatory sanctions package on the Obama administration (100 to 0 in the Senate and with only 12 “no” votes in the House). Starting in June, the U.S. will have to sanction any third-country banks and companies dealing with Iran’s Central Bank, which is meant to cripple that country’s oil sales. (Congress did allow for some “exemptions.”)

The ultimate target? Regime change — what else? — in Tehran. The proverbial anonymous U.S. official admitted as much in the Washington Post, and that paper printed the comment. (“The goal of the U.S. and other sanctions against Iran is regime collapse, a senior U.S. intelligence official said, offering the clearest indication yet that the Obama administration is at least as intent on unseating Iran’s government as it is on engaging with it.”) But oops! The newspaper then had to revise the passage to eliminate that embarrassingly on-target quote. Undoubtedly, this “red line” came too close to the truth for comfort.

Former chairman of the Joint Chiefs of Staff Adm. Mike Mullen believed that only a monster shock-and-awe-style event, totally humiliating the leadership in Tehran, would lead to genuine regime change — and he was hardly alone. Advocates of actions ranging from airstrikes to invasion (whether by the U.S., Israel, or some combination of the two) have been legion in neocon Washington. (See, for instance, the Brookings Institution’s 2009 report Which Path to Persia.)

Yet anyone remotely familiar with Iran knows that such an attack would rally the population behind Khamenei and the Revolutionary Guards. In those circumstances, the deep aversion of many Iranians to the military dictatorship of the mullahtariat would matter little.

Besides, even the Iranian opposition supports a peaceful nuclear program. It’s a matter of national pride.

Iranian intellectuals, far more familiar with Persian smoke and mirrors than ideologues in Washington, totally debunk any war scenarios. They stress that the Tehran regime, adept in the arts of Persian shadow play, has no intention of provoking an attack that could lead to its obliteration. On their part, whether correctly or not, Tehran strategists assume that Washington will prove unable to launch yet one more war in the Greater Middle East, especially one that could lead to staggering collateral damage for the world economy.

In the meantime, Washington’s expectations that a harsh sanctions regime might make the Iranians give ground, if not go down, may prove to be a chimera. Washington spin has been focused on the supposedly disastrous mega-devaluation of the Iranian currency, the rial, in the face of the new sanctions. Unfortunately for the fans of Iranian economic collapse, Professor Djavad Salehi-Isfahani has laid out in elaborate detail the long-term nature of this process, which Iranian economists have more than welcomed. After all, it will boost Iran’s non-oil exports and help local industry in competition with cheap Chinese imports. In sum: a devalued rial stands a reasonable chance of actually reducing unemployment in Iran.

More Connected Than Google

Though few in the U.S. have noticed, Iran is not exactly “isolated,” though Washington might wish it. Pakistani Prime Minister Yusuf Gilani has become afrequent flyer to Tehran. And he’s a Johnny-come-lately compared to Russia’s national security chief, Nikolai Patrushev, who only recently warned the Israelis not to push the U.S. to attack Iran. Add in as well U.S. ally and Afghan President Hamid Karzai. At a loya jirga (grand council) in late 2011, in front of 2,000 tribal leaders, he stressed that Kabul was planning to get even closer to Tehran.

On that crucial Eurasian chessboard, Pipelineistan, the Iran-Pakistan (IP) natural gas pipeline — much to Washington’s distress — is now a go. Pakistan badly needs energy, and its leadership has clearly decided that it’s unwilling to wait forever and a day for Washington’s eternal pet project — the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline — to traverse Talibanistan.

Even Turkish Foreign Minister Ahmet Davutoglu recently visited Tehran, though his country’s relationship with Iran has grown ever edgier. After all, energy overrules threats in the region. NATO member Turkey is already involved in covert ops in Syria, allied with hardcore fundamentalist Sunnis in Iraq, and — in a remarkable volte-face in the wake of the Arab Spring(s) — has traded in an Ankara-Tehran-Damascus axis for an Ankara-Riyadh-Doha one. It is even planning on hosting components of Washington’s long-planned missile defense system, targeted at Iran.

All this from a country with a Davutoglu-coined foreign policy of “zero problems with our neighbors.” Still, the needs of Pipelineistan do set the heart racing. Turkey is desperate for access to Iran’s energy resources, and if Iranian natural gas ever reaches Western Europe — something the Europeans are desperately eager for — Turkey will be the privileged transit country. Turkey’s leaders have already signaled their rejection of further U.S. sanctions against Iranian oil.

And speaking of connections, last week there was that spectacular diplomatic coup de théâtre, Iranian President Mahmoud Ahmadinejad’s Latin American tour. U.S. right-wingers may harp on a Tehran-Caracas axis of evil — supposedly promoting “terror” across Latin America as a springboard for future attacks on the northern superpower — but back in real life, another kind of truth lurks. All these years later, Washington is still unable to digest the idea that it has lost control of, or even influence in, those two regional powers over which it once exercised unmitigated imperial hegemony.

Add to this the wall of mistrust that has only solidified since the 1979 Islamic revolution in Iran. Mix in a new, mostly sovereign Latin America pushing for integration not only via left-wing governments in Venezuela, Bolivia, and Ecuador but through regional powers Brazil and Argentina. Stir and you get photo ops like Ahmadinejad and Venezuelan President Hugo Chavez saluting Nicaraguan President Daniel Ortega.

Washington continues to push a vision of a world from which Iran has been radically disconnected. State Department spokesperson Victoria Nuland is typical in saying recently, “Iran can remain in international isolation.” As it happens, though, she needs to get her facts straight.

“Isolated” Iran has $4 billion in joint projects with Venezuela, including, crucially, a bank (as with Ecuador, it has dozens of planned projects from building power plants to, once again, banking). That has led the Israel-first crowd in Washington to vociferously demand that sanctions be slapped on Venezuela. Only problem: How would the U.S. pay for its crucial Venezuelan oil imports then?

Much was made in the U.S. press of the fact that Ahmadinejad did not visit Brazil on this jaunt through Latin America, but diplomatically Tehran and Brasilia remain in sync. When it comes to the nuclear dossier in particular, Brazil’s history leaves its leaders sympathetic. After all, that country developed — and then dropped — a nuclear weapons program. In May 2010, Brazil and Turkey brokered a uranium-swap agreement for Iran that might have cleared the decks on the U.S.-Iranian nuclear imbroglio. It was, however, immediately sabotaged by Washington. A key member of the BRICS, the club of top emerging economies, Brasilia is completely opposed to the U.S. sanctions/embargo strategy.

So Iran may be “isolated” from the United States and Western Europe, but from the BRICS to NAM (the 120 member countries of the Non-Aligned Movement), it has the majority of the global South on its side. And then, of course, there are those staunch Washington allies, Japan and South Korea, now pleading for exemptions from the coming boycott/embargo of Iran’s Central Bank.

No wonder, because these unilateral U.S. sanctions are also aimed at Asia. After all, China, India, Japan, and South Korea, together, buy no less than 62% of Iran’s oil exports.

With trademark Asian politesse, Japan’s Finance Minister Jun Azumi let Treasury Secretary Timothy Geithner know just what a problem Washington is creating for Tokyo, which relies on Iran for 10% of its oil needs. It is pledging to at least modestly “reduce” that share “as soon as possible” in order to get a Washington exemption from those sanctions, but don’t hold your breath. South Korea has already announced that it will buy 10% of its oil needs from Iran in 2012.

Silk Road Redux

Most important of all, “isolated” Iran happens to be a supreme matter of national security for China, which has already rejected the latest Washington sanctionswithout a blink. Westerners seem to forget that the Middle Kingdom and Persia have been doing business for almost two millennia. (Does “Silk Road” ring a bell?)

The Chinese have already clinched a juicy deal for the development of Iran’s largest oil field, Yadavaran. There’s also the matter of the delivery of Caspian Sea oil from Iran through a pipeline stretching from Kazakhstan to Western China. In fact, Iran already supplies no less than 15% of China’s oil and natural gas. It is now more crucialto China, energy-wise, than the House of Saud is to the U.S., which imports 11% of its oil from Saudi Arabia.

In fact, China may be the true winner from Washington’s new sanctions, because it is likely to get its oil and gas at a lower price as the Iranians grow ever more dependent on the China market. At this moment, in fact, the two countries are in the middle of acomplex negotiation on the pricing of Iranian oil, and the Chinese have actually been ratcheting up the pressure by slightly cutting back on energy purchases. But all this should be concluded by March, at least two months before the latest round of U.S. sanctions go into effect, according to experts in Beijing. In the end, the Chinese will certainly buy much more Iranian gas than oil, but Iran will still remain its third biggest oil supplier, right after Saudi Arabia and Angola.

As for other effects of the new sanctions on China, don’t count on them. Chinese businesses in Iran are building cars, fiber optics networks, and expanding the Tehran subway. Two-way trade is at $30 billion now and expected to hit $50 billion in 2015. Chinese businesses will find a way around the banking problems the new sanctions impose.

Russia is, of course, another key supporter of “isolated” Iran. It has opposed stronger sanctions either via the U.N. or through the Washington-approved package that targets Iran’s Central Bank. In fact, it favors a rollback of the existing U.N. sanctions and has also been at work on an alternative plan that could, at least theoretically, lead to a face-saving nuclear deal for everyone.

On the nuclear front, Tehran has expressed a willingness to compromise with Washington along the lines of the plan Brazil and Turkey suggested and Washington deep-sixed in 2010. Since it is now so much clearer that, for Washington — certainly for Congress — the nuclear issue is secondary to regime change, any new negotiations are bound to prove excruciatingly painful.

This is especially true now that the leaders of the European Union have managed to remove themselves from a future negotiating table by shooting themselves in their Ferragamo-clad feet. In typical fashion, they have meekly followed Washington’s lead in implementing an Iranian oil embargo. As a senior EU official told National Iranian American Council President Trita Parsi, and as EU diplomats have assured me in no uncertain terms, they fear this might prove to be the last step short of outright war.

Meanwhile, a team of International Atomic Energy Agency inspectors has just visitedIran. The IAEA is supervising all things nuclear in Iran, including its new uranium-enrichment plant at Fordow, near the holy city of Qom, with full production starting in June. The IAEA is positive: no bomb-making is involved. Nonetheless, Washington (and the Israelis) continue to act as though it’s only a matter of time — and not much of it at that.

Follow the Money

That Iranian isolation theme only gets weaker when one learns that the country is dumping the dollar in its trade with Russia for rials and rubles — a similar move to ones already made in its trade with China and Japan. As for India, an economic powerhouse in the neighborhood, its leaders also refuse to stop buying Iranian oil, a trade that, in the long run, is similarly unlikely to be conducted in dollars. India is already using the yuan with China, as Russia and China have been trading in rubles and yuan for more than a year, as Japan and China are promoting direct trading in yen and yuan. As for Iran and China, all new trade and joint investments will be settled in yuan and rial.

Translation, if any was needed: in the near future, with the Europeans out of the mix, virtually none of Iran’s oil will be traded in dollars.

Moreover, three BRICS members (Russia, India, and China) allied with Iran are major holders (and producers) of gold. Their complex trade ties won’t be affected by the whims of a U.S. Congress. In fact, when the developing world looks at theprofound crisis in the Atlanticist West, what they see is massive U.S. debt, the Fed printing money as if there’s no tomorrow, lots of “quantitative easing,” and of course the Eurozone shaking to its very foundations.

Follow the money. Leave aside, for the moment, the new sanctions on Iran’s Central Bank that will go into effect months from now, ignore Iranian threats to close the Strait of Hormuz (especially unlikely given that it’s the main way Iran gets its own oil to market), and perhaps one key reason the crisis in the Persian Gulf is mounting involves this move to torpedo the petrodollar as the all-purpose currency of exchange.

It’s been spearheaded by Iran and it’s bound to translate into an anxious Washington, facing down not only a regional power, but its major strategic competitors China and Russia. No wonder all those carriers are heading for the Persian Gulf right now, though it’s the strangest of showdowns — a case of military power being deployed against economic power.

In this context, it’s worth remembering that in September 2000 Saddam Husseinabandoned the petrodollar as the currency of payment for Iraq’s oil, and moved to the euro. In March 2003, Iraq was invaded and the inevitable regime change occurred. Libya’s Muammar Gadhafi proposed a gold dinar both as Africa’s common currency and as the currency of payment for his country’s energy resources. Another intervention and another regime change followed.

Washington/NATO/Tel Aviv, however, offers a different narrative. Iran’s “threats” are at the heart of the present crisis, even if these are, in fact, that country’s reaction to non-stop U.S./Israeli covert war and now, of course, economic war as well. It’s those “threats,” so the story goes, that are leading to rising oil prices and so fueling the current recession, rather than Wall Street’s casino capitalism or massive U.S. and European debts. The cream of the 1% has nothing against high oil prices, not as long as Iran’s around to be the fall guy for popular anger.

As energy expert Michael Klare pointed out recently, we are now in a new geo-energy era certain to be extremely turbulent in the Persian Gulf and elsewhere. But consider 2012 the start-up year as well for a possibly massive defection from the dollar as the global currency of choice. As perception is indeed reality, imagine the real world — mostly the global South — doing the necessary math and, little by little, beginning to do business in their own currencies and investing ever less of any surplus in U.S. Treasury bonds.

Of course, the U.S. can always count on the Gulf Cooperation Council (GCC) — Saudi Arabia, Qatar, Oman, Bahrain, Kuwait, and the United Arab Emirates — which I prefer to call the Gulf Counterrevolution Club (just look at their performances during the Arab Spring). For all practical geopolitical purposes, the Gulf monarchies are a U.S. satrapy. Their decades-old promise to use only the petrodollar translates into them being an appendage of Pentagon power projection across the Middle East. CENTCOM, after all, is based in Qatar; the U.S. Fifth Fleet is stationed in Bahrain. In fact, in the immensely energy-wealthy lands that we could label Greater Pipelineistan — and that the Pentagon used to call “the arc of instability” — extending through Iran all the way to Central Asia, the GCC remains key to a dwindling sense of U.S. hegemony.

If this were an economic rewrite of Edgar Allen Poe’s story “The Pit and the Pendulum,” Iran would be but one cog in an infernal machine slowly shredding the dollar as the world’s reserve currency. Still, it’s the cog that Washington is now focused on. They have regime change on the brain. All that’s needed is a spark to start the fire (in — one hastens to add — all sorts of directions that are bound to catch Washington off guard).

Remember Operation Northwoods, that 1962 plan drafted by the Joint Chiefs of Staff to stage terror operations in the U.S. and blame them on Fidel Castro’s Cuba. (President Kennedy shot the idea down.) Or recall the Gulf of Tonkin incident in 1964, used by President Lyndon Johnson as a justification for widening the Vietnam War. The U.S. accused North Vietnamese torpedo boats of unprovoked attacks on U.S. ships. Later, it became clear that one of the attacks had never even happened and the president had lied about it.

It’s not at all far-fetched to imagine hardcore Full-Spectrum-Dominance practitioners inside the Pentagon riding a false-flag incident in the Persian Gulf to an attack on Iran (or simply using it to pressure Tehran into a fatal miscalculation). Consider as well the new U.S. military strategy just unveiled by President Obama in which the focus of Washington’s attention is to move from two failed ground wars in the Greater Middle East to the Pacific (and so to China). Iran happens to be right in the middle, in Southwest Asia, with all that oil heading toward an energy-hungry modern Middle Kingdom over waters guarded by the U.S. Navy.

So yes, this larger-than-life psychodrama we call “Iran” may turn out to be as much about China and the U.S. dollar as it is about the politics of the Persian Gulf or Iran’s nonexistent bomb. The question is: What rough beast, its hour come round at last, slouches towards Beijing to be born?

Pepe Escobar is the roving correspondent for Asia Times, a TomDispatch regular, and a political analyst for al-Jazeera and RT. His latest book is Obama Does Globalistan(Nimble Books, 2009).

Copyright 2012 Pepe Escobar