Transcript: Georgia and Oil rant, 11 August 2008
Thom fits recent events in Georgia into a historical context and into the competition for oil.
Thom Hartmann's Georgia and Oil rant, 11 August 2008
This is a very, very serious situation, what's going on in Georgia, and I want to take it, bring it out to the whole great big picture because the media won't do it. The corporate media won't do it. And the Republican Party definitely won't do it and the Democrats probably won't do it because they're all, by and large, to one degree or another, complicit in how this all came about. So let's just kind of play the way back machine here, all the way back to 1860. In 1860, I think it was 1865 or 1867 , the first oil well, Colonel Drake drilled the first oil well in the United States in Titusville, Pennsylvania, the first gusher and thus began the American era of oil. And we had a hell of a lot of oil in the United States. Pennzoil was the Pennsylvania Oil Company.
There were oil wells all over Pennsylvania. There were oil wells all over New Jersey. That's why there's so many refineries there. There were oil wells all over New York, there were oil wells all over Ohio. There were oil wells in Michigan. There were oil wells all across the east coast and through the mid west as the search for oil travelled west, and what happened from the 1860s to the 1870s, 1880s, 1890s is we started just pumping those wells dry.
But we could always discover more. And then we discovered oil in Oklahoma. And then we discovered oil in Texas. And then we discovered oil in California. And the oil, and so there was always more oil.
And so right up through World War II, the United States was supplying all of its own oil. And we had, by World War II, we had an entirely oil-based economy. Oil was providing for well over 95, probably more than 99% of our transportation. It was making most of our electricity, we were using coal for some of it, remnants from the 19th century, but mostly it had shifted over to oil.
We were using oil for plastics. We were using oil to make fertilizers. We were using oil to make herbicides and pesticides. We were using oil to fuel the machinery of agriculture and transport agricultural goods. We were using oil to manufacture plastics and pharmaceuticals and cosmetics and lubricants. I mean, right across the board, we had, and continue to have, an economy that existed only because of oil. Virtually everything we did was in some way intricately intertwined with oil. And it was American oil. Because the United States was pumping its own oil up until 1945.
World war II caused us to use, just in fighting World War II, we used one third of all the total of all the oil that we had in the United States, of all our oil reserves at that point in time. It was a massive amount of oil we used fighting World War II. But it was one of the things that allowed us to beat the Germans and the Japanese, because Hitler ran out of oil and Tojo never had any oil to begin with. In fact, there's a good argument to be made that the reason why he struck us at Pearl Harbor is because we had blocked the straits just to the west of Japan which was the major oil shipping route there and blocked the shipments of oil into Japan. And they had to. They had no choice.
So, Roosevelt figured this out and he said, you know, we're going to, you know, this wasn't rocket science to figure it out, but World War II really brought it to high relief. And he realized that over time, America's appetite for oil was going to be greater than our supply of oil, and we had to come up with more oil supplies.
And around that time oil was discovered in Saudi Arabia. And what was clear was that that one little country, Saudi Arabia, had more oil than all of the United States. I mean, there's just a massive amount of oil in Saudi Arabia.
And so Roosevelt in 1945 hosted the King of Saudi Arabia. No records were ever kept. There are photos of it, there's documentary evidence, but there was no records kept of the conversations. He hosted the King of Saudi Arabia on a USS aircraft carrier and the king brought along his slaves and his astrologers and his Bedouin warriors, I mean, this was, this guy was, I mean this was like, you know, a Bedouin tribe, you know, very, very poor. And the deal that Roosevelt made essentially was 'you give us your oil, and you let American companies develop your oil, and we will protect you, you, the king. We will guarantee your power'.
This was in 1945. And that doctrine was followed by Harry Truman. Truman came out with the Truman doctrine which talked about containing communism but in large part was code for 'we're going to protect the oil supplies of the Middle East'.
This led to the Eisenhower doctrine, which said the same thing. All of these guys gave some rather substantive speeches on this issue.
But still we weren't importing all that much oil. I mean, throughout the 40s, the 50s and the 60s we were importing less than 5% of our oil. And then the 70s came. And our oil imports were pushing up into the 20% region and Jimmy Carter was president and there was this moment in time, you know, war happened in the Middle East, the Arabs cut off our oil because we supported Israel, we saw a spike in oil prices. Louise and I were living in Detroit at the time. She was pregnant with our oldest daughter. And I remember living in this big city. The stores emptied in about 2 or 3 days. I remember people being shot at at the gas stations. People getting in fights and people killing each other in the gas stations because there was no gas. We went to odd / even license plates in Michigan. There was just a, you know, and the Teamsters went on strike and there was no food being delivered to the stores and the shelves were emptied and people were hoarding and it was, and this was just because one small part of the world, just a handful of countries, said, 'we're not going to export oil to the United States'.
And at that time we were only importing about 20% our oil. So Jimmy Carter saw this as an opportunity. Jimmy Carter said, 'I can change the direction of America with this, and this would be a good thing'. And so on July 15th 1979 Jimmy Carter came out and he said, 'we've got to fundamentally change things'. Here we are, we're importing about 20% our oil from foreign countries and only a small fraction of that actually was coming from Saudi Arabia, only about 5 or 6%. Most of it was coming from Mexico, from Canada, from Venezuela, from other sources, but nonetheless he said, 'we're not going to import any more
foreign oil'. Here's his speech:
The energy crisis is real. It is worldwide. It is a clear and present danger to our nation. These are facts and we simply must face them... What I have to say to you now about energy is simple and vitally important. Point one, I am tonight setting a clear goal for the energy policy of the United States. Beginning this moment, this nation will never use more foreign oil than we did in 1977 -- never.
Now, truth be told, there was a plan B. And the plan B was to have a strong presence in the Middle East, the Shah of Iran was our stabilizing influence in the Middle East and we had military bases there and that would protect our oil supplies.
But at the same time Carter put into place a whole series of programs that would reduce our dependence on oil so that we would never import more oil than we had in 1977 when our oil imports were less than 20% our total consumption.
By the way, right now we're importing about 60% our oil.
Carter went on to say we were going to do this with electricity as well and he talked about creating the nation's first solar bank:
I will soon submit legislation to Congress calling for the creation of this nation's first solar bank, which will help us achieve the crucial goal of 20 percent of our energy coming from solar power by the year 2000.
So, if Jimmy Carter's policies had been followed, we would now, instead of being, importing 60% our oil, and, you know, a chunk of that, a sizable chunk of that, from the Middle East, we would only be importing 20% of our oil or less. And we would be generating over 20% our electricity from solar and, you know, obviously wind and all kinds of other things right now.
But Carter, that was 1999 , the Shah fell, the Middle East got destabilized, and Jimmy Carter left office and Ronald Reagan came in with all this oil money and all this oil power.
And so our addiction to oil continued.
Reagan said, 'just throw the spigots open'. He cut another deal with the Saudis, he hosted the Saudis and we had the Reagan doctrine. I mean, this was after the Roosevelt, the Truman, the Eisenhower, the Nixon, the Carter and then the Reagan doctrine which was basically, you know, we are going to defend our strategic interests in the Middle East aka oil.
I mean, the best estimates from conservative think tanks is that just last year in military force alone, setting side the Iraq war, we spent over $160 billion defending our oil supplies around the world. That's a, the price of oil, that's, it's like an extra $5 a gallon on all the gasoline in the United States that we're paying through income taxes instead of gasoline tax.
So how does this take us to what's going on in Georgia? I'll tell you right after the break.
"I'm free any old time to get what I want", Rolling Stones
Well, see, that's what we've been doing all over the wold, we've been getting what we want. We are 5% of the world's population and we consume 25% of the world's oil. And just 20 years ago China was an insignificant proportion of the world's oil and they are now in the direction of consuming, we don't have exact figures but, you know, there's a whole load of guesses somewhere between 10 and 20% of the world's oil. I mean, it's just, it's absolutely massive.
And so anyhow we were up to Carter and after Carter, of course, Reagan said, 'ah, you know, to hell with all this alternative energy stuff, we're going to stay on oil'. And then Saddam Hussein takes Kuwait. And George Bush senior says no. It's about the oil.
Our jobs, our way of life, our own freedom and the freedom of friendly countries around the world would all suffer if control of the world's great oil reserves fell into the hands of that one man, Saddam Hussein.
And there he was, and this is how Bush initially tried to sell the war in Iraq.
The first Gulf War. And immediately there was blowback. Americans all over the country, I mean, there were protests, 'no blood for oil', people holding these signs out. And so very, very quickly the first Bush administration changed the rationale from 'we're going to prevent Saddam Hussein from controlling all of that oil', and Dick Cheney had in fact made the comment, you know, Saddam Hussein, you know, Iraq, well here he is:
Iraq sits on top of 10 percent of the world's oil reserves, very significant reserves, second only to Saudi Arabia.
And then he made the point that if Iraq took Kuwait, they would control 20% the world's oil reserves. And that was intolerable. That was intolerable.
And so Bush elder sold the Gulf War as 'we're trying to free Kuwait', which itself had not been free before. It was a dictatorship before, it's a dictatorship again, but oh yeah, we're free now. We actually wanted the oil.
And then came the war in Iraq. And there was that moment when George Bush junior is declaring the war and he looks at the camera and he says,
"And now I'd like to talk to the Iraqi people". And we were all expecting him to say something like, "you know, we've got the biggest army in the world, we're going to kick your butts, just lay down your weapons and nobody will get hurt and it will be fine. Everything will be fine. That's not what he said. Instead he said this:
Your fate will depend on your actions. Do not destroy oil wells.
And all over the world people's jaws dropped and everybody got it that in fact Operation Iraqi Liberation, which is what the original name was, until they realized that the acronym was rather unfortunate, for Operation Iraqi Liberation they changed it from OIL to Operation Iraqi Freedom as soon as the press reported that that was going to be it. And we got the war in Iraq which, frankly, is all about oil.
Now, you've got and then, you know, of course you've had even politicians pointing this out. Here is Hillary Clinton talking about George Bush:
President Bush is over in the Gulf now begging the Saudis and others to drop the price of oil. How pathetic.
But see, he really had no choice. That's what it has come to.
So now you have Russia industrializing and needing more and more oil, although they also are a major producer of oil. You've got China industrializing and needing more and more oil. China is buying up the oil all over Africa. We have just started AFRICOM like CENTCOM was created during the Reagan administration at the US Central Command to control and regulate the oil supplies of the Middle East. And we were, you know, quite open about this. I mean, there was one point after the Iranian revolution during the Reagan administration when the Kuwaiti tankers were coming under attack from Iran. You know, Iran is right there at the Straits of Hormuz, where they were coming under attack from Iranian gunboats, and so we reflagged them as American tankers and took the US fleet in there. And Reagan created CENTCOM in I think it was '83, '84, '85 [January 1, 1983] but somewhere there in the early to mid 80s created CENTCOM to protect our oil supplies.
Now we've created, Bush has created, AFRICOM to protect oil supplies, US oil supplies in Africa.
We're competing with the Chinese for African oil. We're competing with Russia for oil from the Caspian region, from the Caucasus mountains. From the oil rich and oil producing areas of southern, south of Russia and north of Turkey and Greece.
And the direct result, or Turkey and Armenia, rather. And that is, by the way, Georgia. There is a major oil pipe line running right through Georgia where a lot of that oil is being transported over to the Black Sea where it can get to the west and I'm telling you, what's going on here is Russia is saying, 'we're going to control this oil'.
And the thing that makes this so dangerous is that we may well be saying, given that we have, going all the way back to Franklin Roosevelt, though Roosevelt, Truman, Eisenhower, Nixon because we ignored Jimmy Carter, because Reagan became president and rolled back the Carter doctrine of stopping the US dependence on foreign oil, and instead increased our addiction to foreign oil to the point that we're now at 60% and according to the administration, according to Cheney's own energy administration, his own energy policy study group, we're going to have 70% of our oil imported within the next 15 years.
Now, we're so addicted to this that we're having to use military force all over the world. What are we going to do if the Russians end up controlling the oil out of the Caspian sea and that whole region of the world?
If the Chinese end up controlling the oil in Africa? They've already cut the deal with the Sudanese, they're cutting deals all over Africa. We've got Nigeria in the bag but there's others that are in play if the Russians and Chinese end up controlling this oil, we are going to be really screwed.
So now is the time that instead of saying we're going to play belligerent, we're going to fight, we're going to kick ass, we're going to take that oil, now is the time that we need to do a Manhattan project to become oil independent. It's not going to happen under this administration. But we need to be planning for it now.
So here's my point. We have had a foreign policy since 1945 that has been dependent in large part on protecting the oil supplies from the Middle East. It has led us into increased addiction and dependency to those oil supplies and the consequence of that, and the only president to have seriously pushed back on that was Jimmy Carter, and he was ignored. I mean, he was actually successful in getting the legislation passed, but, you know, the October Surprise, the fall of the Shah, the taking of the hostages, the whole October Surprise thing that Reagan and Bill Casey put together, threw him out of office, Reagan came in, rolled it back and said, 'no, no, we're going to continue, you know, let the good times roll'. It's just like the Republican tax and spend, borrow and spend policies; it's the pump and use policies.
And what I am saying is that what we need to be doing right now, we need to be doing a whole series of things like the Germans are doing, where they're saying if you put solar panels on your roof, then the bank, we will subsidize the banks, well actually, we'll protect them. They'll make a profit. They give you a loan at 2%, a ten year mortgage at 2% and it's guaranteed profit to them because we'll 100% back them up. So they're not going to lose money on it. So, but they're not going to make a lot of money, but they're not going to lose money. So you get a 2% mortgage for 10 years to solarize your house and then any electricity that you create from your home that is in excess of what you're using runs your meter backwards and you sell the power company and the power company must buy it from you at 7 times the retail rate. Because that's the cost over a 10 year period of building a new power plant, is 7 times the retail rate of all the users. That 7 times the retail rate happens to be the same amount of money as the mortgage would cost. So basically selling the electricity pays off the mortgage. At the end of 10 years you simply sell it back to the power company at 100% of their cost to you, in other words it's just like normal and you own the solar system, so that everybody in the country now has solar panels on their roofs.
Germany in the last 10 years has been able to generate so much solar power with this program that they have not had to build 2 new nuclear power plants. And they're actually winding down the ones they have.
Denmark is producing 19% of their electricity from wind power now. They're talking about having the government subsidize the Danish auto manufacturers to manufacture electric cars that will plug into the grid during the day at work and feed power into the grid during maximum demand for electricity time and then at night when the wind is blowing just fine, thank you very much, but nobody needs electricity, those cars will be recharged while they're at home and they'll be taking that wind power down and storing it. So all the millions of cars in Denmark become a giant, massive electrical storage system. They're moving ahead on this.
But these are the things that we need to do. If we were to drill in ANWR tomorrow, if we were to say OK to the oil companies drill in ANWR, it's all yours, it's going to take them 5 to 10 years before they can even get their act together, number one. Number 2, it won't be enough oil to make any kind of significant difference. We're talking, we're using 20 million barrels of oil a day.
It's going to go, at current trends, it's going to go to 25 million barrels a day within 15 or 20 years, although frankly I don't think those trends are going to continue, but lets say it just stays at 20 million barrels a day.
And right now, you know, 11, 12, 13, 14 million barrels of that is imported. Say we can get a half million barrels a day out of the north slope, which would be generous. I mean, the most optimistic estimates anybody put forward, particularly given the constraints of a pipeline, is 800,000, that's less than a million barrels a day. We are consuming 20 million barrels a day. It's a drop in the bucket and even if, and at that pump rate, by the way, it would only last 7 years. But it wouldn't even be available for 10 years.
Solar panels are available today. Windmills are available today. Local communities can go energy independent today. This is a crisis and I'm telling you, the war in Georgia is about the Soviet Union following the Reagan policy of saying, 'we're going to use oil, we're going to control the world's oil'.
And China's militarization, China's military is growing faster than any military of any country on Earth and next year they're going to surpass us as the largest manufacturing force on the planet. Their economy is going to be larger than ours, their military will soon be larger than ours and we're going to be facing, if we continue down this road of saying that our goal, our job is to be the nation's [world's] policeman and we're doing it to protect our oil supplies we are screwed. We are going to see World War III writ large.
And the conflict in Georgia right now is the, is, I was going to say the first indicator of it, actually I'd say the war in Iraq, Bush's oil war in Iraq the first indicator Georgia is the second.
We are now seeing, back in 1994, 1995, the book was published in '96, I wrote The Last Hours of Ancient Sunlight, and in that book in 1995 I wrote within a decade we would be seeing wars for oil. And here we are.
Transcribed by Sue Nethercott.