OPEN FIRE AND OPEN MARKETS: STRATEGY OF AN EMPIRE

By Anuradha Mittal Reprint | | Print |

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OAKLAND, Oct 1 2003 (IPS) - Eruptions of armed aggression by the US should not distract us from the underlying logic of economic imperialism. America\’s \’\’war for freedom\’\’ or \’\’war on terrorism\’\’ is at one with its expansionary goals for the market: open invasion in some places, and open markets everywhere. In this article for IPS, the author writes that the plans for Iraq go beyond reconstruction. The intention is to create a dream economy — completely privatised and foreign-owned. The war on Iraq was shadowed by a battle among American corporations to win reconstruction contracts. Resistance to the unilateral US strategy does not go over well. In March 2003, President Bush alluded to the possibility of reprisals if Mexico didn\’t vote America\’s way in the UN Security Council on the question of Iraq. In July 2003, the administration cut off military aid to 35 friendly countries in retaliation for their support of the International Criminal Court (ICC). And following the collapse of trade talks in Cancun, the US is threatening \’\’to take note\’\’ of those countries that \’\’torpedoed\’\’ the negotiations in Cancun. However, the US position as a solo superpower could be short-lived. Washington\’s desire to dominate affairs around the world has created a global resistance stoked by a combination of developing country resentments inflamed by US arrogance, a crippled economy, an expensive invasion and occupation of Iraq that has not gone well for the US, and reinvigorated civil society resistance to corporate driven globalisation.

Eruptions of armed aggression by the US should not distract us from the underlying logic of economic imperialism. America’s ”war for freedom” or ”war on terrorism” is at one with its expansionary goals for the market: open invasion in some places, and open markets everywhere.

The recolonisation of the South by the US is a carefully crafted strategy. First it cut its UN contributions. Then it shrank aid to the Third World, using its trade agenda as a justification. It uses both carrots –trade agreements for acquiescent states like Israel and Jordan, military aid and graft for once-”friendly” Iraq and Afghanistan– and sticks –embargoes and bombs for non-compliant nations such as Cuba and out-of-favour Afghanistan and Iraq.

Today there is an escalation of both these techniques. For example, the plans for Iraq go well beyond reconstruction. The intention is to create a dream economy, completely privatised and foreign-owned. Heralding privatisation as ”the right direction for twenty-first century Iraq”, the US initiated privatisation as soon as an interim administration, headed by an American, was in place. The war on Iraq was shadowed by a battle among American corporations to win reconstruction contracts.

But the opportunities are not open to all. Before the war, in early March, USAID secretly asked six US companies to submit bids for USD 900 million in government contracts to repair and reconstruct water systems, roads, bridges, schools, and hospitals. Coincidentally, the six companies –Bechtel Group Inc., Fluor Corp., Halliburton Co., Louis Berger Group Inc., Parsons Corp., and Washington Group International Inc. — are all close to the Bush administration.

In late March, the first contract was awarded, without competition or detailed explanations of total cost, to Vice President Dick Cheney’s old employer, the Kellogg Brown & Root (KBR) unit of Halliburton Co. Bechtel landed the largest USAID contract: an initial award of USD 34.6 million, with funding of up to USD 680 million over 18 months subject to congressional approval.

The most hotly contested contracts will be to rebuild Iraq’s oil industry. The empire has left the selling of Iraq’s oil resources –the world’s second-largest– to Iraqi National Congress leader Ahmad Chalabi and former Iraqi petroleum ministry officials. Last year, Chalabi, whose close ties with Richard Perle, Rumsfeld, and Cheney predate the current Bush administration, met with US oil executives. Afterward, Chalabi made it clear he would give preference to an American-led oil consortium, and suggested that previous deals with Russia and France totalling billions of dollars could be voided.

But remaking the global oil market is not necessarily the endgame: rebuilding Iraq the way corporations want to is. Transfer of public goods to private hands in Iraq is intended as an initial step in widespread privatisation in the region.

Mr. Bush linked war and trade in his commencement speech at the University of South Carolina on May 9, unveiling his plans to create a US-Middle East Free Trade Area (MEFTA). The region includes many of the most closed and protected economies in the world. Half of the 22 members of the Arab League, including Saudi Arabia, Syria, Lebanon, and Algeria, remain outside the World Trade Organisation (WTO). Furthermore, the region’s import tariffs are among the highest in the world, with strict restrictions on foreign investment.

Resistance to the unilateral US strategy does not go over well. In March 2003, President Bush alluded to the possibility of reprisals if Mexico didn’t vote America’s way in the UN Security Council on the question of Iraq. In July 2003, the administration cut off military aid to 35 friendly countries in retaliation for their support of the International Criminal Court (ICC). And following the collapse of trade talks in Cancun, the US is threatening ”to take note” of those countries that ”torpedoed” the negotiations in Cancun. And the empire makes no bones about its desire to attack and ”regime-change” Syria, Iran, Libya, North Korea, possibly Saudi Arabia, and even Cuba.

However, the US position as a solo superpower could be short- lived. Washington’s desire to dominate affairs around the world has created a global resistance against the ”Imperial Empire”. Iraqis continue to take to the streets to protest the US occupation. The Third World country delegates, along with the international civil society, rejected US hegemony in Cancun at the 5th WTO Ministerial. The combination of developing country resentments inflamed by US arrogance, a crippled economy, an expensive invasion and occupation of Iraq that has not gone well for the US, and reinvigorated civil society resistance to corporate driven globalisation, cannot but erode the unilateral policies of the US. (END/COPYRIGHT IPS)