What’s really at stake in Iraq?
Question by …. . .-.. .-.. —: What’s really at stake in Iraq?
I know most people hate long winded questions, but all the points of this question will take some time to present. I will try to be as brief as possible.
For the purpose of this debate, I want to make the assumption that every President of the USA since FDR has based their decisions on the welfare of the country and nothing else. I want to dismiss any notions that personal agendas were involved or personal gains were involved. Let’s just assume every President including GWB has acted solely for the good of the country as best as they could. That said, let’s review a bit of history;
The USA didn’t start issuing paper money until sometime around the Civil War. The script was actually a promissory note backed up by gold. All gold in the USA became the property of the government, and citizens were required to surrender their gold in return for script. A rate was fixed at $ 35 per ounce of gold. On the international market, the USA agreed to surrender gold in exchange for its script. This make U.S. currency as good as gold in international dealings and able to compete with the British pound sterling, which was the accepted international currency up to WWII.
The USA emerged from WWII as the wealthiest nation in the capitalized world. America didn’t fight the war for free. It supplied arms and equipment to its allies with an invoice enclosed and captured most of the wealth from these countries. Great Britain, for instance, didn’t finish paying off its war debt to the USA until just a few years ago. With no damage to its infrastructure, a booming industrial economy, and a full treasury the USA was clearly the economic leader of the world. Its currency immediately replaced the British pound as the international trade currency and has remained so to this day.
WWII created a new threat to the world, takeover by the communist state. For the first time in its history, the USA was not able to disband its military after the conflict. Since its treasury coffers were full, it presented little problems at the time for the country to maintain a guns and butter economy through the 1950s. The 1960s, however, strained the treasury beyond its means.
The 1960s brought on a period when the USA was maintaining a large military to keep the USSR at bay, it was financing a war in Vietnam, a space program, and began a welfare program for the poor. It was during this period that the government starting printing money in excess of its gold supply. This became quite evident to the international community, and in the early 1970s France came forward and demanded gold in exchange for its U.S. currency held in its reserve. This move by France started a run on the U.S. gold supply.
This was the major challenge that faced President Nixon during his term. His solution was to take the dollar off the gold standard and make a pact, which in time has proven to be a deal with the devil.
Note: from this point on, I am going to be a bit vague with actual names. Each time I put actual names in print here on this forum, the question ends up deleted for no given reason. When I use the word commodity, I am referring to the commodity you need to make your car go. When I mention pirates, I am referring to the group of foreigners who control the international supply of this commodity.
Nixon knew quite well that something had to determine the value of the dollars. His solution was really quite ingenious and a tribute to his wisdom. For the conditions of the world at that time, it was the perfect solution. Nixon made a pact which a group of pirates whereby they would sell their commodity on the international market and demand payment for this commodity only in U.S. currency. This was the establishment of what is called petrodollars today. The commodity became the standard by which the U.S. dollar was valued.
This solution did not come without an immediate effect. Without gold backing the dollar, the pirates thought their commodity was seriously underpriced. In 1974, the pirates enacted a commodity embargo, which lasted until their benchmark price was obtained. What followed was over a decade of inflation in the USA, which lasted until the money supply, the excess money printed in the 1960s, matched the economy.
Since the commodity based value of the dollar set an artificial value of its currency, the USA was able to print far more currency than its GNP demanded. This served the pirates well, as they too feared a Soviet takeover thus losing control of their commodity. But, this agreement of mutual necessity ended with the fall of the USSR. No longer do the pirates need the military protection of the USA. Only the USA needs the pirates the support its overextended currency.
Here lays the danger today. I don’t recall the exact figures, but as of 2003 there was somewhere around 2700 trillion dollars tucked away in foreign reserves. This is currency used in the international commodity market. About 5 or 6 years ago, one of the pirates, who held a grudge against the USA, starting demanding payments for his country’s commodity for food program in Euros rather than dollars. This move by this pirate started other pirates to consider the same. Even the largest pirate, who lived next door to this pirate, started making motions that it too would start trading in Euros.
The USA could not lose control of the international market that set the value of its currency. The only solution was to remove the pirate who started the whole movement. The opportunity presented itself when an unrelated group blew up the WTC. Plans were made, and the U.S. military went to work.
The plan, however, to secure the international commodity market with military force hasn’t quite worked out. Another neighboring pirate, much larger than the first pirate, is now trading its commodity in Euros instead of dollars. That pirate is now trying to foil the efforts of the USA, and that pirate now seems to be in the military cross hairs as well.
So, what’s at stake?
If the pirates start trading in Euros as opposed to dollars, the 2700 trillion dollars plus in foreign reserves becomes worthless except for here in the USA. This puts the industrial based in the USA in jeopardy. One possible way for foreign countries to recoup the value of this currency is to buy corporate America. We could see large companies like GE and Microsoft bought up with currency that would otherwise be worthless. Such a move would virtually place all of America in slavery.
We cannot change history. Every decision make in the past made by every U.S. President suited the times. We can only take a good look at where we are today and judge the correct action to suit the current conditions.
Which brings us to the question. Is success in the war in Iraq the answer to the problem?
Best answer:
Answer by Chi Guy
May I have this in hard copy? Who is your editor? Will this question be available at Barnes and Nobles?
What do you think? Answer below!
