Sketching a Theory of Fossil Imperialism

By Bernardo Jurema and Elias Koenig

This is a summary of the paper ‘State Power and Capital in the Climate Crisis: A Theory of Fossil Imperialism,’ presented by the authors during the “Confronting Climate Coloniality” - Paper Session at the American Association of Geographers (AAG) annual meeting on March 26th, 2023. It is also an overview of some of the main ideas that we hope to further develop this year. While the research behind the conference paper was carried out at Research Institute for Sustainability - Helmholtz Centre Potsdam (RIFS), the opinions and viewpoints expressed herein are our own and do not represent the standpoints of RIFS as a whole. This piece was originally published on the RIFS Potsdam website.

In recent years, both activists and researchers have started to invoke the term fossil imperialism to highlight the ways in which imperialist politics are tied up with the logic of fossil capitalism. Under fossil capitalism, ceaseless accumulation of capital necessitates continued expansion of an energy base of coal, oil, and natural gas. Imperial states play a key role in the process, which has in turn enabled a remarkable concentration of imperial power and continues to do so in today’s world order. Understanding fossil imperialism, therefore, is necessary for devising effective strategies of resistance to a planet-wrecking capitalist status quo.

Our model of fossil imperialism attempts to sketch the general workings of this relationship between imperial states and fossil capital in its historical development over the past two centuries and in its different varieties. It is principally based on the two general modes of expansion and obstruction. On the one hand, the expansion and protection of new fossil fuel resources and infrastructure are crucial to keeping the engine rooms of fossil capital well-supplied. On the other hand, the obstruction or destruction of the infrastructure of rivaling capital factions and states in order to maintain control over pricing and distribution has been equally integral to the history of fossil imperialism. In this way, the workings of fossil imperialism reflect the more general nature of capitalism as a mode of production and destruction.

It is important to take into account the specific characteristics of the three dominant sources of fossil energy (coal, oil, gas) when analyzing concrete cases. While all three energy sources still hold a significant share of the global fossil economy, each also corresponds to a distinct historical phase in the development of fossil imperialism. Coal powered the rise of the British Empire, the switch to oil marked the ascent of American hegemony in the 20th century, and fossil gas is increasingly at the core of the United States’ attempt to continue projecting its supremacy well into the 21st century. While there is growing concern over new forms of "green imperialism", especially in relation to the extraction and distribution of the raw materials supposedly required to decarbonize the economies of the North, current fossil-fueled conflicts such as the Russian war in Ukraine or the Saudi war in Yemen show that the age of fossil imperialism is - unfortunately - far from over.

There are at least five ways in which imperial states facilitate the interests of fossil capital: through colonization, the projection of military power, the suppression of anti-extractivist movements, economic warfare, and the domination of global institutions. This scheme makes plain the crucial role of fossil fuels, functioning variously as a driver, as an enhancer or as an outcome of imperial states' actions. It disentangles the ways in which contemporary politics are significantly influenced by fossil fuels, which have played a defining role in shaping the structure of capitalist corporations, settler-imperial states, and earth-transforming technoscience. These arrangements have had profound consequences for ecological destruction and the implementation of ecological management strategies.

Colonization is a form of direct political domination and subjugation of one people by another. It was perhaps most evident during the “golden” age of coal, the fossil fuel that powered the rise of the British Empire — from Australia to India, from South Africa to Borneo. Because coal extraction requires a large amount of disciplined labor, arguably, it also necessitates more comprehensive forms of social and political control than oil and gas extraction. At the same time, the British — in many cases — obstructed the rapid expansion of foreign coal industries to protect their own domestic industry.  Even in the case of oil and gas, many of the major private companies like BP and Shell still operate in markets shaped by colonial legacies.

support our work by making a donation today!

“Projection of military power” refers to different kinds of military interventions short of full-on colonization. Historically, states often deployed their own forces to protect fossil infrastructure abroad — a practice that continues today in various ways. Projection of military power also takes place through proxy armies, funded through a closed circuit of oil money and weapons contracts, as in the case of the Gulf monarchies. The 20th anniversary of the invasion of Iraq reminds us how current the role of military power remains. Twenty years after the regime-change military intervention, the United States still has 2500 troops stationed in the country. And, as has recently been revealed, BP and Shell, which had been barred from the country for decades, have extracted tens of billions of dollars in Iraqi oil post-invasion.

The pursuit of regional economic dominance on the part of fossil imperial states requires the suppression of anti-extractivist movements and other grassroots movements opposed to the social order. Interventionary military assistance was justified from the 1990s onwards on the basis of immigration enforcement, anti-narcotics control, and fighting against general criminality. For example, the role of the War on Drugs in continuing counterinsurgent practices against civilian population that were carried out until the late 1980s within a Cold War framework. However, according to Russell Crandall, professor at Davidson College in North Carolina and former Pentagon and National Security Council official under George W. Bush, the significant role in shaping outcomes is not primarily played by the U.S. military advisors, but rather by the "imperial diplomats" – the civilian officials within the U.S. foreign policy structure.

In his study of economic sanctions, Cornell historian Nicholas Mulder has demonstrated that modern-day sanctions developed out of mechanisms for energy control, blacklisting, import and export rationing, property seizures and asset freezes, trade prohibitions, and preclusive purchasing, as well as financial blockade — simply put, economic warfare. He shows that effectively isolating a whole nation from the intricate networks that support global trade requires the ability to gather information and generate knowledge. This involves mapping the intricate web of physical goods and resources that connect the specific country to the rest of the globe. Key factors in this process include having legal authority and access to more precise data and statistics. What makes it possible to impose this unilateral sanctions regime on the rest of the world is the domination of the global (financial and political) institutions that regulate the trade and distribution of fossil fuels. Both 19th-century British and 20th-century US-American dominance stemmed from their respective global leadership in corporate, regulatory, technological, and financial frameworks, which in turn was tightly linked to the pound sterling and later the US dollar being the chief reserve and trade currencies of their time.

In the age of American hegemony, the United Nations and other multilateral organizations — in particular, the Bretton Woods system (the International Monetary Fund and World Bank) — have become key means to maintain its armed primacy and fossil-based economic dominance. Significantly, the US-led bloc thwarted attempts by the newly decolonized countries in the postwar period to build a fairer world order by torpedoing the Third World agenda, the United Nations Conference on Trade and Development, the Non-Aligned Movement and the New International Economic Order.

Conclusion

It is impossible to understand imperialism without understanding the role of fossil fuels in its historical emergence and development. A climate movement that does not actively take into account the mechanisms of fossil imperialism risks being co-opted into imperialist false solutions to the climate crisis. Likewise, anti-imperial movements that fail to break definitively with the logic of fossil capitalism historically fall victim to various social and ecological contradictions. A case in point are the Pink Tide governments of the first decade of the 21st century. As University of Toronto political scientist Donald Kingsbury put it, when "faced with a choice between extraction and the local movements that made their governments possible,” these regimes “sided with extraction." A better understanding of the topic can therefore contribute to more effective climate justice activism, more strategic clarity and tactical innovation, and serve as a basis for more international solidarity.

Gold and Oil: A Tale of Two Commodities

By Contention News

Enjoy this special edition of Contention News — a new dissident business news publication — with analysis exclusive to Hampton Institute. You can read more and subscribe here. 

Gold broke $1,930 an ounce this week, its highest level ever. This follows weeks of record inflows to gold-related exchange traded funds (ETFs), and comes alongside silver’s biggest weekly gain in four decades.

Oil also advanced last week, but prices remain depressed -- the fracking industry now faces “extinction.”

Solving the puzzle of how metals can be gaining while the production of the most crucial commodity of our times can “peak without ever making money in the aggregate” unlocks important insights into how our global system works at its core. 

Money and the world of commodities

To repeat: money exists to circulate commodities. [1] Anything can serve as money as long as there is a stable relationship between the value of money at large and the world of commodities it circulates. The best way to do this: pick a representative commodity to serve as money. [2] Metals have low carrying costs and are easily divisible, so most epochs have settled on gold or some other metal for this purpose.

Since 1973, however, the world money system has not relied upon a representative commodity. Instead it has relied upon the United States to use political and military means to keep commodity prices stable. [3] The easiest way to keep prices steady: pin them down. Prices and profits serve as the signal for action: higher commodity prices = higher input costs = squeezed margins. 

Politicians don’t have to worry about the monetary system, they just have to think about corporate earnings. 

Oil prices and economic crisis

This worked for most of the world’s commodities save one: petroleum. The oil crises of the 1970s prompted a multi-year inflation crisis and economic “stagflation.” The United States responded with the Carter Doctrine, which defined the free flow of oil in the Persian Gulf region as a matter of U.S. national interest, justifying persistent military presence in the region and strategic alliances with key oil-producing states to keep prices low.

This system broke down between 2003 and 2008, with oil prices spiking more than $120 a barrel over that period. What caused the spike? The most likely causes:

• unanticipated popular resistance to the U.S. intervention in Iraq 

• accelerating energy demand from China’s rapid economic development

• significant financial speculation [4]

This price rise reached crisis levels in 2008 immediately prior to the Great Recession. Correlation isn’t causation, but it isn’t out of line to think that rising fuel and other commodity costs might have prompted an uptick in mortgage defaults. The same goes for investors selling off previously iron-clad securities as prices in general grew unstable. 

Fracking provides a crucial response to this kind of crisis. Not profitable under normal conditions, rising prices draw investment into the sector, bringing on new supply, driving prices down again. Companies borrow big to get started and go bust quickly, but executives get their golden parachutes, creditors get their settlements, attorneys make killer fees, and large firms gobble up all the abandoned assets. Only oil workers, royalty owners, and taxpayers lose.

Gold’s moment today 

Now a new crisis from outside the energy sector has destroyed demand and plummeted prices. [5] Central bank “money printing” in response should be inflationary, and thus the rise in gold prices, according to conventional economic wisdom.

Except that conventional wisdom is actually backwards. The money supply does not determine prices, commodity production determines how much money you need. If production goes up or production costs get bid upwards, [6] you need more money. Money gets pulled out of savings, banks increase lending, and the supply and velocity of money goes up.

Simply pouring more money into a depressed market, on the other hand, drives that cash into savings. This oversupplies money markets, driving down interest rates. As real rates — interest minus expected inflation — dip into negative territory, gold’s zero yield becomes a better bet than anything else. That’s how you end up with low oil prices, a collapsing fracking industry, and rising gold values. 

But now U.S. political failure is putting the whole dollar system into question over and on top of this. The result: investment flowing out of the dollar and into the yuan and the Euro. Without a clear alternative to the dollar as “world money,” gold is even more attractive as an asset. If rising demand in countries outside the United States drives up oil costs, price instability could make it even better. 

The puzzle still has pieces that have yet to be placed, but the image is clear: a fragile system is coming to an end, and when it falls who has the gold will rule. 

For more anti-imperialist business analysis, subscribe to Contention. 

Notes

[1] Much of the analysis here is inspired by collective study of The Value of Money by Prabhat Patnaik

[2] Any advances in the productive forces at large will shift the marginal value of all commodities, the money commodity included. Industrialization, for example, allowed the same amount of labor-power to produce a larger quantity of commodities, lowering the marginal value of each. Industrialization did the same for gold production, shifting its relative value to the world of commodities in the same way.

[3] The recent right-wing coup in Bolivia represents an example of this strategy. The United States could not tolerate an independent government controlling a significant supply of lithium. Even if Tesla buys its lithium in Australia, the prospect of an anti-colonial government controlling enough supply to boost prices — especially in alliance with China — not only impacts the automotive industry, it actually poses a risk for the whole monetary system. 

[4] Another way of putting this: the falling rate of profit produced rampant financialization which collided with class struggle against imperialist occupation and Western hegemony to destabilize commodity exchange on a fundamental level. 

[5] The crisis is internal to capitalism, not exogenous, the result of rampant deforestation and imperialist supply chains. See Rob Wallace et al. “COVID-19 and the Circuits of Capital.”

[6] Bid upwards by class struggle — workers fighting for higher wages, peasants demanding fairer prices for their outputs, colonized countries taking charge of their resources, etc.

Connecting the Dots: Iran, China, and the Challenge to U.S. Hegemony

By Qiao Collective

Originally published at Qiao Collective's website.

The renewed threat of outright war with Iran in the first weeks of 2020 has remobilized the U.S. anti-war left. On January 3, the U.S. deployed a targeted drone to assassinate high-ranking Iranian general Qassem Soleimani in Baghdad, Iraq. One day after, thousands of protesters rallied in dozens of American cities following a call for a day of action from the ANSWER Coalition (Act Now to Stop War and End Racism). Meanwhile, Democrats offered tepid criticism despite just weeks prior voting to approve President Trump’s massive $738 billion military budget and rejecting an amendment introduced by Reps. Khanna (D-CA) and Sanders (D-VT) that would have cut off funding for executive military action in Iran or elsewhere without Congressional approval.

Amidst these leftist and liberal contestations and despite a retaliatory Iranian missile strike on a U.S. base in Iraq, President Trump called for diplomacy and claimed the U.S. “is ready to embrace peace with all who seek it.” The threat of further U.S. military action in Iran may be receding for the short-term. But the reality is that the U.S. was at war with Iran far before the strike on Soleimani—just not employing tactics of war recognized by many as such. Since the Trump administration announced its withdrawal from the 2015 Iran nuclear deal in May 2018 and reinstated sanctions on Iran that November, the U.S. has recommitted to a “hybrid war” designed to cripple Iran’s economy and cut off the nation from international trade. This concept of hybrid war—which deploys disinformation, economic sanctions and coercion, and political manipulation to further U.S. interests without the use of military intervention—is crucial for understanding U.S. aggression against Iran and its significance in the larger world system.

The aim of renewed U.S. sanctions on Iran is clear: as Secretary of State Mike Pompeo put it, they seek to “starve the regime,” “accelerate the rapid decline” of its international trade, and “restore democracy.” Not only do the unilateral sanctions blacklist 50 Iranian banks and hundreds of individuals, vessels, aircraft and Iran’s energy sector, they aim to bring Iran’s oil exports to zero by wielding the U.S.’s global economic dominance and threatening to penalize foreign corporations and states that continue to do business with Iran. As Pompeo warned: "If a company evades our sanctions regime and secretly continues" to do business with Iran, "the United States will levy severe, swift penalties on it, including potential sanctions." The impact of this U.S. abuse of power is nothing short of a humanitarian crisis: food prices quickly skyrocketed after the announcement of renewed sanctions, and testimonials from Iranian students, doctors, patients, and others have described severe limitations on access to education, medicine, and health care under U.S. sanctions. In a talk on security issues in Ufa, Russia, the head of Iran’s Supreme National Security Council Ali Shamkhani rightly described U.S. sanctions as a violation of national sovereignty and a form of “economic terrorism.”

So why escalate military action when sanctions imposed by the U.S. and enforced by international financial organizations have already ravaged Iran’s economy? One partial answer is Iran’s deepening ties to China, whose injection of capital and pledges of military support have been a lifeline to a politically-isolated Tehran. The U.S. has become increasingly threatened by a new global political alliance led by China, Iran, and Russia and including countries like Bolivia, Venezuela, and Cuba. Strengthened through years of meticulous economic, military, and political cooperation and forged under shared circumstances of victimization by antagonistic U.S. foreign policy, this power bloc threatens to challenge U.S. hegemony over the global order.

First and foremost, Chinese-Iranian economic agreements have undermined U.S. sanctions and integrated Iran into a Chinese-led Eurasian economic zone which the U.S. deems an imminent threat. In 2016, Iranian President Hassan Rohani announced during a visit from China’s President Xi Jinping that Iran and China had created a $600 billion dollar, 25-year political and trade alliance. During Xi’s visit, Iranian Supreme Leader Ayatollah Ali Khamenei stated, "Tehran seeks cooperation with more independent countries" because "Iranians never trusted the West." The landmark deal made explicit that China provides knowledge-sharing and will assist in building critical infrastructure such as hospitals, railways, and roads in Iran. In September of 2019, the two countries updated the 2016 agreement which would include a $400 billion investment focused in Iran’s oil, gas, and infrastructure sectors—renewed U.S. sanctions be damned. Meanwhile, since early 2019 Chinese and Iranian officials announced their joint cooperation in China’s Belt and Road Initiative, a massive trillion dollar trade and infrastructure project linking markets in East and Central Asia, the Middle East, and Europe. (Iraq also announced its intention to join BRI in 2019, to the dismay of U.S. strategists.) China has even gone as far as to turn off its oil ships’ radar and sonar technology when entering the Persian Gulf in order to avoid U.S. military detection and further punishment for “violating” U.S. sanctions. Amidst U.S. aggression against Iran and crippling sanctions that target medical supplies and kills countless Iranians, the political alliance and trade deal serves as a crucial lifeline for Iran and its people, providing the material basis for what Iranian Foreign Minister Mohammad Javad Zarif praised as China and Iran’s shared vision of sovereignty, peace, and mutual progress.

While China has proven an invaluable ally to Iran and its people, Iran—as an oil-rich nation located at the center of BRI’s trade route—also presents a strategic ally for China. Shut out of Western financial markets, Iran has turned to China as an economic partner. And unlike U.S. economic terrorism designed to undermine political autonomy in Iran, the $400 billion Chinese-Iranian deal simply gives Chinese state-owned firms the right of first refusal for Iranian petrochemical projects. (Ironically, the U.S. media insists that only one of these economic policies is predatory.) Given the U.S. government’s grave trepidations about BRI’s potential to decenter U.S. global economic hegemony, it would make sense that the U.S. seek ways to undermine Iranian-Chinese cooperation. U.S. leaders have already pressured allies in Europe and Asia to spurn Chinese investment and threatened to stop intelligence sharing with allies that accept Chinese Huawei 5G technology. Despite itself controlling world financial institutions like the IMF and World Bank whose structural adjustment loans have forcibly privatized and destabilized developing economies across the world, the U.S. has decried China’s “predatory approach to investment” and warned allies to choose sides.

But Iran’s ties to U.S. rivals such as China and Russia are not solely economic. Just days before the Solemaini assassination, Iran, China, and Russia held joint naval drills in the Gulf of Oman, a “normal military exchange” that reflected the nations’ “will and capabilities to jointly maintain world peace and maritime security,” Chinese defense spokesman Wu Qian said. Commander of the Iranian Navy Rear Admiral Hossein Khanzadi stated that the U.S. and some of its allied nations staged a failed military attempt to sabotage the joint naval exercise. And on January 6, Iraq’s Prime Minister welcomed Chinese ambassador Zhang Tao, who conveyed Beijing’s readiness to provide military assistance amidst U.S. refusals to cooperate with Iraqi parliament’s demands to withdraw.

Disappointingly, China’s consistent support for victims of U.S. economic terrorism has gone largely unnoticed by self-described Western leftists. The U.S. left in particular has failed to advance a systematic analysis that places U.S. aggression in Bolivia, Venezuela, Iran, and Iraq in relation, instead defaulting to a reactive, case-by-case resistance to various coups, air strikes, and aggressions as they occur. While U.S. anti-war advocates have quickly mobilized to respond to overt forms of imperial intervention—the use of military violence in Iran or its staging of the 2019 Bolivian coup, for instance—it has failed to connect the dots between these individual cases and the emergence of a global power bloc challenging U.S. hegemony, of which China plays a key and consistent role. Indeed, China has provided a recurring economic, political, and military lifeline to nations such as Venezuela (where China remains a major buyer of oil despite U.S. sanctions), Bolivia (where Evo Morales’ government spurned Western transnational companies to partner with Chinese state-owned firms to nationalize Bolivia’s lithium industry), and North Korea (where China provides crucially-needed food aid and has advocated for an easing of U.S. sanctions) as these nations have attempted to survive U.S. sanctions, expel Western capital, nationalize key industries, and chart an independent course from the U.S. world order.

The U.S. left’s inability to understand China as a proven ally for nations struggling under the boot of U.S. empire is a massive strategic failure. Instead, U.S. progressives invoke “both sides” false equivalencies that equate a real and hegemonic U.S. global power structure with the vague, potential specter of “Chinese imperialism.” Under such an argument, Chinese economic lifelines provided to Iran, Venezuela, and other nations cut out of global markets by U.S. sanctions are simply an opportunistic power play, one which would replace these nations’ subjugation under Western imperial power under a new, ostensibly equally brutal, Chinese power. The fact that such facile elisions have found a foothold amongst the U.S. left has proven to be a critical weakness in its ability to mount more than a purely reactive response to present U.S. aggression. Certainly, skeptics will argue that China benefits from its economic ties to vulnerable victims of U.S. aggression, but that ignores both the obvious facts that mutual benefit is the foundation of all international relations, and that China has been consistently targeted with U.S. secondary sanctions, propaganda, and fear mongering for its audacity to challenge U.S. policy in the Middle East, Latin America and beyond. The U.S. left’s failure to challenge—and indeed its tendency to repeat—antagonistic rhetoric against China is fundamentally contradictory to its stated solidarity with nations such as Iran, Bolivia, and Venezuela.

Notions that China is seeking to “unfairly” benefit from brutal U.S. sanctions on nations like Iran miss the fact that the U.S. is escalating its own kind of hybrid warfare against China to punish China for daring to “violate” U.S. sanctions. Indeed, the U.S. has repeatedly en-masse sanctioned Chinese companies and banks, both private and state-owned, for providing trade and aid to Iranian entities. Indeed, the so-called U.S.-China “trade war,” despite receiving little attention from the left, is part and parcel of U.S. attempts to undermine China’s ability to provide assistance to Iran and other targets of U.S. hybrid warfare. With its explicit goals of undermining Chinese state economic control, privatizing key industries, and forcing China to remove restrictions on foreign capital and company ownership, the trade war threatens to destabilize China’s role as an economic lifeline for Iran, Venezuela, and the rest of the Global South. The finance, oil, and mining industries—key targets for privatization under trade war negotiations—are crucial to China’s ability to purchase Iranian oil and assist Latin American countries in providing alternatives to Western capital investment from their mining and natural resources industries. Without full state control over its finance, oil, and mining industries, China may lose control of these industries to Western companies and could ultimately lose the ability to act swiftly and leverage those industries to defy U.S. sanctions on oil and mining industries of Global South nations like Venezuela, Bolivia, and Iran. As U.S. media celebrate China’s slowing economy and the material harm the trade war is causing Chinese people while salivating over the prospect of U.S. financial dominance over Chinese markets, it is becoming clear that a likely goal of the U.S. is to use the trade war not only to “open” China’s state-owned domestic industries to Western investment, but also to undermine its leadership of the only geopolitical bloc that poses a real challenge to U.S. global hegemony.

What’s more, the U.S. has used feigned concerns over human rights abuses as a trojan horse for its regime of sanctions against supposed “rogue states.” Seemingly progressive bills such as the Hong Kong Freedom and Democracy Act, which received near-unanimous bipartisan support in the U.S. House and Senate, include provisions that would mandate Hong Kong abide by U.S. sanctions against Iran and North Korea, while giving cover to further sanction Chinese individuals and firms and ban Chinese actors from entering the U.S. The sole opposition in the House came from Thomas Massie (R-KY), who stated his consistent opposition to sanctions which “[meddle] in the internal affairs of foreign countries” and “invites those governments to meddle in our affairs.” Supported widely by proclaimed progressive and leftist groups in the U.S., the legislation provides a textbook example of how the U.S. uses the language of democracy and human rights abroad as cover for retaliation against geopolitical rivals and to further its own human rights abuses through punishing sanctions.

It is important to note that this economic warfare has been coupled with the quiet escalation of the Obama era “pivot to Asia,” which sought to contain China’s rising influence through military and economic policy. The head of the Pentagon has called China his new “top priority,” and in January 2020, the U.S. Army announced two new regional task forces that would combat the “strategic threat” of China through a focus on “non-conventional warfare” to create an “asymmetrical advantage” for the U.S. in the event of military conflict. The Department of Defense had previously designated the Pacific as its “priority theater,” and conducts routine military drills in Japan and South Korea while selling $2 billion in arms to Taiwan in 2019 alone. This escalation of U.S. military power in Asia under the rationale of “containing China” makes clear that opposing U.S. antagonism towards China is paramount for future hopes of peace and demilitarization in Asia and the Pacific.

In order to mount a serious challenge to American empire, the U.S. anti-war movement must understand the terms of engagement: economic terrorism through sanctions and political isolation and destabilization have become the primary modes of U.S. imperialism. Often obscured by overt acts of military violence, U.S. hybrid warfare waged against not only Iran but Venezuela, Bolivia, North Korea, and China is the primary contradiction facing the global struggle against imperialism. For too long, U.S. critics of American empire have evaded the derisively termed “China question” in favor of false equivalences and the repetition of U.S. state talking points. But behind the Cold War rhetoric, China has proven itself as a strategic ally for countless nations with which U.S. leftists claim solidarity. Whether the U.S. anti-war movement will rise to oppose increasing aggression against China designed to undermine its ability to support Iran, Bolivia, North Korea, and all victims of U.S. imperialism remains to be seen.

Qiao is a collective of Chinese leftists living in the diaspora. They may be followed on Twitter @qiaocollective

US-Saudi Ties: Drenched in Blood, Oil, and Deceit

By Joyce Chediac

Why do Donald Trump and the CIA disagree about the recent killing of Washington Post columnist Jamal Khashoggi in the Saudi Arabian Embassy in Turkey?

The CIA concluded that Crown Prince Mohammed bin Salman, Saudi Arabia's de facto ruler, personally ordered the murder and dismemberment of Khashoggi. In an extraordinary statement for a U.S. president, Trump disputed the CIA findings. He said it didn't matter if MBS-as the Saudi ruler is known-was or was not involved in the Khashoggi killing, and that U.S.-Saudi relations are "spectacular."

Trump's statement reflects his narrow cultivation of business relations with MBS, while the CIA's announcement reflects the view that that MBS has become a liability for the U.S. ruling class as a whole. The spy agency, which has deep ties to Saudi intelligence, fears that bin Salman's reckless and impulsive actions could jeopardize the security of the whole Saudi ruling clique, endangering U.S. ruling class interests in Saudi Arabia and the entire Middle East.

For decades, Saudi Arabia has been one of the most strategic and valuable U.S. client states, and the CIA wants to keep it that way. Support for Saudi Arabia is completely bi-partisan. This partnership is drenched in blood, oil, and deceit.

A review of U.S.-Saudi ties shows that Saudi Arabia anchors the U.S. empire in the Middle East. The kingdom, with the greatest oil reserves in the world, is a source of fabulous wealth for U.S. oil companies. The Saudis use their oil capacity to raise and lower world prices to further U.S. foreign policy aims. In the 1980s, for example, Ronald Reagan, got the Saudis to flood the market with oil to reduce the world price as part of an economic war against the Soviet Union.

The kingdom willingly uses religion as a cover for imperialism's aims, exporting thousands of schools, mosques, and other centers that preach intolerance and recruit jihadists for U.S. wars. It allows the U.S. to invade other Arab countries from its territory and has funded covert CIA actions on three continents. It is treated like a cash cow for U.S. corporations and banks. It uses its vast stash of petrodollars to buy billions of dollars in Pentagon weapons at inflated prices, as well as other high-price U.S. products and services.

The country is ruled as the personal fiefdom of one family, the al-Sauds. The government is one of the most repressive and misogynistic in the world. There is no parliament or legislature. The first elections, and then only on a municipal level, took place in 2005, 73 years after the country was formed. Women were only allowed to vote in 2015. These incontestable facts go unmentioned by U.S. officials, Democrats and Republican alike.

While Washington claims to be a protector of human rights abroad, the Pentagon has pledged to send in troops if a mass movement tries to overthrow the Saudi regime.

A country birthed by imperialism

Britain and France emerged victorious after World War I. They carved Western Asia into more than 20 countries, drawing borders to weaken and dismember Arab and other indigenous national groups, and to facilitate imperialist domination.

That's when Saudi Arabia was created. Its rulers, the al Saud and the Wahhabi families and followers merged into a political-religious alliance. The Saudi Arabia we know was established 1932, when the Saudis agreed to stop harassing other British protectorates, and to accept Britain's definition of their borders.

Saudi Arabia's rulers were among the first far-right Islamists assisted by imperialism. They set up an absolute monarchy and theocracy. The only constitution was the Koran as interpreted by the royal family. Slavery was legal until 1962.

Wahhabism, a form of Islam aggressively intolerant of other currents of that faith, and in opposition to secular governments, became the state religion. Saudi Arabia's control of the most important sites in Islam-Mecca and Medina- gave it prestige it had not earned in the Muslim world.

Enter U.S. oil companies and the Pentagon

In 1933, the kingdom granted Standard Oil of California (now Chevron) exclusive oil drilling rights. Huge oil reserves were discovered in 1938, promoting the formation of ARAMCO (Arabian American Oil Company) by Standard Oil and 3 other U.S. partners that later became Texaco, Exxon, and Mobil.

Saudi Arabia would soon be the country with the world's largest known oil reserves. It would be the greatest oil producer in the world. And U.S. companies were pumping it.

Diplomatic recognition soon followed. In 1943, President Roosevelt declared the security of Saudi Arabia a "vital interest" of the United States. The U.S. opened an embassy in the country the next year.

The Pentagon soon arrived to secure the oil. In 1950, the U.S. established the Sixth Naval Fleet as a permanent military presence in the Mediterranean. In 1951, after signing the Mutual Defense Agreement, the U.S. began arming the Saudi government and training its military.

Since World War II, the U.S. empire has been built on controlling the oil flowing from the Persian Gulf. Saudi Arabia was the linchpin of this control.

Waging holy war for Washington: 'Our faith and your iron'

Following World War II, a wave of militancy and nationalism swept the Arab world. Mass secular movements in Algeria and Iraq overthrew colonial puppets. South Yemen declared itself socialist. The Egyptian and Syrian people deposed imperialist client rule. Many of the new progressive regimes and liberation struggles were aided by the Soviet Union

The thinking of U.S. policymakers was, as Rachel Bronson puts it, "that religion could be a tool to staunch the expansion of godless communism."

Saudi rulers happily complied. The founder of modern Saudi Arabia told U.S. Minister to Saudi Arabia, Colonel William A. Eddy, "Our faith and your iron."

Arab anti-imperialism was especially inflamed by the 1948 destruction of Palestine and the creation of Israel. To undercut this, the Eisenhower administration set out to increase the renown of King Saud, making him 'the senior partner of the Arab team."

A State Department memo documents expectations that the Saudis would redirect Arab anger from Israel to the Soviet Union:

"The President said he thought we should do everything possible to stress the "holy war" aspect. [Secretary of State] Dulles commented that if the Arabs have a "holy war" they would want it to be against Israel. The President recalled, however, that Saud, after his visit here, had called on all Arabs to oppose Communism."

In the 1950s and 1960s, the Saudis gave shelter to extremists seeking to topple nationalist governments. The kingdom started funding a network of schools and mosques that recruited jihadists for the CIA in Soviet republics with Muslim populations, and in poor Muslim countries in Asia and Africa. This included " facilitating contacts between the CIA and religious pilgrims visiting Mecca ."

The oil weapon

Some members of the Organization of Arab Petroleum Exporting Countries (OPEC) have advocated using oil as a weapon to force Israel to give up Palestinian land. Saudi Arabia, the biggest oil producer of OPEC, has staunchly opposed this. While calling for "separating oil from politics," the kingdom has repeatedly raised and lowered world oil prices to advance U.S. foreign policy.

There have been exceptions. To maintain credibility among the Arab world, Saudi Arabia joined the OPEC oil embargos against the U.S. and other governments supporting Israel in the Arab-Israeli wars of 1967 and 1973. The 1967 embargo lacked OPEC consensus and was not effective. Saudi Arabia agreed to join the 1973 embargo only after the U.S. promised $2.2 billion in emergency military aid to Israel, giving it an advantage in the fighting.

The 1973 oil embargo did not cause international shortages, as many oil producers didn't honor it. However, U.S. companies used the embargo to hold back oil supplies, raise prices, and increase profits. Occidental Petroleum's 1973 earnings were 665 percent higher than those the year before. By the end of 1974, Exxon Corporation moved to the top of the Fortune 500 list. Four other oil companies-Texaco, Mobil, Standard Oil of California and Gulf-joined Exxon in the top seven rankings .

In 1970, the Saudis organized the "Safari Club," a coalition of governments that conducted covert operations in Africa after the U.S. Congress restrained CIA actions. It sent arms to Somalia and helped coordinate attacks on Ethiopia, which was then aligned with the Soviet Union. It funded UNITA, a proxy of the South African apartheid government fighting in Angola.

More recently, the Saudi government likely drove down oil prices in 2014 in order to weaken the Russian and Iranian economies as punishment for supporting the Syrian government.

However, the U.S. ruling class has had it both ways with Saudi Arabia several times. While the country is a key client state of the U.S., the Saudis have also served as convenience scapegoats. When energy costs spike, causing considerable hardship among U.S. working-class families, for instance, the U.S. rulers hypocritically and suddenly start talking about the Saudi royal family, its thousands of princes, their gold bathtubs, and other extremes paid for by petrodollars.

Manufacturing a Sunni-Shia rift

In 1979, a mass revolutionary upsurge in Iran overthrew the Shah, a hated U.S.-backed dictator, establishing the Islamic Republic of Iran. The new government nationalized Iran's huge oil reserves. That same year, an armed band of Sunni fundamentalists denounced the Saudi royal family and seized the Grand Mosque in Mecca, taking tens of thousands of religious pilgrims hostage. Hundreds of hostages were killed in the retaking of the mosque. Both events shook the Saudi rulers to their core. They responded by diverting attention to Iran. They began a religious campaign against Shia Iran, claiming they were enemies of Sunni Islam. They upped funding for Sunni jihadists worldwide, encouraging them to hate other strains of Islam, other religions, and secularism.

There was no significant conflict between Sunnis and Shias in the modern era. Saudi rulers fomented it in an attempt to turn Sunnis against the Iranian revolution. Since then, all national liberation struggles or groups fighting for some degree of independence that have Shia members have been falsely labeled as agents of Iran. These include Hezbollah-viewed by Arab progressives as the central force in the national liberation movement of Lebanon-the amalgam of forces fighting Saudi domination in Yemen, and oppressed Shia minorities in Bahrain and Saudi Arabia.

The Saudis bought out the ARAMCO oil company in 1980. But this did not make Saudi Arabia independent. The oil was still controlled by U.S. companies, especially ExxonMobil, through their ownership of oil pumping and other technology, oil tanker fleets, storage facilities, etc.

Funding the Mujahideen and the Contras

In 1978, the Marxist People's Democratic Party of Afghanistan took control of the country in a coup. It promoted land distribution and built hospitals, road, and schools in one of the most underdeveloped countries in the world. It did this with the help of the Soviet Union. The new government banned forced marriages and gave women the right to right to vote. Revolutionary Council member Anahita Ratebzad gave the new government's view in a New Kabul Times editorial (May 28, 1978).

"Privileges which women, by right, must have are equal education, job security, health services, and free time to rear a healthy generation for building the future of the country … Educating and enlightening women is now the subject of close government attention."

Seeking to overthrow the Soviet-aligned government, the U.S. covertly supported rural tribes that were opposed to the recent social changes, especially women's rights and secularism. The groups attacked the new rural schools and killed women teachers. In 1979, the Soviet Union sent in troops to support the government.

From 1979-89 the Saudi kingdom recruited reactionary mujahideen forces and financed them to the tune of $3 billion. The CIA formally matched the Saudi funding.

In 1984, when the Reagan administration sought help with its secret plan to fund Contra militias and death squads in Nicaragua , the Saudi Ambassador to the U.S. pledged $1 million a month. Saudi Arabia spent a total of $32 million supporting the Contras. The contributions continued even after Congress cut off funding to the them.

U.S. would stop an internal revolution

In 1981, Ronald Reagan's Defense Secretary Caspar W. Weinberger said that the U.S. would not let the Saudi government be overthrown, and that it would send troops to defend the Saudi regime if necessary: "We would not stand by, in the event of Saudi requests, as we did before with Iran, and allow a government that had been totally unfriendly to the United States and to the Free World to take over." The U.S. would intervene "if there should be anything that resembled an internal revolution in Saudi Arabia, and we think that's very remote."

This is a regime that allows no human rights or freedom of speech; where virtually all the work was done by migrants who are super-exploited and have no chance of becoming citizens; where all women are considered legal minors and require an appointed male 'guardian' to supervise them and give permission for getting married, obtaining a passport, traveling, enrolling in a school; where in some court cases, a women's testimony is worth half as much as man's.

Saudi Arabia, 9/11, and extremism

Decades of funding extremist centers to recruit shock troops for CIA wars helped create radical Islamist groupings and individuals. Al-Qaeda's founder, Osama Bin Laden, is a prime example. He was a Saudi citizen and a key recruiter of Saudi fighters to Afghanistan.

Fifteen out of the 19 hijackers on Sept. 1, 2001 were Saudi nationals. One might think that if the Pentagon were to retaliate against any country for the 9/11attack, it would be Saudi Arabia. Not so. While it took a few months to sort things out, the upshot was tighter security ties between Washington and Riyadh.

Instead, Washington sent troops to Afghanistan ostensibly to force the Taliban government to turn over Bin Laden, who was seeking shelter there (even though the Taliban offered to surrender Bin Laden). Ironically, another reason cited was to protect Afghani women from the Taliban that Washington installed. Many believe, however, that a more pressing reason for Wall Street and the Pentagon was that the Taliban government would not permit the U.S. to build gas and oil pipelines through Afghanistan to bring oil from Central Asia to the Arabian Sea.

In 2010,Wikileaks published secret Saudi diplomatic cables revealing that the Saudis had the dubious distinction of being the "most significant" source of funding for Sunni terrorist groups (like al Qaeda) worldwide.

Other published cables confirm how the the Saudis cynically use religious shrines in their control. Jihadists soliciting funds slip into the country disguised as holy pilgrims. They then set up front companies to launder and receive money from government-sanctioned charities.

In 2013, under operation Timber Sycamore, Saudi Arabia and the U.S. partnered to fund, arm, and train jihadists in Syria.

The wars on Iraq

As the Soviet Union neared collapse, the Pentagon took aim at governments in the Middle East that weren't fully under its thumb. Iraq was the first target. When Kuwait waged economic war against Iraq, including the use of slant drilling technology to penetrate the border and steal Iraqi oil, the Iraqi government sent troops into Kuwait. This was the pretext for the U.S. to form an imperialist coalition to invade Iraq. The Saudis officially requested the U.S to send in troops. The Pentagon stationed 500,000 soldiers in the kingdom, and used Saudi soil as a base to invade Iraq, and later to enforce sanctions and a no-fly zone.

The Sept. 11 attack served as a pretext to invade Iraq in 2003. The corporate media whipped up a hysteria that Saddam Hussein bore responsibility for the 9/11 attacks, even though the Iraqi government and al-Qaeda were on opposite ends of the Middle East political spectrum, had no relations, and did not cooperate. U.S. and British leaders fabricated "evidence" that Iraq had developed nuclear weapons and posed an imminent threat to the world.

Once again, Saudi Arabia proved essential. U.S. coordinated attacks on Iraq out of the Prince Sultan Air Base near Riyadh, where some 10,000 troops were stationed. U.S. Special Operations Forces operated out of the country, which tapped into oil reserves to stabilize oil prices.

Subsidizing the U.S. arms industry

For decades, the Saudis have bought large amounts of U.S. weaponry at inflated prices. These purchases peaked under the Obama administration when Saudi Arabia agreed to spend over $110 billion on U.S. weapons, aircraft, helicopters, and air-defense missiles. This made it the largest purchase of U.S. arms in history. These weapons are not for defense. The purchases are far more than is needed for any purpose for a country with 22 million people. In effect, the Saudis are subsidizing the U.S. arms industry. Most of the military equipment sits in the desert.

Of course, the arms are used when needed. When the people of neighboring Bahrain rose up against a backward and repressive regime and Saudi ally in 2011, the Saudi military rode across sovereign borders on U.S. tanks and crushed the uprising. There was no outcry from Washington.

Waging genocide in Yemen

Additionally, in 2015 Saudi Arabia started a war to dominate Yemen. The war is currently at a stalemate, with the Saudi bombings and blockade responsible for a cholera epidemic, indiscriminate civilian deaths, and starvation, in what the United Nations calls the world's worst humanitarian crisis. Tens of thousands of children have died from disease and starvation. The war is waged with U.S. arms. U.S. advisers provide intelligence and training on the ground. Until this month, U.S. planes were refueling the Saudi planes bombing Yemen.

The U.S. has also been conducting its own operations within Yemen as part of the so-called "war on terror." These operations include drone warfare, raids, and assassinations.

The Saudi rulers clam that the conflict in Yemen in a Sunni-Shia one. But Saudi Arabia didn't think twice in the 1960s about backing Shiite royalist rebels in Yemen-the grandparents of today's Houthis-against Sunni troops from Egypt supporting a progressive Yemini government.

A cash cow for U.S. corporations

Saudi Arabia continues to be a cash cow milked by U.S. businesses. The kingdom bought $20 billion in U.S. products last year, from Boeing planes to Ford cars. It recently signed a $15 billion deal with General Electric for goods and services, and put $20 billion into an investment fund run by the Blackstone Group.

U.S. banks love Saudi Arabia. The kingdom has paid $1.1 billion to western banks in fees since 2010. And truly giant bank fees are in the offing for JPMorgan Chase and Morgan Stanley, who are working with ARAMCO to take that company public.

U.S. universities and corporations grease the wheels for these giant business deals by training the kingdom's managers and politicians, and promoting mutual interests. Many Saudi rulers begin their careers working for U.S. banks and businesses. Fahad al-Mubarak, who governed the central bank from 2011-2016 was previously chairman of Morgan Stanley in Saudi Arabia. Saudi Ministers, include those of finance and petroleum, got their degrees in the U.S.

The kingmakers in this oil-rich country have always been the princes of Wall Street. And the only god worshiped by the U.S.-Saudi unholy alliance is the almighty dollar.

This was originally published at Liberation School .