It Was Always About The Oil, Stupid!

Sep 18, 2007 | Updated May 25, 2011

Finally, someone in a position of influence in Washington, someone who can't be accused of playing partisan politics, has spoken the truth about George W. Bush's invasion of Iraq: It was primarily about the oil.

Alan Greenspan, the former Federal Reserve chairman who attained rock-star status during his tenure in Washington, declares in his new memoir that "the Iraq War is largely about oil." Calling his admission a "politically inconvenient fact," the maestro, as his fans pronounced him during his star turn in our nation's capital, has struck a rather dissonant chord for the Bush administration, which has insisted -- and will vehemently continue to insist -- that oil had nothing to do with our disastrously divisive and tragic invasion of Iraq.

We all know the changing and changeable list of White House-proclaimed motives for our decision to start a war, ranging from Saddam Hussein's alleged store of weapons of mass destruction to America's duty to bring freedom and democracy to Iraq, to the need to deal a decisive blow to Islamic terrorists. We also know that we are now bogged down in a civil war with no apparent end. But a discussion of the rightness of this war is not my intent here. Rather, I'm going to take the opportunity to remind you, dear readers, of the evidence that points to the truth of what Greenspan is saying. The administration has already begun to hit back, with Defense Secretary Robert Gates challenging Greenspan's version during an appearance on ABC's This Week program, and we can expect that the self-serving pronouncements will flow freely. So it's important to recall the facts.

In my 2005 book, Over A Barrel: Breaking The Middle East Oil Cartel, and an updated version, Over A Barrel: Breaking Oil's Grip On Our Future (coming soon to a bookstore near you), I reported the details. To begin with, after toppling Saddam Hussein, the United States passed up a golden opportunity to break Iraq's ties with OPEC, thereby removing its vast reserves of crude oil from the cartel's malicious grip. Instead, the Bush administration hastened to reinstate the connection, claiming America had no business intervening in Iraq's dealings with OPEC.

Of course, we had no such qualms about intervening in every other aspect of Iraqi life, randomly arresting and imprisoning thousands of Iraqi men, dissolving the Iraqi army, ridding the country's institutions of the only people who knew how things worked, and virtually guaranteeing that an anti-U.S. insurgency would ensue under the amateurish ministrations of Paul Bremer, head of the Coalition Provisional Authority.

But when it came to oil, we pretended it was "hands off." In reality, however, we first enlisted oil professional Philip J. Carroll, formerly of Shell Oil, to "advise" the Iraqi Oil Ministry. Then, after Rob McKee, a former ConocoPhillips executive with ties to Halliburton, entered the picture, it was full steam ahead on building a strong national oil company that would be dependent on Big Oil consultants and destined to rejoin the OPEC band of extortionists. As Greg Palast wrote in Harper's magazine, any objections from the Iraqi Governing Council were summarily dismissed, while Vice President Dick Cheney openly advocated an OPEC-friendly policy for Iraq.

For the oil boys, it was just business as usual, the American consumer and the world economy be damned. And, as we've seen in the intervening years, as oil climbed from $28 a barrel in September of 2003 to over $80 a barrel in September of 2007. This increase in oil price alone is costing the American consumer an additional $400 billion a year. The consumer is only peripherally on the mind of an administration beholden to Big Oil and big oil prices -- even if it means war with all its cost of lives and treasure.