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Iran’s got us over a barrel – a few uneducated musings

18 April 2006

As it is, they can yank our chains anytime they want, almost without impunity. If we slap worldwide sanctions on them, then they’ve got nothing to lose, so they pull their oil off the market, and we end up in a bidding war with China, India, Europe and Japan for the rest of the oil on the market, followed hard by political upheaval here when Sadie Q. Public has to cancel her trip to Los Cabos and the truckers across the country revolt (see also, “France.”) Maybe we win that bidding war, but at what price? $100/barrel? What Bin Laden was unable to do on 9/11, Iran can do almost at will, at least as far as major, irreversible body shots to our economy. And they don’t have to fire a bullet to do it; it’s all economic policy stuff. It stands to reason, though, that when Iran pulls its oil off the market, the cost of our war in Iraq goes up immediately, which means more domestic pressure to pull out, not less. That nutcase in Tehran is crazy…like a fox.

Krauthammer said it right (although he had the wrong solution): “we are criminally unserious about energy policy.” OPEC has us by the short hairs, and all it takes is one serious player to bring us to our knees. Saudi Arabia may be trying to help us right now, but their fields are in decline, and their claimed reserves may not be real. Canada’s tar sands have everybody licking their chops, but how much oil does one have to burn to extract a barrel’s worth of oil from those super-gummy reservoirs? Ethanol’s all well and good, but how many acres of cattle feed (corn and sorghum) have to be redirected to grow corn for ethanol, and how are our beef-eating citizens going to like it when their double-meat McSlams end up doubling in price because feed costs have doubled…or when we start buying more Argentine beef to compensate for the higher livestock production costs here at home? It’s a monstrously complicated picture, but I can’t think of any scenarios under which to be terribly optimistic.

So I dunno, but I wouldn’t get too wrapped around the axle about an Exxon exec’s $400 million parachute. That retirement plan doesn’t even cause a blip on the economic implications of Iran’s upcoming decisions.

Who knows? We might be forced to view an Iranian move to take its oil off the market as an act of war. Lampooning the Iraq conflict as a “war for oil” misses the point: From here on out, every war is a war for oil, until we can figure out how to reduce our dependence on it. We dare not waste our strategic reserve just to keep Sadie comfortably in First Class on her way to Cabo.

In the meantime, some trust in horses, and some trust in chariots. How do I raise my boys in such a way that they will trust in God instead? America’s had a great run for 200 years, but the party hostess is starting to bus the tables.

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