THE ROAD TO QUAGMIRE

Aeswiren, who we depend on to keep an eye on these kind of things sent this acute analysis of how the Reagan Administration taught the Saudis the art of advanced corporate fraud. (The kind that involved oil, rather wives, camels, or goats.) And, of course, at precisely the same time, the CIA was pouring billions of dollars into the Mujahedeen in Afghanistan to support their guerrilla war against the Soviets. And, needless to say, one of the Mujahedeen’s most prominent organizers and financiers was a wealthy young Saudi named Osama Bin Laden.

“Oil is so important to the strength of a nation’s economy that it was the United States’ final plan of attack to crush the Soviets. During the late summer of 1985, the Reagan administration had a sudden stroke of genius. Tired of the stalemate, the American government knew that the only alternative to physical destruction of the Soviet Union was to nuke their economy. And knowing that much of its economy was based on two exports— oil to Europe and military weapons and training to anti-Western countries—we found an in. Mindful of the saying “the enemy of my enemy is my friend,” we decided to make a little pact with Saudi Arabia—an offer the Saudis couldn’t refuse. You see, high oil prices from OPEC kept Soviet exports to Europe and other countries profitable. It also allowed Iraq, Iran and Syria to purchase advanced Soviet weapons and training. And those countries had been threatening Saudi Arabia for years. The high oil price also allowed the Soviet Union to keep a military presence in South Yemen, Syria, Ethiopia and Afghanistan. The idea was to bankrupt the Soviet Union by having Saudi Arabia drop its oil prices far below what the Soviets could afford to sell for. Once non-Soviet prices were lowered, former Soviet oil clients would cease buying from the USSR, killing the communist giant’s income. It would also harm the Soviet economy because Iraq, Iran and Syria would no longer be able to sell their oil at prices high enough to be able to afford Soviet weapons and training. It was a sucker punch to end the Cold War, a numbers-crunching accountant’s wet dream . . . and it was just crazy enough to work. But that’s also where the problems begin. In short, we taught the Saudis how to cook the books and how to make their supplies appear larger than they really were to keep the oil prices low. In December 1985, the price of oil was $26.46. And then, suddenly, on March 31, 1986, it plummeted to $10.25. The Soviets couldn’t keep up, and their economy began to collapse. Our part of the bargain for Saudi Arabia’s aid in bankrupting the Soviets would become known as Operation Desert Storm. But the book-cooking lessons learned by the Saudis would soon become widespread among OPEC nations— and even among Big Oil companies. And after decades of inflating their actual reserve numbers without finding any more significant oil resources, the future of the world’s oil is falling apart faster than a canvas shoe on a rainy day.” From Report -- Energy and Capital.

The secret word is Hydrocarbon

And, for the rock & roll section of our show, what better than David Bowie live and “Putting Out Fire With Gasoline.”