Iraq - War and imperialist occupation

Image - US war aims

With the invasion of Iraq the US has announced its determination to launch pre-emptive wars anywhere in the world where it feels it has important interests and to change the governments of states which oppose its dictates. What is, in fact, announced is that the constraints under which US imperialism has operated up to now no longer apply. In the 21st century, which the US has baptised as the “American Century” the Monroe doctrine and the Roosevelt corollary will be applied, not only to the American continents, but also to the Middle East. The extension of this doctrine to cover other areas of the world, such as South East Asia where a war against North Korea is being prepared, is only a matter of time. In these areas of the world the rules of central and South America will apply and countries which oppose US interests will be treated like Grenada or Panama.

The events unfolding in Iraq demonstrate the nature of the new period of imperialism we have entered. This period has arisen from the collapse of Russian imperialism in 1991, and the consequent collapse of the only force able to maintain a pretence of constraining US appetites. With the emergence of the US as the sole superpower, US imperialism has shown itself prepared to resort to force whenever economic pressure and threats fail to compel states to do its bidding. Since the collapse of the Russian bloc we have seen the US going to war in the Gulf, in Bosnia and Kosovo, in Afghanistan and now in Iraq. All these wars have been, in the famous words of Karl von Clausewitz,

mere continuation of policy by other means. (1)

In the case of the present war in Iraq, the policy which is being continued is securing oil supplies and control of the major oil-producing region of the world. At the more fundamental level, US imperialism is asserting its right to appropriate the profits produced by workers form the four corners of the world. Through its control of oil and the currency in which it is traded US imperialism spreads a vast net which drains a proportion of the surplus value extracted from workers worldwide into the pockets of the US capitalist class. For US capital any threat to this arrangement justifies war.

New imperialist rules and new imperialist rivals

By asserting its interests in such a dramatic way the US has done more to form a the new imperialist order which has been emerging since 1991. In the countdown to this war tendencies in the international order which were latent and hidden have become patently obvious. US rivals, who had been former allies and had been content to hide behind US coat-tails in the Cold War period, began cautiously to assert their own interests in the ’90’s while never daring to put their heads above the parapet and oppose US interests directly. However, in the present march to war, where they perceive their interests to be directly challenged by the US, the Europeans, especially France and Germany, together with Russia have directly opposed US plans through manoeuvres at the UN. As we pointed out in RP 27 these countries all have their own imperialist motives compelling them to defend their interests in the Middle East, and have already positioned themselves to get their hands or Iraqi oil deposits. This is why these countries favour a peaceful disarmament of Iraq, which leaves their oil concessions intact, and oppose a US invasion which could cost them the contracts they have signed. It is ironic that George W. Bush has managed to forge the “common European home” alliance which Gorbachev singularly failed to put together in the 1980’s. There are no good guys in this imperialist saga. As we wrote in RP27,

The arrogant preachers of morality and international law are, in fact, a gang of thieves quarrelling over how to divide the wealth of a victim they have cornered. (2)

NATO, UN and international law

These conflicts of interests between the US and its former allies are inevitably producing ruptures in the existing international organisations of imperialism such as NATO and the UN. The dramatic refusal by France, Germany and Belgium to authorise the transfer of military equipment to Turkey, when the US requested it, reveals that the Atlantic Alliance is doomed. Similarly the farce being played out at the UN Security Council, and the US arrogant dismissal of its relevance, shows that this institution is shortly to return to the status it held during the cold war, that of a humanitarian agency. As we pointed out in RP 27, a Marxist understanding of global imperialism demonstrates that international bodies, such as the UN, are not independent of those countries who hold the real economic and military power. Such organisations will necessarily express the interests of the dominant imperialist power, or they will become irrelevant. The UN which is supposed to decide international questions of war is completely impotent in conditions where rival imperialist powers have the power of veto. In its 56 years of existence the UN has only authorised two wars, the Korean War and the Gulf War, while it has been powerless to stop the 150 or so other wars that have been waged in this period. In the case of the Korean War, the Russians made the mistake of boycotting the council, a mistake they did not repeat, and in the case of the Gulf War the Russian bloc had collapsed and, in the face of seemingly blatant aggression against Kuwait there was no case to defend against US wishes. Today, it is indicative of the growing imperialist rivalry between the US and Europe that France is prepared to veto the proposals of Bush and corporal Blair.

The brushing aside of the UN by Bush and Blair has caused much bleating about international law coming, not surprisingly, from the opponents of the US. While the capitalist class can agree on civil law, which is an expression of the class relationships in capitalist society and protects capitalist property, they find it hard to agree on international law. This is because international law expresses the relationships between sections of the capitalist class themselves and their nation states and is supposed to regulate imperialism. Such relationships are inevitably based on the power relationships between states, i.e. the powerful states make the laws and the weaker states obey them. The US reaction to the 1986 World Court judgement against it over Nicaragua, when it was found guilty of terrorism and ordered to pay indemnity to the Nicaraguan government, illustrates this point. George Schultz, who was then the US secretary of state, brushed aside the judgement as

utopian, legalistic ...and... ignoring the power elements of the equation. (3)

He was correct. International law only exists so far as the strongest states are prepared to enforce it and for the strongest states it is voluntary. The US can, therefore, ignore international law when it suits it to do so and force weaker states to obey the same laws. While the US has no hesitation in launching wars against Kosovo, Afghanistan and now Iraq in flagrant violation of international law, we are forever being told of the unacceptable violations of international law by Iraq, Iran, North Korea or whoever else is in the firing line.

It is instructive that the powers who are now shedding tears about the violation of international law, like France and Germany, did not raise this issue over Kosovo or Afghanistan. Only when their interests are being more directly threatened do we hear cries about international law. International law is nothing but a smokescreen behind which they intend to frustrate the interests of US imperialism and advance their own. Hence, they will only support a war authorised by the UN which, since they have the right of veto, will never happen.

The great powers do, however, want to retain a semblance of legality for their actions and we can confidently predict that after the US has achieved its interests by force, international law will mysteriously be found to justify what has happened. Weapons of mass destruction will be found one way or another and France and Germany will have no alternative but to accept what has occurred. A formula will be found to bring the UN into Iraq for humanitarian work and the talk of violations of international law will be forgotten.

The important issue in this wrangle is not that of international law itself but that other powers are now willing to confront the US, and that, as we have predicted for years, opposing imperialist blocs are arising. As has been said above the real argument over Iraq is about the division of its oil and the revenues from this which, in a few years time, could amount to some $26bn annually. (4)

This war can only bring closer the consolidation of the blocs of nations opposed to US hegemony. It will, therefore, bring closer further imperialist wars and ultimately world war. Although the war has apparently driven wedges between the countries forming the EU, this is likely to be a superficial result which the EU will take steps to prevent recurring. The institutional structures of the EU will be strengthened and this will be reflected in the constitution now being drafted. The leaders who have sided with the US will be isolated and put under pressure to support the core countries. The forces impelling the EU towards greater unity and the formation of a bloc opposed to the US, are economic and ultimately these will bring the political superstructure which rests on them into conformity. In all this the odd man out remains the UK. The mid Atlantic position, adopted by successive UK governments has been abandoned by Blair and his cronies for one of slavish kowtowing to the US so that the British position is now almost untenable. Blair is about to come to grief on the same banana skin which brought Thatcher down, the issue of the UK’s relationship to Europe (its biggest trading partner) and it relationship with the US (its biggest source of outward investment).

Motives for the War

Recent developments and statements from the US have shed further light on the real motives for the war. These motives are the securing of long term oil supplies for the US and controlling the oil price, the control of all oil supplies and transport routes from the Gulf region, and the establishing of a strategic bridgehead from which to attack other states opposing US dictates such as Iran or Saudi Arabia. Most of these objectives have been dealt with in RP 27 (5) and we refer readers the text “Countdown to war with Iraq” for a detailed discussion of these motives. We will, however, briefly summarise the main conclusions of the argument before looking at the developments which have occurred in recent months. The continuing importance of oil is shown by the fact that 62% of the world’s energy still comes from oil and gas, and the growing importance of the Middle East as a source of energy is shown by the fact that this area contains the 65% of the world’ oil resources which will outlast those in other regions. The US which today imports 60% of its oil is expected to import 90% by 2020. (6)

Oil resources from the Middle East are thus becoming more important to the US than ever before. By occupying Iraq the US is seizing the second largest oil reserves in the world. These will secure for the US a safe long term supply of oil and enable it to control the price and if necessary destroy OPEC. The US will also be able to control the price and the flow of oil from this region and ensure it continues to be traded in dollars.

Given these objectives it was, therefore, no surprise to be informed by US secretary of state, Powell, that the first objective of US forces would be to seize the Iraqi oil wells. Already the great oil companies have started to haggle for a share of the fat cake which is about to become available. The Iraqi oil industry, which was nationalised in 1972, has, since the Gulf War, provided concessions to certain oil companies, notably, those of France, Russia, China and Italy who together hold $3 8bn worth of concessions. British and US oil companies, hitherto excluded from Iraq, are now barely concealing their excitement. BP and Exxon have called for a “level playing field” which is a coded way of demanding that concessions already awarded to the likes of Totalfinaelf of France, or Lukoil of Russia be renegotiated. Both Shell and BP have discussed with Blair the possibility of claiming a stake in Iraq’s oil reserves. Whitehall officials now openly speak of a production sharing scheme whereby some of the proceeds would go to Iraq and some to the oil companies. The proceeds going to Iraq would, of course, be used to cover the costs of the war and the military administration. With the lifting of sanctions, new exploration and investment, Iraqi oil production could be tripled to at least 7 million barrels a day (mbd) which could be used to secure stable supplies for the US and a reduction in price. This could also be a significant threat to OPEC.

A further advantage of US occupation of Iraq would be that Iraqi oil would again be traded in dollars. In November 2000 Iraq switched the currency in which its oil was traded from dollars to Euros. Although Iraq is the only producer to have made the switch other countries such as Venezuela and Iran have been considering doing the same. If more countries, or OPEC as a whole, were to do this it would be a serious setback for the US and a corresponding gain for the Europeans. This could seriously affect the dollar’s role as the currency for international trade outside the US, particularly, of course, for the trade in oil. The dollar’s importance in world trade can be seen from the fact that in 2000 half of the world’s exports and 80% of the world’s foreign exchange transactions were carried out in dollars. This shows the massive extent to which the dollar circulates outside the US as a fiat currency over which the US has ownership. This brings massive benefits, namely an unearned income of approximately $500bn annually. (7)

Increases in currency corresponding to increases in the volume of world trade can be covered by the US issuing more paper currency without causing inflation. In addition the holders of dollars who wish to invest their surplus, much of it derived from the US current account deficit, are obliged to do so in the US. This ensures a continual flow of dollar capital to the US from the rest of the world. In effect the US levies a tax on the rest of the world for its use of the dollar.

At present the US has a trade deficit of approximately $500bn annually and a national debt of $63 00bn. This will be difficult to sustain. It would become impossible if the dollar started to lose its position as a global reserve currency. Not only would the tax on its use dry up but its value would fall. An indication of what could occur has been seen in the last few months when large switches in dollar holdings to Euro holdings have seen the currency drop by 25% against the Euro. (See the text “Dollar in continual decline against the Euro” in this edition.) This decline could threaten the massive flows of capital which the US needs daily to fund its deficit and its debt payments. If these flows were seriously threatened, the US would be forced to raise interest rates which would in turn increase the payments it must make to service its debts and it would reduce economic activity. This could also create massive individual bankruptcies because of the enormous level of personal debt in the US, which could lead down a path of banking failures, deflation and a slump of 1929 proportions. The invasion of Iraq serves as a means of bolstering the dollar’s position as the currency of the oil trade by force of arms, and much is at stake in this.

These considerations illustrate two further important issues which lie behind this war. The first is that, like all imperialist wars, it is directly related to the needs of the US economy. This, and not Saddam and his supposed weapons of mass destruction, is the real threat to the US capitalist class. The second is that the threat to the dollar is coming from the Euro, whose core countries are France and Germany. This is why these states are correct in understanding this war as a blow directed at their interests.

Iraq after the war

The US’s preferred option has always been to retain Iraq as a unitary state in its present form and resist demands for Kurdish independence or autonomy for the Shiite areas. This was emphasised in a particularly bloody way in 1991 when Bush Senior left Saddam to butcher Kurds and Shias who dared to raise their separatist ambitions.

Today these two groups will be similarly sidelined by the US. It may be that the US is even intending to retain the existing Ba’athist state structures and simply replace the top echelon of Saddam placemen with Pentagon placemen. The glorious ambition of democracy and freedom which Bush is always promising is on its way a short distance behind the cruise missiles, bombs and tanks will never arrive. Any free election would bring either a Kurdish or a Shia regime to power which, of course, is the last thing the US wants. This is why they intend to use 55 000 Turkish troops to hold down the Kurdish areas, while British troops control Basrah and the south and the US holds down the rest of the country.

To fund the occupation, the US has made clear that oil revenues will be taxed and, in addition, blocked Iraqi accounts both in the US and in the UN account will be used to pay expenses of the occupation and the war. In other words, Iraq is to pay for its own conquest and occupation in the classic manner of imperialism. The US intends to bring in the UN, despite its failure to authorise the war, as a humanitarian agency to continue with the oil for food programme and to distribute food and other emergency supplies. Meanwhile the US itself will run the country and continue with the main task of getting its hands on the country’s oil.

Much, however, could still go wrong with the US plans. The difficulties it has had in installing its armoured division in southern Turkey is an indication of the type of problems which could lie ahead. The US assumed it could bribe and threaten Turkey to get what it wanted, however the Turks demanded bigger bribes than the US was prepared to pay. The US offered $6bn in grants and $20bn in loan guarantees, but the Turks demanded $92bn. After a lot of haggling, the Turks came down to $30bn and Powell was sent to Turkey to sort out a deal. The final offer of the US came down to $1 6bn, but this was rejected by the Turkish parliament. The Turkish government, which also demanded the offer in writing indicating a clear mistrust of the US, said it would resubmit the request to the parliament after the UN delivered a resolution authorising war! All this infuriated the US which has declared that no grants would be made to Turkey. Much of their heavy equipment destined for the Kurdish front has had to be shifted to Kuwait. The failure to secure grants and the crisis provoked by the collapse of trade with Iraq could plunge Turkey’s economy into acute crisis. Also, if the US fails to place its armoured troops in Kurdistan the plan of allowing 55000 Turkish troops to occupy the region could lead to bloody conflict with the Kurdish nationalists. In addition Iranian backed Iraqi opposition troops, the so-called Badr brigade, have entered Kurdistan. These are Iraqi Shi’ite forces recruited from the south of Iraq and trained by the Iranian revolutionary guards. The reasons for their entry into Kurdistan are not clear, but their presence is another dangerous factor and an indication that the Kurdish problem could still explode with unexpected consequences for the US.

The US is also bound to face other political problems elsewhere in the region which will come in the wake of its onslaught on Iraq. Popular anger at US imperialism is likely to rock the regimes of Saudi Arabia, Jordan and Egypt and could produce acute instability throughout the region prompting direct US intervention to protect its interests.

Another problem for the US is the whole question of payment for this adventure. Without a UN resolution, it is unlikely to secure payments from its allies as it did for the Gulf War, particularly as many of these allies oppose the war and regard it as illegal. Although the US plans to loot Iraqi bank accounts and take income from Iraqi oil it is unlikely that these will be sufficient. The cost of the war is estimated to be $95bn and the US government has already requested the Congress provide $80bn in additional funding to cover the cost of the war. In addition, the cost of the occupation will probably amount to another $1 00bn annually. Confiscating Iraqi bank accounts and the income from a year’s oil production would cover less than half the cost of the war. If fighting destroys the oil wells, as occurred in Kuwait, the income from Iraqi oil, which the US assumes will be in its hands, may take years to materialise. In the short term the US economic crisis is likely to be made worse by this adventure. Already the Congress is talking about halving Bush’s famous tax cutting package. In the short term the US economic crisis is likely to be made worse by this adventure.

Of course, the US planners are aware of all these things and have concluded that the long-term interests of US imperialism demand taking these risks. As far as the popular Arab anger is concerned they have adopted the adage of the Roman Empire, “let them hate, so long as they fear”.

Turn the imperialist war into a class war

As we have pointed out, the causes of this war are rooted in capitalism’s problems of profitability which are severely limiting accumulation of capital. The Bush Junta hopes, by means of this bold stroke to cut through the knot of economic and political problems in which it finds itself entangled. As has been said above, it hopes, by means of controlling the oil resources of the Middle East to achieve a guaranteed supply at lower and stable prices. It also hopes to be able to limit supplies and thus increase the prices which its competitors pay. At the same time it aims to retain the dollar as the currency of the oil trade, and thus of international trade generally, and so continue to reap the rich rewards which this brings. It is for this reason that the skies above Iraq are about to rain down missiles and bombs in a barbaric onslaught which will leave tens of thousands dead in the first days of the war. The war is, therefore, quite clearly an imperialist war waged for the interests of US capital as a whole but with the oil and military interests in the vanguard.

It is a war which will see workers mobilised behind their capitalist exploiters in the name of nationalism, and workers in their workplaces will be asked to make sacrifices for the war. Already the UK firefighters are being asked to suspend their strike for the sake of the imperialist interests of their exploiters. At the same time workers in uniform are being called to kill their Iraqi class brothers. All this is in direct opposition to the real interests of the working class which demand both total opposition to their capitalist exploiters whatever the circumstances, and international solidarity with workers of other countries. Workers have no country!

Since its formation in the 1920’s the Italian left communist current, to which the CWO belongs, has defended the policy of revolutionary defeatism in the face of all capitalism’s wars. This means that imperialist wars should be turned into class wars, that is to say, civil wars between the capitalist class and the working class. As we have pointed out many times, this was the policy adopted by Lenin at the outbreak of the First World War in 1914 which eventually led to the revolution of October 1917. Today this remains the only position which can defend the interests of the working class and which can eventually lead to the overthrow of this rotten system under which we live. Although we are fully aware that today this is a distant prospect, and that the working class is dominated by the ideology of the capitalist class, this policy represents a direction of orientation and a pole around which revolutionaries can rally both now and in the future. This present war is merely the latest of a series of wars which will stretch away into the future on a road which is clearly leading to another world conflagration. The capitalist class cannot deviate from this road since the forces pushing it in this direction are located in capitalism’s economy itself. The only way this drive towards war can be halted is through class struggle, class war and revolution. As we have said before, the choice before us is not between “war and peace” it is between “imperialist war and class war.” We call on workers to:

  • Refuse all sacrifices for the war.
  • Continue the class struggle.
  • Stage strikes in the war industries.
  • Refuse to transport war materials.
  • Turn the imperialist war into a class war for the overthrow of capitalism and the establishment of communism.


Workers have a world to win!


(1) Karl von Clausewitz On War, Book 1, 1.24.

(2) See “Countdown to war with Iraq”, RP 27.

(3) Quoted by N Chomsky, Rogue States.

(4) This assumes production is increased to 7mbd and is sold at $25 per barrel while production cost is $4_barrel and half the surplus is taken by the oil companies. In fact, the figure could be larger, as production costs are lower than in Saudi, only $0.4 to $0.75 per barrel. See Financial Times, 21/02/03.

(5) See the Energy Plan produced by Vice President Cheney and released in May 2001.

(6) See “Control over the oil market in an epoch where finance capital dominates” in Internationalist Communist No. 18.

(7) Ibid.

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