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9/11 SYNTHETIC TERRORISM MADE IN USA

CHAPTER III: THE ROOTS OF 9/11: THE GLOBALIZED CRISIS OF THE 1990s

I'm not going to start the Third World War for you. General Sir Michael Jackson to Wesley Clark, June 1999

Contrary to popular belief, the 9/11 events were anything but a bolt out of the blue. They grew out of the severe and increasing global instability of the world and of the United States during the 1990s. These years were marked by repeated trips to the brink of systemic breakdown crisis of the world financial and monetary systems, against a backdrop of recrudescence of the great power tensions among the US, Russia, and China which had supposedly been relegated to the past at the end of the Cold War. The US political system was exhibiting many of the crisis symptoms of Weimar Germany ( 1919- 1933). The common denominator of the tempests of the 1990s was financial globalization as expressed in the form of the Washington Consensus, which proved itself to be an absolutely unworkable way of organizing the economic life of the world.

Within this crisis, there were aggressive, militaristic and lawless networks at work within the United States. One of these was the Dulles Brothers-Lemnitzer-Lansdale network as it had emerged from the Iran-contra years; this was the world of the asteroids, or privatized intelligence community operations. The events of 9/11 should redirect our attention to these lawless networks inside the US government which have periodically asserted themselves, with devastating consequences. This is the network which we can associate with the U-2 crisis, with the Bay of Pigs, the Kennedy assassination, the Gulf of Tonkin incident, the Martin Luther King assassination, the Robert Kennedy assassination, Watergate, Iran-contra, and a score of lesser events. Another aggressive and adventurous network was the neocon network, always calling for new wars to be fought by other people's children.

As Sanguinetti points out, modern states tend to resort to terrorism and violence during their birth, when they are in severe crisis, and in the process of their extinction. In the 9/11 instance, the roots of terrorism are to be sought only marginally in events taking place in the Middle East, and certainly not in any distant cave in Afghanistan. Monocausal explanations embraced by corporate elites, such as the Hubbert "peak oil" thesis, are also unsatisfactory, since we are dealing not with geological events per se, but rather with the breakdown crisis of a political economy.

OLIGARCHICAL MALTHUSIANISM THEN AND NOW

From 9/11 to "peak oil" is a dangerous leap, and from "peak oil" to population reduction is more dangerous still. Because oligarchs have always held humanity in general in contempt, they have from time immemorial exhibited the outlook which has, during the last 200 years, been called Malthusian. Back among the early Greeks, one school of thought explained the Trojan War as necessary to remove the weight of the masses of mankind which were oppressing the breast of Mother Earth. Together with the axiomatic notion of overpopulation has gone a profound hostility to science and technology, especially because of their egalitarian effects. During the time of Thucydides in Athens, the writer called the Old Oligarch complained that the high-tech Athenian navy was helping the plebs to achieve upward mobility, while the equally high-tech long walls between Athens and Piraeus kept the armies of oligarchical Sparta at bay. During the agony of the Roman Empire, the decrees of the Emperor Diocletian in effect banned technological progress by making it illegal to alter the equipment and property of any guild. During the decline of the Venetian Empire, the decadent Giammaria Grtes (1713- 1798) elaborated the  notion that the earth had an absolute and unalterable maximum carrying capacity, which he set at 3 billion persons. Ortes was the original from which the English Reverend Thomas Malthus copied. Malthus' well-known contention that population increases geometrically while food supply increases arithmetically stands in contradiction with thousands of years of successful human development. Malthus' real interest, it should be remembered, was to convince capitalists that they had to pay to maintain a numerous state church made up of people like himself, whose consumption  would make sure that no crises of overproduction occurred. This was Malthus' notorious slogan, "The church with a capacious maw is best." Malthus was in turn the key to the bankruptcy of Darwin, who based himself on the greedy prelate. There is no doubt about evolution, but Darwin is a completely separate kettle of fish, especially his wayward thesis about the "blind watchmaker," meaning that the universe is a totally random process. The present writer agrees rather with Leibniz's view of a least action universe which has a definite in-built tendency towards greater order, greater energy organization, and greater development.

The fatal flaw of Keynesian economics is that they are based on Malthusian premises: there is a surplus which has to be consumed, and Keynes is unable to distinguish between productive and parasitical ways of doing this. In more recent times, the Malthusian outlook has been promoted with great success by the sinister Club of Rome, founded by Alexander King and Aurelio Peccei. The Club of Rome sponsored that infamous hoax, the 1968 Meadows and Forrester Limits to Growth. This fraudulent study took a snapshot of the then-known reserves of the main industrial commodities, and then simply extrapolated when these would be gone, based on the current rate of consumption. Almost forty years later, not one of these dire predictions has come to pass, and known reserves of many raw materials are greater than they were in 1968.

In 1971-1973, the long period of world economic expansion associated with Franklin D. Roosevelt's Bretton Woods system and postwar economic reconstruction came to an end in a series of monetary crises that destroyed the most successful monetary arrangement the world had ever seen. Since 1971-73, long-term economic growth in the main industrial countries has been cut in half: from about 5% per year to about 2.5% per year. This, plus the later push for deindustrialization, is the main reason why living standards in the US have declined by about 50% over the same period, and the costs of essential services like health care and education have gone into the ionosphere. After 1971-73, we are no longer dealing with a normal economy, but with an increasingly sick one.

THE FAKE OIL SHOCKS OF THE 1970s

Building on the lies of the Club of Rome and the Limits to Growth, Wall Street, the City of London, and the Federal Reserve, backed by the Seven Sisters Anglo-American oil cartel, decided to jack up the price of oil to save the dollar while making western Europe and Japan foot the bill. This cynical maneuver was associated with Henry Kissinger's Kippur War in the Middle East of October 1973. After the hostilities began, the Organization of Petroleum Exporting Countries (OPEC) announced an Arab oil boycott. In late December 1973, the OPEC speeches had become  the pretext for a 400% increase in the price of oil carried out by banks and speculators in the commodity trading pits of New York and Chicago. OPEC was blamed, but OPEC was never the real cartel. OPEC was largely a Potemkin cartel. The real cartel were the Seven Sisters. Without the connivance of the Seven Sisters and their Royal Dutch Shell/British Petroleum  leadership, none of OPEC's antics could have been made to stick. In reality, there had been no reduction in oil deliveries to the US. In December 1973, oil-bearing supertankers of the leading oil companies were put into a holding pattern on the high seas because storage facilities were already full to bursting with crude. But that did not stop greedy speculators from bidding up the price.

The plan for the entire exercise had been provided by Lord Victor Rothschild, the sometime head of a think tank attached to Royal Dutch Shell, the dominant force within the Seven Sisters oil cartel. The operation had been discussed at a meeting of the self-styled Bilderberger Group of finance oligarchs held at Saltsjobaden, Sweden on May 11-13, 1973. The effect of the oil price hike was to create a massive artificial demand for US dollars, thus effectively saving the greenback from a short-term collapse which would have ended its role as a reserve currency, and would have also ended the ability of US-UK finance to loot the world using this mechanism. In particular, if the posted price of oil were no longer expressed in dollars, then New York and London would no longer exercise de facto control over the oil reserves of the world. The 1973 oil crisis, followed by petrodollar recycling from the OPEC countries to David Rockefeller's Chase Manhattan Bank, kept the dollar in demand and thus prevented it from being dumped. Of course, the world paid the price for all this wizardry in the form of the deepest recession since World War II.

In 1978-79, Carter and Brzezinski, acting in the service of Brzezinski's lunatic thesis that Islamic fundamentalism was the greatest bulwark against Soviet communism, toppled the regime of the Shah of Iran. In line with this project, the U.S. also made sure that the Shah was replaced by  Khomeini, who embodied the negation in toto of modern civilization. Having done so well on the fake 1973-74 oil crisis, the New York and London finance oligarchs decided to repeat the operation, this time using the spectre of Khomeini's self-styled Islamic revolution. This time prices went up by another 200%. When 1979 was over, it emerged that world oil production had not fallen, but the prices stayed up anyway. The 1979 doubling had more dramatic economic effects than the 1973 quadrupling, since the world economy was much weaker by 1979.

CHENEY WANTS $100 A BARREL OIL

When we see a book like Paul Roberts' The End of Oil being hyped by Lou Dobbs on CNN, accompanied by a barrage of articles in the controlled corporate media on this same line, we can see that an Anglo-American consensus in favor of $100 per barrel oil is developing. The rationale is not hard to find, and has little to do with geological facts: the US dollar is once again in terminal crisis, and oil at $100 per barrel would create a new wave of artificial demand, making the dollar a little more attractive for oil producers and others, and perhaps staving off for a few more years the end of its reserve currency and posted price status. It is reported that the center of the agitation for $100 a barrel oil is, not surprisingly, the Vice Presidential office of Dick Cheney, managed by the ruthless neocon operative Lewis I. "Scooter" Libby.

As far as the substantive argument about oil reserves is concerned, it is clear that oil should be used less and less as a fuel, and employed rather for petrochemicals. It is also clear that the internal combustion engine is now a technology that is more than 100 years old, and is due to be replaced. However, it is also clear that a growing world population and, hopefully, increased levels of world economic development will require greater energy sources. Every fixed array of human technology in world history has always defined certain components of the biosphere as usable resources, with the inevitable corollary that these resources would one day be exhausted. Under such conditions, the great imperative of human evolution cannot be retrenchment and austerity, but rather innovation, invention, discovery, and progress. If existing energy sources are insufficient, then science will have to find new ones, without ideological preclusions. Solar energy gathered outside the ionosphere in earth orbit might be one future solution. The one thing we must not do is to leap from a rising oil price to coerced population reduction, since that represents the core program of the Malthusian Anglo-American oligarchy, and has been in place as a policy goal since Kissinger's infamous NSSM 200 [2] and the Global 2000/Global Futures campaigns of the Muskie State Department under the disastrous Carter administration.

The pervasive oil and raw material grabs of today's world suggest nothing more than world economic breakdown and imminent world war. In 1941, Japan's main war aim was to secure the oil of the Dutch East Indies. Hitler's panzer divisions in Operation Barbarossa were pointed towards Baku, which was Stalin's oil aorta. Stalin's own attack plan aimed at Ploesti in Romania,  Germany's sole source of oil. Each of these plans sought to deny oil to an adversary and procure it for their authors as a means of winning a war. Much the same dynamic is afoot today, partially under the cover of "peak oil."

US OLIGARCHICAL CONSENSUS FOR TERRORISM

During the 1990s, the US oligarchy came to a consensus regarding the need for synthetic terrorism to preserve its system of rule under conditions of increasing economic and financial breakdown. This consensus was elaborated through commissions associated with names like Hart and Rudman, Gillmore, Rumsfeld, and the New York Council on Foreign Relations. Terrorism, the oligarchy concluded, was needed to maintain the cohesion of the hierarchical system, and the legitimacy of irrational domination. This was in line with the Carl Schmitt "enemy image" thesis, as elaborated more recently by Samuel Huntington. Terrorism was also needed as an instrument of maintaining Anglo-American world domination, especially to wage oblique warfare to isolate, weaken, and contain powers like Russia, China, Japan, and some others who were too strong to be openly attacked on the Iraqi model. This type of terrorism was a continuation of the NATO geopolitical terrorism, whose goal was to maintain the Yalta division of the world against the self-asserting and self-liberating tendencies of countries like Germany, Italy, and others. Terrorism would serve as well to prevent threatened defections from the dollar zone, and shore up the battered greenback as the world's residual reserve currency. Terrorism would also help to consolidate US-UK control over oil, strategic metals, and other critical raw materials, in part by weakening and destabilizing economic nationalist or pro-development third world regimes.

9/11 must rather be viewed as a symptom of a perhaps insoluble crisis inside the US political and economic system. Whether or not the crisis of the 1990s represents the first phase of the terminal crisis of the United States as presently constituted remains to be seen; by contrast, there can be little doubt that the post-1945 hegemony of the US dollar as the world's reserve currency is now ending, and that is more than enough to generate the cataclysmic events observed.

Complacent and superficial commentators like David Brooks have attempted to portray the 1990s as a time of idyllic tranquility, when the polyanna US failed to pay attention to the gathering storm of terrorism "out there." In reality, the 1990s were a period of aggravated financial and economic breakdown and of severe if masked tensions among the US, China, the USSR, and other states. The United States devastated Iraq at the beginning of the decade, destroying the civilian infrastructure with the cowardly and duplicitous "bomb now, die later" policy. The US said at the time that coalition aircraft had flown 120,000 sorties over Iraq. If each sortie had killed just one Iraqi, that would already have been 120,000 dead; the reality was probably three or four times greater. The unspeakable suffering in Iraq was made much worse by the US-backed and UN- enforced economic sanctions of 1990-2003, which, in violation of all relevant international law, banned the import of food and medicine completely until certain limited purchases were allowed under the UN oil for food program in the later 1990s. The estimates of the number of Iraqi victims of these murderous sanctions vary widely, but it seems likely that the number of fatalities involved is between 500,000 and 1,000,000, with infants, children, and elderly people -- all non-combatants -- accounting for the majority. Some estimates take the death toll above 2 million Iraqis. When once asked about this policy, Madeleine Albright replied that in her opinion it was "worth it" to contain Iraq. During the 1990s, the present writer warned repeatedly that the economic sanctions were sowing a harvest of hate among Iraqis with which the US would one day have to reckon. The harvesting of that accumulated hate began in 2003, with a vengeance. All this was compounded by the unilateral imposition by the US and UK of no-fly zones in northern and southern Iraq, which involved the almost daily bombing of Iraqi targets during the entire decade of the 1990s. The Gulf crisis of 1990-91 disrupted the regional economy and led to the collapse of Somalia, where the lame duck Bush intervened just after Thanksgiving 1992. This was billed as a humanitarian mission, but US political meddling led to resistance by certain groups, and an orgy of gratuitous killing of black-skinned Arabs resulted.

THE 1990s: DECADE OF US FINANCIAL CRISIS

During these years the US was lurching from one financial crisis to the next. For a full account of this process, see my Surviving the Cataclysm (1999). The entire energy of the system was expended on impossible efforts to shore up the speculative edifices of stocks, bonds, and derivatives, which were always on the brink of panic collapse. The specter of some bankruptcy or panic setting off a systemic crisis, the implosion of the entire world dollar-based system, was a constant threat during the 1990s. US financial policy makers have been caught for decades in an impossible predicament. If they lower interest rates to keep the domestic system solvent, hot money will flee abroad, tending to collapse the overvalued dollar. If they raise interest rates to make the dollar more attractive, domestic bankruptcies begin to multiply. Fed governor Paul Volcker's worst nightmare had been an accelerating dollar collapse which could not be stopped. The stock market crash of 1987 was in reality sandwiched in between two dollar crises which had the potential of sinking the battered and bloated greenback. That same stock market crash of 1987 brought on a collapse of the commercial real estate market in many cities, causing the bankruptcy of real estate firms like Olympia and York in 1992. As the real estate market collapsed, it undermined the main US money center banks. In 1990 the Bank of New England went bankrupt. Just as bankrupt from a technical point of view, but too big to fail because of the economic and political repercussions, were the twin giants of US  banking, Chase Manhattan and Citibank. In July 1990, bank analyst Dan Brumbaugh stated on the ABC network program Nightline that not only Citicorp, but also Chase Manhattan, Chemical Bank, Manufacturers Hanover and Bankers Trust were all already insolvent. During September 1990, there was a near electronic panic run on Citibank, while Chase Manhattan, and other New York money center banks were also under increasing pressure. Around Thanksgiving 1990, Citibank was quietly seized by federal regulators who then proceeded to run it for more than a year; the controlled media were silent to prevent panic runs, although they did not wholly succeed. In August 1991, Rep. John Dingell (D-Michigan) observed that Citibank was "technically insolvent" and "struggling to survive." Lloyd's of London also defaulted around this time. In the background, Russia had lost two thirds other productive activity as the result of IMF shock therapy. By the middle of the decade, former Secretary of the Treasury Brady reported that there was $1 trillion per day in currency speculation alone. Much of this was related to a new, parasitical, and highly unstable form of financial vehicle -derivatives. Felix Rohatyn of Lazard Freres admitted in the spring of 1994 that he was nervous about the derivatives crisis "because the genie is out of the bottle and could touch off a financial nuclear chain reaction, spreading around the world with the speed of light." By the end of the year Grange County, California had gone bankrupt because of derivatives dealings, reporting a two-billion dollar loss. But that was peanuts. In January 1995 Mexico went bankrupt, bringing the world banking and financial system to about 48 hours from a total world-wide meltdown; at stake here was implicitly the huge mass of debt owed by the developing countries, which had reached $1.6 trillion. The tequila crisis required a $50 billion bailout which was thrown together in extremis by the Clinton administration. Camdessus of the IMF noted with much alarm on February 2, 1995 that "Mexico was in  imminent danger of having to resort to exchange controls. Had that happened, it would have triggered a true world catastrophe." A few weeks later Barings Bank of London, one of the world's oldest financial institutions, went belly up, and contrived to blame the default on a rogue trader.

AUGUST -SEPTEMBER 1998: RUSSIA AND LTCM TAKE WORLD TO BRINK

In 1997 the Asian contagion crisis began in earnest; it was in reality another crisis of the world dollar-based system. This led on August 17, 1998 to the default and state bankruptcy of Russia, with a series of banking panics wiping out the savings of the middle class. Russian economic reform, better known as IMP shock therapy, had been the great international financier project of the first half of the 1990s, and it ended in dust and ashes. Anti-oligarchical Russian economist Tatyana Koryagina observed around this time that "the world economy has reached the point where -- if economic liberalism is a dead- end street, it has hit the concrete wall at the end of the street. This liberalism will explode the entire economy and then there will be global chaos, which will be economic fascism. A 'New World Order' is economic fascism, when a huge number of people are thrown into desperate poverty, and only the speculators make any profit. We are on the verge of a particular sort of anti-financier revolution -a revolution against financial speculators." (Tarpley 1999 chapter 1 )

When Russian blew up, real panic spread around the world. The newspaper that expresses the views of the Swiss financial community noted with consternation: "With the ruble collapse and the de facto state bankruptcy of Russia, the crisis which has been boiling for a year is now threatening to turn into a global GAU" -- Großten aller Unfalle, or worst possible catastrophe, wrote this paper. "Like dominoes, one currency after another, one financial market after another, are falling allover the globe. The specter ofa worldwide recession is spreading." (Neue Zuricher Zeitung, August 29, 1998)

The Russian state bankruptcy in turn provoked the failure of Long Term Capital Management (LTCM), a giant Connecticut hedge fund with close ties to the US Federal Reserve. With LTCM, the world banking system was once more on the brink of systemic meltdown. Only a crony capitalist bailout of LTCM's creditors by Greenspan prevented the immediate collapse of the US money center banks, the US securities markets, and the reeling US dollar. LTCM had posed the immediate danger of a chain-reaction bankruptcy of the entire world banking system, leading to financial and monetary chaos. The New York Fed, in the person of its President William McDonough, -undertook an emergency bailout as lender of last resort for the syndicate of big banks that were scrambling to save themselves by taking over LTCM, which was bankrupt with a reported $1 trillion in derivatives outstanding. Long Term Capital Management was leveraged at 500:1, but what of that? J.P. Morgan was leveraged at over 600:1, with $6.2 trillion in derivatives as against just $11 billion in equity capital. The story was broken by David Faber of CNBC on the afternoon of Wednesday, September 23, 1998. Within a few days, Union Bank of Switzerland announced a $685 million loss, and Dresdner Bank said it was $144 million to the downside. LTCM' s total loss was about $4 billion. If the US banks had gone under, the FDIC would have had to pay depositors, and the taxpayers would soon have had to bailout the FDIC. Between August 29 and October 19, currency in circulation grew at an annual rate of 16.4%, and the M3 money supply grew at 17% annually. Greenspan was using system repurchase agreements, coupon passes, and open market operations to churn out liquidity. The dollar softened and the gold price spiked upward: there were reports that central banks were replenishing their gold stocks in the face of the hurricane. Between late September and early October, the dollar managed to fall ¥ 10 (or, in forex jargon, "ten big figures") in just 10 days. In August and September 1998, the world finance oligarchy had been forced to look into the glowing bowels of Hell. The half- million bankers and fund managers who are the chief beneficiaries of the globaloney system had felt the icy breath of panic on their necks. But their near-death experience had not impelled them to consider any serious reforms.

By the end of 1998, the debt superpower of Brazil was on the brink of default, once more threatening to bring down the banks of Wall Street. George Soros demanded that the banks be protected by a "wall of money," and Greenspan complied. Using the pretext of providing liquidity to cushion the shocks of the transition from 1999 to 2000, when multiple computer breakdowns were feared, Greenspan began to print fresh US dollars at an unprecedented rate. Much of this new cash rushed into the NASDAQ stock market, where it stoked the merging dot com bubble. But by the early months of 2000, it was clear that the dot com companies still had no profits, and their high burn rate of cash on hand spelled the end of the bubble. In a spectacular decline that did not stabilize until the middle of 2002, the NASDAQ lost a breathtaking 75% of its value. Many hedge funds,  banks, and insurance companies were on the verge of imploding, but Greenspan kept pumping new dollars to stave off chain reaction bankruptcies. Interest rates reached new historical lows, and oil producers began to consider dumping the dollar in favor of the more stable euro, which was now available as an alternative. A housing bubble and a bond market bubble now emerged in the US. Greenspan's response was to tout the "wealth effect," meaning that the housing bubble was raising the fictitious value of private homes, allowing home owners to take out second mortgages and use the cash to speculate in the stock market. The bond bubble began to falter in the spring of 2004. In the meantime the entire system had been back to the brink in late 2001 and early 2002 with the declaration of a formal debt moratorium -- a payment halt -- by Argentina. Derivative financial instruments were always close to detonating a systemic crisis; there is some evidence that a derivatives disaster of the first magnitude had overtaken Citibank around the middle of 200l, but was papered over by Federal Reserve loans under the cover of 9/11. Citibank was forced to sell Travelers Insurance for $4 billion, apparently to raise cash to plug a considerable hole.

Towards the end of the decade, Eisuke Sakakibara of the Japanese Finance Ministry a well-known official who had earned the nickname of "Mr. Yen" in the world press, had summed up the problems of the US-UK system as follows: "... I think the financial system we have today is inherently unstable. We need to set up a new system to stabilize financial markets. Otherwise, the repetition of crisis after crisis. ..is going to result in a major meltdown of the world financial system." -- (Japanese Finance Ministry, January 22, 1999)

TO THE BRINK OF SYSTEMIC BREAKDOWN: Financial Crises and Panics After 1987

END OF DOLLAR HEGEMONY?

Perhaps most serious for the Anglo-American system of world domination was the impact of these events on the fate of the US dollar. By virtue of the Bretton Woods agreement of 1944, the dollar had replaced the British pound as the world's reserve currency. The Bretton Woods system disintegrated in 1971-73, and we are now living among its rubble, but the primacy of the dollar has remained unchallenged. This means that most world trade was and still is conducted in dollars, including Eurodollars based in London. The prices for the main raw materials, and especially oil, are quoted in US dollars. If Europe wants Russian or Saudi oil, it must pay in dollars, thus creating demand for a currency which otherwise might find few buyers, since the US produces so little to sell. This allows the US-UK banking community to skim 5-10% off all world trade by providing import-export financing; this used to be called invisible earnings. More important still, if the dollar is the only way you can buy oil, then whoever controls the dollars -- meaning the US -- will in effect control the oil, no matter whether it is nationalized or not, no matter who formally owns it. The role of the dollar in the posted price for Gulf crude is thus the central symbol of the world dominance of the dollar. And the dollar is the nerve and fist of US world domination.

As an anonymous expert quoted by William Clark correctly pointed out in early 2003: "The Federal Reserve's greatest nightmare is that GPEC will switch its international transactions from a dollar standard to a euro standard. Iraq actually made this switch in November 2000 (when the euro was worth around 80 cents), and has actually made off like a bandit considering the dollar's steady depreciation against the euro. ( http://globalresearch.ca/articles/CLA302A.html ) The dollar declined 17% against the euro in 2002.

IRAQ

For lraq, the decision to quit the dollar for the euro was an explicitly political one. Iraqi Finance Minister Hekmat Ibrahim al-Azzawi announced the move by saying: "The dollar is the currency of an enemy state, and must be abandoned for other currencies, including the euro," Azzawi said. The Iraqi central bank announced in October 2000 that it had begun to buy European currencies. (AFP via energy 24.com, October 12, 2000) Saddam Hussein stopped accepting dollars for oil in November 2000, and at the same time shifted ten billion dollars on deposit in the UN oil for food fund into the euro. Sure enough, the 2003 US occupation regime put Iraqi oil exports back on a dollar, rather than a euro, standard. The US invasion also helped to intimidate any nation which might have been considering switching to the euro. Since late 2001, the dollar was steadily declining and the euro was steadily gaining, with periodic plateaus, so those who chose the euro were rewarded to the tune of 20% or more. Bush's second axis of evil country, North Korea, switched to the euro on December 2, 2002. Here the economic impact was limited, but the political symbolism was still quite strong.

IRAN

The third of Bush bugaboos, Iran, which is also the number two OPEC producer, was also considering a move out of the dollar, and the arrival of US military forces next door was doubtless designed to dissuade the Iranians from such thoughts. The Iranian approach was less flamboyant and confrontational, but the threat to the dollar was there none the less. Iranian sources were quoted in September 2002 as remarking that "Iran's proposal to receive payments for crude oil sales to Europe in euros instead of U.S. dollars is based primarily on economics." Still, an anti-US political animus could not be denied, since dumping the dollar would be an "opportunity to hit back at the U.S. government, which recently labelled it part of an 'axis of evil. ' As this proposal was considered, Iran was moving currency assets out of the dollar anyway. Russian and China announced during 2003 that they were doing the same thing.

VENEZUELA

And what of Venezuela, the number four producer of oil? Here the CIA, with the help of Iran- contra veteran Otto Reich, attempted to overthrow President Chavez with a botched coup in Apri12002. Many saw this as a move to secure oil supplies in case the attack on Iraq got messy. But a year before the coup, Venezuela's ambassador to Washington, Francisco Mieres-Lopez, apparently floated the idea of switching the posted price for Venezuelan crude to the euro. Under Chavez, Venezuela also embarked on a policy of direct barter deals for oil, which had been concluded with about a dozen Latin American countries. In these cases the dollar was cut out of the oil transaction cycle, and the ability of the Wall Street banks to skim off these transactions was eliminated. Venezuela had for example a deal with Cuba under which Cuban doctors and health workers served in the Venezuelan countryside, while Castro got his crude oil needs covered in return, thus meeting a need that had been acute since the collapse of the USSR cut off oil deliveries to Cuba from Soviet fields.

INDONESIA

Pertamina, the Indonesia oil giant, showed every sign of jumping on the bandwagon. According to a Jakarta paper, in Apri12003, "Pertamina ... dropped a bombshell. It's considering dropping the US dollar for the euro in its oil and gas trades." The paper pointed to the "major implications for the world's biggest economy." ("Indonesia May Dump Dollar, Rest of Asia Too?" Jakarta Post, Apri1 22, 2003) In the same issue, two economists, Nur Azis and Jason Meade, from the Center for Indonesian Reform, Jakarta, urged that Indonesia cast off its dollar dependence. They argued that the dollar would "remain weak over the next decade at least, for a number of reasons."

MALAYSIA

The former Malaysian Prime Minister, Mahatir Mohamed, was perhaps the most outspoken against the dollar. He repeatedly called on oppressed Arabs to turn away from suicide bombing, and fight the US-UK combine with the far more potent weapon of dumping the dollar in favor of the euro. Mahatir was blunt about the need to replace the world dollar standard. In early 2003, Mahatir told a group of reporters that the international community needed to be encouraged to use other currencies or even gold as the benchmark in international trade. This was because the domination of the U.S. dollar in global transactions was distorting the world's economy. Mahatir suggested that the Euro, yen, or even gold should be used for transactions. "We should be given the choice to use whatever currency that we want," he said at a meeting with 31 foreign editors and senior journalists. He pointed to the greater danger of manipulation when international business is all conducted in one nation's currency. "For the purpose of trade, we shouldn't say that oil should be quoted only in U.S. dollars. Today, the oil price has gone up, but the value of the U.S. dollar has gone down, something that the people do not point out," he added. "The oil price today was not actually US $36 if this was compared with the value of the dollar a year or three years ago." Mahatir said he had read an article which pointed out that the United States was actually living on borrowed money and that it always faced a huge deficit. Despite that, he said, the u.s. economy continued growing at a tremendous rate for the past 10 years while Japan, which had made a lot of money and had very healthy reserves, was facing economic problems. "This is a contradiction. Why is this happening? It is simply because we are giving value to the U.S. dollar which it doesn't really have. There is nothing to back the U.S. dollar other than people's belief in it." (The Star, February 28,2003) Later in 2003, Mahatir, noting the fall of the dollar against the euro, told the Nikkei Forum in Tokyo: "The U.S. dollar is not a stable currency at all. We have to think of some other ways of determining exchange rates. We need to rethink whether we can depend on the U.S. dollar or not. Initially yes, we have to depend on the U.S. dollar, but we should move away from the U.S. dollar." (The Edge Daily, June 6, 2003)

SAUDI ARABIA: THE PARTING OF THE WAYS WITH THE US, AUGUST 2001

Most significant of all were the signs that even Saudi Arabia, long considered a client state or even a ward of the United States, was considering breaking away from the US system. Here the falling dollar, Bush's slavish support of Sharon, and preparations for new US attacks on Arab states were doubtless playing a role. According to the Wall Street Journal, Saudi Crown Prince Abdullah sent a letter to Bush at the end of August 2001 -before the events of September 11 -- and warned him, in reference to the US- Saudi relationship, that "a time comes when peoples and nations part." The letter went on to say that "it is time for the United States and Saudi Arabia to look at their separate interests. Those governments that don't feel the pulse of the people and respond to it will suffer the fate of the Shah of Iran." Prince Abdullah read from this letter at a meeting of 150 prominent Saudis in October 2001, in an effort to convince them that the Saudi government is defending Arab and Muslim interests. During a phone call with Bush around the same time, Abdullah again called for the U.S. to restrain Israel. Diplomats said that there was considerable debate within the Saudi royal family over the U.S. war in Afghanistan and the cost of the U.S.-Saudi relationship. One Western diplomat said that the failure to resolve the Middle East conflict was going to make it harder for Saudi Arabia to continue its relationship with the U.S. in the same manner. (Wall Street Journal, Oct. 29, 2001) Saudi Arabia was a pillar of the US empire; without it, the empire would collapse. For the imperialists, action was imperative to prevent this critical defection.

The dubious Michael Moore and others parroted the Mossad line that Saudi Arabia was responsible for 9/11. It is more likely that the unproven allegations about Saudi hijackers were cooked up as a means of blackmailing the Saudis, who were evidently ready to distance themselves from Washington.

THE EUROPEAN UNION

Europe for its part was eager to eliminate the dollar. Jacques Santer, former president of the European Commission, called on Gulf Arab oil exporters to price their crude in the euro rather than the US dollar as a means to stabilize the oil market. "It could be the instrument to consolidate oil markets" and would be less affected by US foreign policy, he told a Gulf-Euro conference in Dubai. ("Santer calls for oil to be priced in euros," The Irish Times Gctober 8, 2000) The biggest issue here was whether Russia would phase out the dollar in favor of the euro, as the Germans and others were proposing. In addition, dumping the dollar was popular. Newspaper columnists and antiw'ar activists in countries from Morocco to Indonesia shared the sentiments expressed in a Nigerian street protest witnessed by a Wall Street Journal reporter during the run-up to the Iraq war: "Euro yes! Dollar no!" ( http://journeyman.1hwy.com/J-Big-OneIIIb.html ) US elites had long been painfully aware of the colossal vulnerability represented by the world's dollar overhang - the masses ofdollars held outside of the United States. Republican Senator Pete Dominici of New Mexico commented on May 18, 1995: "What would happen if the Saudi Arabians said they didn't want to be paid [for oil] in dollars anymore, but wanted instead, to be paid, say in yen. There would be inflation that would make the 15 to 20 percent inflation in the early '80s look good." (C- SPAN II, 18 May 1995)

The impact of a world move to dump the dollar can be deciphered from the following commentary from an insider newsletter: "The US dollar is 'over-owned.' 77. 7% of world central bank reserves are in US dollars. That's disproportionate to the US share of world trade. There'll now be some diversification, especially to the euro. Just as central banks sold gold, they'll now sell US dollars. A study revealed at a central bank confab at Jackson Hole by Professors Obstfeld and Rogoff suggests the US dollar could drop 24%- 40% if foreigners move quickly to exchange dollars. Foreigners own a record 38% of US Treasury market (44% excluding Federal Reserve holdings), 20% of US corporate bonds, 8% of US stocks. A change of sentiment, now suddenly in the air, could start a dollar brushfire." (The International Harry Schultz Letter, January 19, 2001)

If oil producers in general were to make the leap from the dollar to the euro, many central banks would have to shift reserves into the European currency. The value of the dollar might crash between 20 and 40%, as Clark's article points out. The impact of this inside the US might be hyperinflation of 1000% or more per year. As the expert cited by Clark summed up: "One of the dirty little secrets of today's international order is that the rest of the globe could topple the United States from its hegemonic status whenever they so choose, with a concerted abandonment of the dollar standard. This is America's pre-  eminent, inescapable Achilles Heel for now and the foreseeable future. That such a course hasn't been pursued to date bears more relation to the fact that other Westernized, highly developed nations haven't any interest to undergo the great disruptions which would follow -- but it could assuredly take place in the event that the consensus view coalesces of the United States as any sort of 'rogue' nation. In other words, if the dangers of American global hegemony are ever perceived as a greater liability than the dangers of toppling the international order. The Bush administration and the neo-conservative movement have set out on a multiple-front course to ensure that this cannot take place, in brief by a graduated assertion of military hegemony atop the existent economic hegemony. The paradox I've illustrated with this one narrow scenario is that the quixotic course itself may very well bring about the feared outcome that it means to pre-empt. We shall see!" ( http://globalresearch.ca/articles/CLA302A.html )

The US economy was very sick indeed. Electrical infrastructure was at the breaking point, with major blackouts every summer. The air transportation system was bankrupt. Commuter and freight railroads were subject to constant breakdowns. The budget deficit was rising towards $500 billion - r $750 billion, and the merchandise trade deficit was rising towards $500 billion. The US public debt was headed towards $6.5 trillion, with over $4 trillion in foreign debt. The military forces were comprised often hollow infantry divisions -not an adequate force to conquer the world, except in a neocon fantasy.

THE CATASTROPHE OF GLOBALIZATION

After the fall of the East German communist regime in 1989, and 1:he extinction of the USSR in December 1991, the United States presided over the inauguration of a new era, that of the globalized world economy. I have discussed the main features of globalization in Surviving the Cataclysm (1999), my study of the world financial crisis. For our present purposes, it is enough to focus on the consequences of globalization. Globalization has completed the destruction of the United States as a political economy, and has substantially wrecked the entire world economy, as it was evident to clear-minded observers no later than 1992, when globalization began the demolition of the Russian economy. Together with globalization came the ascendancy of parasitical financier elites oriented exclusively towards short-term speculative gain in such areas as derivatives speculation, and perfectly incompetent in regard to the economic requirements of civilized progress. It was not September 11,2001 which destroyed the world as we had known it; it was the marauding and immiserating march of economic globalization.

The great lesson of the twentieth century was that financial disintegration and economic depression set the stage for world war. The same dynamic was at work during the 1990s. For most people in the United States, western Europe and Japan, this underlying dynamic was masked by currency arrangement centering on the dollar which tended to shield these parts of the world from the full fury of globalization, while inflicting intensified looting and impoverishment on the underdeveloped countries. But even so, the economic decline in the supposedly rich countries was breathtaking.

As the United States became financially more unstable and economically less viable, ruling elites began to exhibit greater readiness for military adventures abroad. This aggressivity was common to the Republican and Democratic wings of the oligarchy, but was somewhat alleviated by Bill Clinton 's personal distaste for foreign military adventures and keen awareness of the risks they posed for himself politically. But after the Monica Lewinsky crisis emerged at the beginning of 1998, executive authority was increasingly usurped by a group of high officials calling themselves the principals' committee, who carried out the bombing of Iraq (Operation Desert Fox) at the end of 1998, and who then turned to the bombing of Serbia in the spring of 1999. Not to be outdone, the neoconservative faction of the oligarchy attempted at the same time to stir up conflict with China, whose high rates of economic growth posed in their eyes the threat of the emergence of a new and competing superpower. Conflict with Russia, always latent, threatened at various junctures to erupt into more visible hostility.

The prevalent conception of Russia on the part of US foreign policy elites is that of a strategic adversary. Russia has retained significant parts of the strategic missile forces built during the Soviet era, and has supplemented them with new developments such as the Topol missile. Because of Russia's traditional strength in basic science, this country may be ahead of the US in certain key areas of military technology, although Russian engineering problems still hold this back. The Russian middle class has been bankrupted twice, once in the 1300% hyperinflation of 1992-93, and a second time in the banking panic associated with the Russian state default in August and September 1998. This fact alone is very ominous. The last time the middle class of a great power was subjected to two waves of bankruptcy was in Weimar Germany, when the middle class lost all its savings and investments through the combination of the hyperinflation of 1923, followed by the deflationary depression of 1929.

Under Yeltsin, Russia was the playground of a group of rapacious financiers who arrogantly called themselves the oligarchs -- these were figures like Berezvosky, Potanin, Smolensky, Friedman, and Khodorkhovsky. Khodorkhovsky seized control over most of the Siberian oil reserves, and appeared ready to sell them off to the Anglo-American oil cartel. The beginning of the end for the oligarchs came with the resignation of Yeltsin and the elevation of Putin to the Russian presidency on December 31, 1999. The KGB officer Putin tended to repress the oligarchs in conformity with the usual Russian statist model of political economy. Putin's arrival was punctuated by bombings of apartment houses in Moscow which were attributed to Moslem Chechen terrorists. This terror wave helped to consolidate Putin's power through the usual stampeding effect, but this may not be the whole story. The entire Chechen insurrection has been sponsored by the US and the British within the framework of what Brzezinski calls the "grand chessboard," and its leaders are reputed to be assets of the CIA. Perhaps the CIA and MI-6 had provided the terror wave upon which Putin  rode to power.

US AS WEIMAR GERMANY

One of the favorite theses of the neocons is that the United States today can be directly compared to the Weimar Republic, that is to say, to Germany between 1919 and 1933. Here the neocons are correct, although it must be added that one of the main factors contributing to the similarity is the role of the neocons themselves. Weimar was financially unstable, as seen in the hyperinflation of 1923 and the deflationary depression of 1929. It was also politically unstable, with right-wing coup attempts (like the Kapp- Luttwitz putsch of 1920 on the part of army officers and top bureaucrats, the Hitler- Ludendorff Munich beer hall putsch of November 1923) alternating with attempts at communist insurrection (the Bavarian Soviet republic and the German Communist Party's coup attempts). This kind of instability finds a precise analogue in the globalized United States starting at the end of the 1990s. We have had at least one coup or coup attempt per year, starting in 1998.

ONE COUP PER YEAR: USA, 1998-2004

On September 11, 1994, Frank Eugene Corder crashed his Cessna 150 L into the White House lawn two floors below Clinton's bedroom, killing himself in the process. Clinton was not there. The dead pilot had spoken of his hatred for Clinton. These events marked an attempt by the permanent Washington oligarchy -- the Establishment -- to break the will of Clinton, a person for whom many of the Washington establishment felt a wholly irrational but intense hatred. So the White House lawn was hit by a plane on September 11, 1994.

In the late summer of 1995, the Gingrich Republicans attempted permanently to weaken the constitutional powers of the presidency by unilaterally dictating the federal budget. This was an attempted coup by the GOP congressional leadership. They announced their willingness to deny spending authority to the Treasury in such a way as to provoke the default of the United States -- an unprecedented event which would have meant national bankruptcy and chaos. Clinton held firm as the government shut down, and the population turned against Gingrich, permanently weakening him. The Republicans were forced to back down, and the budget was enacted according to the relevant constitutional norms.

During 1998, the impeachment of Bill Clinton was prepared and carried out by a coalition of oligarchical reactionaries. The pre-history of this coup goes back to the beginning of the Clinton presidency, when stories about sexual excesses in the White House were circulated by disgruntled pro-Bush elements in the Secret Service. After 12 years of feeding at the public trough, the Bush faction and its allies experienced loss of power as a kind of traumatic cold turkey, and their response was an aggressive rage against Clinton, which fed on the relatively minor positive achievements of the new president. The impeachment coup was promoted by the reactionary millionaire Richard Mellon Scaife, and also by the Hollinger press empire of Conrad Black, with its flagship London Daily Telegraph and its star reported Ambrose Evans-Pritchard, a man known to be in contact with British intelligence. Another contributing group was the Barbara and Ted Olson salon in northern Virginia, which was attended by such reactionary gurus as Clarence Thomas, failed Supreme Court candidate Robert Bork, Lawrence Silberman of the DC circuit court of appeals, Robert Bartley of the Wall Street Journal, and others. The spearhead of impeachment in the House was Tom "the Hammer" Delay, a former pest exterminator. (See Tarpley in Hidell)

The scandal escalated in January 1998 as a result of Linda Tripp's illegal taping of her conversations with the pathetic Monica Lewinsky. Tripp had been encouraged by Lucienne Goldberg, a hardened Republican operative. Tripp was a GS-16 federal bureaucrat with a background in Army Intelligence. During the Iran-contra era, Tripp had served as personal secretary to General Richard Secord of the Army Delta Force; she had also been involved in one of the front companies on Oliver North's flow chart. When Tripp revealed the Clinton-Lewinsky story to GGP zealot special prosecutor Ken Starr, Starr redirected his probe from Whitewater to Monica, and the US presidency was paralyzed for two years.

The impeachment propaganda of the Republicans resonated deeply within the military, where the relatively new presence of female officers and enlisted personnel had led to a series of sexual abuse and sexual harassment scandals. Most famous of these was the 1991Tailhook affair, involving an orgy in which naval aviators and female officers participated, some under duress. Resentment grew over cases like that of Rear Admiral Ralph L. Tindal, who was ousted in December 1995 for sex harassment and adultery. Serving and retired military whose careers had been damaged or terminated by charges of sexual misconduct became enraged against Clinton, for whom they thought a double standard was being applied. Although such rage by itself might never add up to an attempted coup, it could help set the stage for one. Widespread hatred for President Kennedy in the CIA, its Cuban paramilitaries, and the US military after his failure to escalate the Bay of Pigs crisis and the Cuban missile crisis certainly helped to weaken the defenses of the presidency, and may have contributed something to the ease of recruitment of key officers to the plot and the above all to the cover-up.

In December 1998, with Clinton facing immediate impeachment by the House of Representatives, the principals' committee effectuated a minor coup within the White House bureaucracy. The visible expression of this was the bombing of Iraq just before Christmas under the code name of Operation Desert Fox. At the beginning of 1999, the attempted ouster of Clinton from the presidency was a coup that failed. Clinton's survival was the result of his continued strong public  support, expressed in part as unusual off-year gains for Democratic congressional candidates. Pro-impeachment oligarchs registered foaming rage and resentment not just against Clinton, but against the US population as a whole, which they claimed had not paid enough attention to the moral rectitude of the impeachers. Paul Weyrich of the Mellon-Scaife funded Free Congress Foundation talked of withdrawing from political affairs altogether, without making clear what the alternative field of endeavor might be. This incident tended to heighten the bureaucratic-authoritarian and totalitarian tendencies inside the reactionary wing of the US oligarchy, since it was evident that the population was not convinced by arguments which seemed self-evident to them. One may say that through these events the oligarchy was being educated in the need for a fascist transformation of some sort. Furthermore, there are unsubstantiated rumors that around this time US military circles, especially in the Navy, considered plans for a coup d'etat with the goal of ousting Clinton and replacing him with Ross Perot. These plans were reportedly abandoned when the other services declined to go along.

Nevertheless, a successful coup d'etat did take place in 1999. It involved the seizure of power by an organism known as the principals' committee, which was composed at that time of Vice President Gore and his dubious national security adviser Leon Fuerth, Defense Secretary William Cohen, Secretary of State Madeleine Albright, National Security Council director Samuel Berger, and Gen. Hugh Shelton, the chairman of the Joint Chiefs of Staff. George Tenet of the CIA was sometimes present, and the bureaucratic eminence grise of the committee was terror czar Richard Clarke, the star of the Kean-Hamilton commission in 2004. The pretext for ascendancy of the principals' committee was the fighting in the former Yugoslavia, which had begin in June 1990, when Yugoslavia had started to break up. After massacres of Moslems by Serbs at Srebrenica in July 1995, the US and NATO undertook a bombing campaign against the Bosnian Serb positions around besieged Sarajevo. These air strikes lasted from August 28 to September 13, 1995, with about 3400 missions flown. These air strikes had the merit of putting an end to the Yugoslav civil war, which had claimed the lives of 250,000 dead, and had seen numerous war crimes by Bosnian Serb leaders Karadjic and Mladic, and by others. Ex-Yugoslavia was finally pacified when all parties signed the Dayton accords on November 21, 1995 at Wright-Patterson Air Force Base. US and other NATO peacekeepers entered Bosnia in December. Then, in 1997, Albania, which neighbors Serbia and the province of Kosovo, which has an ethnic Albanian and Moslem majority, collapsed as a result of an orgy of financial speculation and Ponzi schemes. Weapons which had been the property of the Albanian government were pilfered, and found their way into the province of Kosovo, where they were used to arm the emerging Kosovo Liberation Army (KLA), a US- backed organization which relied on drug running for much of its financing. Clashes between the KLA and the Serbian military and police started in February-March 1998, and were soon seized upon by Madeleine Albright as a means of making an example of Serbia and of intimidating the world community in general, and in particular Russia, the traditional Orthodox backer of the Serbs. Fighting in Kosovo intensified during the summer of 1998. Responding to the threat of NATO air strikes, the Yugoslav leader Milosevic pulled most Serb units out of Kosovo.

But in the spring of 1999 the fighting flared up again. Now a crisis summit was convened at Rambouillet, near Paris. Here the KLA half-accepted the solution demanded by Albright, while the Serbs rejected it outright, since it included a clause giving US and NA TG forces the right to go anywhere and everywhere in Serbia, while seizing buildings and commandeering supplies. The Serbian national identity was based on a fierce commitment to independence, which had been expressed as guerrilla warfare against the Nazis, and then in successfully facing down Stalin at the height of his power. In response to the predictable Serb refusal, Albright became hysterical, feeling her entire secretaryship was in danger of collapse. She then sent Richard Holbrooke to Belgrade to give Milosevic an ultimatum: capitulate or face NATO bombing. Milosevic, realizing that giving up Kosovo and letting NATO forces into his country would mean his own political doom, rejected the US ultimatum. At this point Russian Prime Minister Yevgeni Primakov was en route to Washington, seeking to help mediate a negotiated solution for the crisis. There is good reason to believe that serious talks between the US and Primakov would have allowed a peaceful solution, since it was a Russian mediation that finally did bring a cessation of the bombing. But with Primakov over the Atlantic, Vice President Al Gore, acting on behalf of the principals' committee, insisted on giving the order to start the bombing. Seeing an affront, Primakov turned back and returned to Moscow. Now began 78 days of merciless bombing of Serbia, directed by General Wesley Clark, the NATO commander. Serbian civilian dead were estimated at 10,000 or more -at least three times the death toll of 9/11, all imposed as part of a proxy war designed to humiliate Russia and break the will of small countries who might want to resist the Anglo- American universal bullies.

APRIL 9, 1999: YELTSIN WARNS OF WORLD WAR

The bombing of Kosovo was a giant step towards the international anarchy that manifested itself during the Iraq war of 2003. Russia and China were opposed to the bombing, but their peace plan was vetoed by the US, Britain, and France. However, NATO bombed without the benefit of a UN security council resolution. US-Russian relations reached a post-1991 low, with militant demonstrations at the US embassy in Moscow every day. The bombing of Kosovo duplicated the cowardly "bomb now, die later" method pioneered in the first Iraq war of 1991, with civilian power stations, water systems, and sewage treatment plants all being targeted. The bridges over the Danube were destroyed, an act of despicable vandalism which paralyzed Europe's most important waterway.

As the bombing went on week after week without any Serb capitulation, NATO leaders were seized by the hysterical fear that if NATO's first war were to end in a draw, the now wholly artificial alliance would begin to collapse, The US needed NATO as a tool for out of area deployments, meaning attacks on developing countries. Tony Blair began proposing an invasion of Serbia with land forces, an option which Clinton had explicitly ruled out. Joining Blair in this insane proposal was General Wesley Clark. On April 9, 1999 Russian President Yeltsin predicted that an invasion of Serbia by land forces would lead to "European war for sure, and possibly a world war." Russian General Seleznyov reminded NATO that Russian nuclear missiles were still pointed towards the western powers. This was the first serious mention of world war by a major international figure during the 1990s. Not caring about Yeltsin ' s warnings, Blair attempted to use his visit to Washington for the NATO 50th anniversary on April 23 to convince Clinton to start the ground invasion, but he was rebuffed.

NATO tried to justify its bombing by citing the large numbers of Albanian refugees leaving Kosovo. There were also wild reports of Serb massacres of ethnic Albanians in Kosovo. Many of these exaggerations were conduited from US State Department spokesman Jamie Rubin to his wife, the meretricious CNN correspondent Christiana Amanpour. The US claimed that 100,000 Albanians had been massacred and placed in mass graves; postwar investigation showed that there were perhaps 3,000 -- a tragedy, but consistent with a guerrilla war of the type started by the KLA. The motivation for the bombing was therefore a big lie, manufactured by the US government and its media minions. ( www.antiwar.com/iustin/j082100.html )

How far was the aggressive clique within NATO prepared to go? According to Louis Sell, Milosevic was bludgeoned into capitulation by a threat by Finnish NATO spokesman Ahtisaari, who told the Serbs that "if he refused the deal, NATO was prepared to attack a much broader range of targets -including the remaining bridges across the Danube, the power and heating systems, and the telephone network." (Sell 311) This was a program of genocidal bombing with devastating delayed-action demographic impact - the "bomb now, die later" method employed in Iraq.

"I'M NOT GOING TG START WORLD WAR III FOR YOU"

Russia, now in the person of Chernomyrdin rather than ousted Primakov, was finally able to induce Milosevic to capitulate in early June. The Russian army, anxious to demonstrate solidarity with the Serbs, and resentful because of NATO attempts to deny Russia an occupation zone in Kosovo, on June 12 carried off a coup de main. They quickly shifted a couple of companies of armored vehicles to the airport in Pristina, a city in Kosovo not far from the border of Serbia proper. At this point General Wesley Clark (later Michael Moore's favorite presidential candidate in 2004) became frantic, and ordered the NATO ground commander, British General Sir Michael Jackson, to deny the Russians the use of the airport. There were reports that Russia was about to send a sky train of paratroopers to back up its demand. General Jackson flatly refused to carry out Clark's order, making the now-famous reply:

I'm not going to start the Third World War for you.

General Jackson later told the BBC: "We were [looking at] a possibility of confrontation with the Russian contingent which seemed to me probably not the right way to start off a relationship with Russians who were going to become part of my command." Clark planned to order British tanks and armored cars to block the runways to prevent any Russian transport planes from landing. Clark said he believed it was "an appropriate course of action." But the plan was again vetoed by Britain. Here was a second serious warning about world war. (BBC, March 9, 2000)

It is evident in retrospect that the Kosovo operation was a proxy war between the United States and Russia, in which the NATO mauling the Serb civilian population was supposed to illustrate to Russia the formidable military potential of the US-led alliance. The Pristina crisis cooled down, but US-Russian relations were dangerously strained. Milosevic had been indicted for war crimes in May 1999. As NATO troops streamed into defeated Serbia, they were accompanied by suitcases full of US dollars to be used by the National Endowment for Democracy to organize the overthrow of Milosevic, which duly followed in the spring of2000, when the dictator was toppled by a textbook CIA "people power" revolution. In mid-2001, a couple of months before 9/11, Milosevic was illegally kidnapped from Serbia and taken to stand trial at a kangaroo court in The Hague.

MAY 7, 1999: US BOMBS CHINESE EMBASSY

The Kosovo adventure ruined US relations with China as well. On May 7, a US stealth bomber destroyed the Chinese embassy in Belgrade, killing a number of Chinese. This incident may have disrupted a potential agreement that might have ended the bombing a month earlier than turned out. The Chinese leadership orchestrated a vehement anti-US campaign, with mass demonstrations everywhere. Albright's deputy James Pickering flew to Beijing on June 16 to deliver the official US apology and claim the attack was an accident, but this was brusquely rejected by the Chinese government. Matters were complicated by the arrest of US scientist Wen Ho Lee, who had been charged in March with spying for China. On May 25, 1999, the Cox Committee of the: US House of Representatives delivered an exaggerated and provocative report about Chinese espionage in the US. US-Chinese relations were now dangerously strained.

This was followed by what some journalists saw as a possible brush with actual thermonuclear war between the US and Russia. The occasion was the mysterious sinking of the newest and most powerful Russian nuclear submarine, the Kursk, in the Barents Sea during maneuvers on August 12, 2000. Russian officials reported that there had been a NATO submarine in the area when the Kursk was lost. NATO denied any involvement. The Kursk had been launched in 1994. During the Cold War and well into the 1990s, the Barents Sea had been the scene of dangerous underwater cat-and-mouse games between the US and Russia, with hunter-killer subs trailing ballistic missile subs on each side. US and Russian subs had last collided in the Arctic Ocean on March 20, 1993, when the USS Grayling crashed into a Russian Delta III class ballistic missile sub carrying 16 SS-N18 submarine launched ballistic missiles (SLBMs) about 105 miles north of the Soviet fleet base at Murmansk, during what was alleged by the US to be a routine patrol. At that time the Russian Defense Ministry had stated that the "high command of the Russian military fleet expresses its extreme concern over the latest incident of dangerous maneuvering by foreign submarines in military training zones."

THE KURSK: "WORLD WAR III COULD HAVE BEGUN SATURDAY"

While American and European media have jumped the gun in attributing the Kursk sinking to onboard explosions, probably caused by a battery fire or torpedo detonation, the preponderance of evidence in fact suggests that the Kursk collided with another vessel -- a U.S. or British submarine, or drone vehicle -or, in the extreme case, was possibly hit by a torpedo. A commission of Russian Navy officers officially endorsed the finding that the Kursk had been destroyed by a collision with a foreign sub. The Kursk, with a crew of 118 sailors and officers, was found at the bottom of the Sea. The crew members were instantly killed in what Russian officials asserted was a collision with the second vessel. On August 21, the Russian news agency Interfax reported that Russian rescue workers had found a fragment of a submarine, "most likely British," near the Kursk. This followed earlier reports that emergency buoys, also identified as British, were seen floating near the collision site.

On August 22, 2000, Pravda.ru ran a story on the Kursk disaster under the headline: "World War III Could Have Begun on Saturday." According to this piece, "On Saturday, August 12, an incident occurred in the Barents Sea, where the Russian Federation's Northern Fleet was conducting exercises, which nearly led to the outbreak of full-scale combat--a third world war For several days the world hung by a thread, and one false political move could have led to an exchange of nuclear strikes." Citing hydroacoustical evidence of three explosions, "indicating the possibility that the Kursk had suffered a torpedo attack." Pravda.ru described the incident as a possible casus belli, but concluded, "Happily, the incident in the Barents Sea was successfully resolved by political means. Agreement to 'end the affair in peace' was reached during a telephone conversation between Vladimir Putin and Bill Clinton. The Presidents' conversation lasted 25 minutes, and nothing of its content was reported in the mass media." (New Federalist, August 28, 2000)

On August 22, John Helmer, a Moscow-based journalist who wrote for the Journal of Commerce and the Moscow Times, commented in the Singapore-based Straits Times that "the Russian sub drama looked like war at the start." Dismissing the hysterical Western media criticism of President Putin, who remained at the "vacation Kremlin" at Sochi, Helmer wrote, "If you were the ruler of Russia, and you were told late one night that one of your most powerful and secret submarine weapons had been hit bya mysterious explosion, and sent to the bottom without word from the crew, would it be prudent for you to suspect an attack? An attack by a nuclear superpower and old rival? And if it is your sworn duty to defend your country from attack, would it be reasonable for you to determine whether there was a cause for war, or an accident?" Also noteworthy was Putin's growing convergence with the former Prime Minister Yevgeni Primakov, an advocate of a Eurasian perspective for Russia, who on August 23 delivered a strongly worded statement warning the West and the Russian oligarchs not to try to exploit the near-war crisis. (EIR, September 1, 2000)

The US claimed that an anti-submarine rocket fired from the Kursk had gotten jammed in a firing tube, causing the deadly explosion. But Russian authorities insisted that a foreign sub of the same general type as the Kursk had been present. As the US media were concerned, the Kursk crisis calmed down after a surprise visit to Moscow by CIA Director Tenet, but tensions between the two powers remained extreme. This is the immediate background to Vladimir Putin's telephone call to Bush on the morning of September 11, 2001.

THE NEOCONS ANTAGONIZE CHINA

The great neocon project of the late 1990s was that of a US confrontation with China. Huntington's Clash of Civilizations crisis cookbook had identified two challengers to Anglo-American world domination: the Moslems, because of their population growth, and China, because of its economic growth. Neocon thinking oscillates between these two as the more immediate threat. After the Taiwan straits confrontation of 1996, the bombing of the Chinese Embassy in Belgrade in May 1999, the Wen Ho Lee case, the Cox report on alleged Chinese espionage, and the Chinagate accusations of Beijing funding for Clinton, US-Chinese relations were at a low ebb. As former US Ambassador to Beijing James Lilley pointed out, ":...there has been a dramatic change that is pervasive and, at times, ugly. After the Belgrade bombing accident in May of 1999, we saw the full face of anger, hostility, and even hate on the faces of the Chinese attacking our embassy." Lilley went on in a threatening tone: "If China continues to expand its military parameters, it will encounter our power. China can avoid this confrontation by buying into economic globalization, and lowering nationalistic tensions. To do otherwise is to risk tearing down the who le structure." (Newsweek, April 16, 2001)

The good will expressed towards the US by the Chinese students in Tien An Men Square in 1989 had completely dissipated, and was replaced by loathing -- well before 9/11 and Iraq. Something similar had happened in Russia and elsewhere -- also before 9/11.

Bush's first months in office were dominated by an incident involving the mid-air collision between a US EP-3E Aries II spy plane and a Chinese F-8 fighter jet just off the coast of China near the main base of the Chinese South Sea Fleet in Zhangjiang.. Here US planes on electronic surveillance missions had long been regularly buzzed and harassed by Chinese interceptors. During one such encounter the Chinese fighter collided with the larger and slower US plane; the Chinese jet crashed and the pilot was lost, while the US plane had to make an emergency landing at a Chinese airport on Hainan Island. The plane and its crew of 19 were detained for a couple of weeks before being returned to the US. The Chinese demanded a formal apology, which the pugnacious Bush administration was reluctant to make. The Chinese press ran pictures of the downed US spy plane with headlines reading "Proof of Bullying," and contemptuous attacks on "Little Bush." Chinese internet chatrooms buzzed with talk of imminent war; "Are you ready? This is war," said one posting. The neocon Weekly Standard headlined its story about the Hainan incident " A National Humiliation," and authors William Kristol and Robert Kagan, both prominent chickenhawk warmongers, accused the newly installed Bush 43 of "weakness" in handling the affair. The neocons were disturbed by Colin Powell's reliance on diplomacy to get back the plane and crew for the US, and especially by the attitude of the US business community, which was more interested in profitable deals than in seconding the neocons' distorted view of national honor. (Newsweek April 16, 2001) The whole experience was an object lesson to the neocon clique and the military provocateurs. For eight years they had writhed in bitterness because of Clinton's sane reluctance to resort to military force. Now, after the tremendous effort required to put Bush into the White House, the result was not much more satisfactory. We can safely assume that neocons and provocateurs drew the obvious lessons: that they must begin thinking along more grandiose lines, and planning for an outside event several orders of magnitude greater than any attempted thus far.

Tensions increased elsewhere as well. During the 1990s, Moscow and Beijing were repeatedly and pointedly reminded of the presence of an aggressive faction inside the US government and military which was intent on provoking periodic incidents to exacerbate tensions among the major powers. From Kosovo to Belgrade, from the Barents Sea to the South China Sea, from Iraq to Somalia, this aggressive faction had provoked clashes, manufactured pretexts for intervention, and fought a proxy war near the heart of Europe. The 1990s were anything but idyllic; they were a period of escalating economic and strategic crisis. The sympathetic interest in US life seen in 1989-1991 in Russia and China had by mid-2001 been replaced by overwhelming hostility. At the same time, the aggressive and adventurous network inside the US government was deeply dissatisfied with their own failure to achieve decisive results. Every passing year brought population increases throughout the Moslem world, and 10-15% economic growth rates to China, while the US real economy (apart from Wall Street's paper swindles) continued to stagnate. Like the British contemplating German economic growth in 1905-1907, the US war faction concluded that a long period of world peace could only result in the further relative decline of the US. To create the political preconditions for what they wanted to do, the US war party therefore began to feel an overwhelming need to become the party of synthetic terror.

The groundwork for the aggressive and terror-based consensus at the end of the 1990s had been laid starting in March 1992, when Paul D. Wolfowitz, then the Pentagon's Under Secretary for Policy submitted his long-term Defense Planning Guidance to then Secretary of Defense Dick Cheney. As the press wrote at that time, the Pentagon policy paper asserted "that America's political and military mission in the post-cold-war era will be to insure that no rival superpower is allowed to emerge in Western Europe, Asia or the territory of the former Soviet Union." The role of the UN would dwindle to insignificance, the paper indicated, and US unilateral action would dominate the world. Wolfowitz's plan also stressed "using military force, if necessary, to prevent the proliferation of nuclear weapons and other weapons of mass destruction in such countries as North Korea, Iraq, some of the successor republics to the Soviet Union and in Europe." Direct nuclear blackmail of Russia was also prominent; the Wolfowitz document underlined that American strategic nuclear weapons would continue to target vital aspects of the former Soviet military establishment. The rationale for this targeting policy was that the United States "must continue to hold at risk those assets and capabilities that current -- and future -- Russian leaders or other nuclear adversaries value most" because Russia would remain "the only power in the world with the capability of destroying the United States." The essence of US policy was seen in intimidation, "convincing potential competitions that they need not aspire to a greater role," thus guaranteeing that no rival superpower would be allowed to emerge. (The New York Times, March 8, 1992)

Richard Perle later elaborated an aggressive strategy for Israeli politician Beniamin Netanyahu known as the "Clean Break" policy, which was based on rejecting a negotiated peace with Arabs and Palestinians in favor of endless war. Brzezinski's 1997 Grand Chessboard touted the benefits of US meddling central Asia for geopolitical reasons; this study was similar in spirit to the Karl Haushofer's 1934 Weltpolitik von heute, the manual of Nazi geopolitics. But how to manipulate the American people into accepting the burdens and human losses associated with such meddling? Brzezinski, a petty Polish aristocrat, replied: "The attitude of the American public toward the external projection of American power has been much more ambivalent. The public supported America's engagement in World War II largely because of the shock effect of the Japanese attack on Pearl Harbor." (Brzezinski 24-25)

An even more explicit call for US world domination came from the Project for a New American Century, a neocon movement that provided most of the top officials for the Bush 43 administration. After discussing their imperialist plans, the PNAC authors, led by chickenhawk William Kristol, focused on the way of duping the American people into supporting the raft of new foreign adventures: "... the process of transformation is likely to be a long one, absent some catastrophic and catalyzing event -- like a new Pearl Harbor." (PNAC, September 2000) It is in this restless mood, desirous of a new global conflict to pre-empt the emergence of challengers to a new Anglo-American world order, viewing the democratic system as unresponsive to their elitist warmongering, and eager for the assistance that a spectacular external attack would bring, that the roots of 9/11 are to be sought.

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Notes:

2. US National Security Council, "Implications of Worldwide Population Growth for US Security and  Overseas Interests," National Security Study Memorandum 200, December 10, 1974. This document posited a "special US political and strategic interest" in population reduction or limitation in many developing sector nations because of potential competition with the US for access to natural resources and raw materials. This amounted to a strategy of thinly veiled genocide, and facilitated US support for the murderous Pol Pot regime in Cambodia.

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