It's becoming increasingly clear that 2008 will be a catastrophic year for the US economy, and therefore probably for that of the world as a whole. The reasons boil down to two: continuing and snowballing fallout from the subprime mortgage fiasco (exacerbated by an orgy of debt-leveraging), and record-high, continuously advancing oil prices.

But will the impact be inflationary or deflationary? This matters, because the diagnosis determines how governments and financial institutions should respond, and what private citizens should do to protect themselves.

Part of the answer depends on how one defines the terms.

Some economists are in the habit of defining inflation simply as rising wages and prices. From this standpoint, high oil prices (caused by depletion and scarcity) are inflationary.

Others define inflation as an increase in the money supply. Some would take that a step further by defining inflation as growth in the money supply that outpaces growth in the productive economy.

In the current instance, Peak Oil is occurring at the same time as the bursting of the real estate bubble, in which a rapid decline in the value of property is effectively causing money and credit to evaporate from the economy. This is being called a liquidity crisis, but for financial institutions it actually amounts to a solvency crisis, and will likely result in the collapse of several major banks. From a monetarist point of view, that's deflationary.

The remedy? The Federal Reserve is lowering interest rates (to expand credit) and the government itself is considering an "economic stimulus" package, which will evidently consist at least partly of a direct tax rebate - checks in the mail to tens of millions of citizens. Some have likened this to dropping new money out of helicopters, and are calling Fed Chairman Ben Bernanke "Helicopter Ben." Helicoptering in new money is inflationary. It will cause a decline in the value of the dollar (in deflationary times - like the 1930s in the US - currencies typically hold or even gain in value because there is not much money to go around).

The US dollar is in fact losing value - a sure sign of inflation.

So here again is the dilemma: given these factors in play, how does one know what's in store for the economy? What does one call the emerging condition?

It may be enough just to call it a "depression." Even mainstream publications are now using the "D" word, at least conditionally. But most depressions are deflationary, and there is the nagging problem of high energy prices that are now beginning to filter down through the economy, skewing food prices up as well; and there's that declining currency value as well. Aren't those symptoms of inflation?

As oil becomes more costly, a greater and greater percentage of societal resources will be going to energy and food production, draining other sectors. This is in fact inherently deflationary (even though the price hikes may be interpreted as inflation), because the proportion of societal resources going to support consumption (infrastructure, wages, and credit) will inevitably have to decrease. Jobs in most sectors will vanish.

Yet as the crisis unfolds, there is every reason to think there could be periods of hyperinflation - though only in certain sectors of the economy. We are seeing evidence of every desire, on the part of the Fed and the government, to increase the money supply and thereby forestall the credit crunch ensuing from the subprime mortgage disaster. But where, exactly, should they inject that money? There really aren't many options. Through more government debt? That's a foregone conclusion. By propping up banks - that will nevertheless be in no position to pass on that money by making new loans? There may be other ways as well, but they will all show up as symptoms of inflation or hyperinflation. They will all also result in the destruction of the efficacy of the currency itself.

In other words, as this mess unfolds we may see extreme symptoms of inflation alongside those of deflation.

For an economy, this is the worst of all possible worlds. We have never seen anything quite like it. Maybe it's a "Perfect Storm" economy.

Fortunately, there is at least one upside to all these downers: the collapse of the current debt-and-growth based economy may finally force a redesign of the money system and the "science" of economics. But this will take a while, and it will help if there are good ideas out there being widely discussed and promoted, such as the notions of a steady-state economy or an energy-backed currency.

Meanwhile, if you're interested in finding shelter during the storm, get thee to the productive side of the economy. Grow something, or learn to make or repair something useful.

Michael Meacher

Our only hope lies in forging a new energy world order

Although the price for July deliveries of Brent crude is over $70 a barrel, Lord Browne, BP's chief executive, thinks prices will halve in the medium term. According to a recent interview, he believes large oilfields are still being found and Canada's oil sands could be exploited.

Some hope. Already four-fifths of the world's oil supply comes from fields discovered before 1970 and even finding a field as large as Ghawar in Saudi Arabia, the world's largest, would only meet global demand for another 10 years.

Peak oil is the point at which oil production rises to its highest point before declining. Almost all expert opinion agrees that it is fast approaching, possibly within five years, almost certainly within 15, according to the former Saudi oil chief, Dr Sadad al-Husseini.

Whilst it has taken 145 years to consume half of the 2-2½ trillion barrels of conventional oil supplies generally regarded as the total available, it is likely that, given the huge increases in demand from China and India, with rates of growth of 7pc-10pc a year in economies supplying two-fifths of the world population, the other half will be largely consumed within the next 40 years.

The significance of this can hardly be over-stated. Oil is the fundamental underpinning of our civilization.

Alternatives like biofuels, ethanol or biomass can play a marginal supportive role but nowhere near on the scale required. When the oil runs out the economic and social dislocation will be unprecedented.

But isn't this too pessimistic? Won't new discoveries continue to fill the gap?

The pattern of the past few decades argues very strongly against it. Some 98pc of global crude oil comes from 45 nations, of which more than half may have peaked in oil production, including seven of the 11 Opec nations.

Major oil field discoveries fell to zero for the first time in 2003. Worse still, the excess capacity held by Opec nations has dwindled, from an average of 30pc to about 1pc of global demand now.

The political significance of this is almost incalculable. World oil and gas production is declining at an average of 4pc-6pc a year, while demand is growing at 2pc-3pc a year.

Global oil production is 84m barrels a day. As the president of Exxon Mobil Exploration, John Thompson, said in 2003: "By 2015 we will need to find, develop and produce a volume of new oil and gas that is equal to eight out of every 10 barrels being produced today." That is not just a problem of better technology. Additional oil on that scale is not available.

There are three options to escape this dilemma. One, which the US is ruthlessly pursuing, is to grab by force of arms the lion's share of what remains.

A second is to shift into unconventional sources of oil - tar sands, extra heavy oils and gas to liquids processing. A third is to accelerate the switch out of oil altogether into renewable sources of energy, especially wind power, biomass, tidal power and solar.

What is so disturbing is that long-term global policymaking on this, perhaps the biggest decision this century, is virtually non-existent and driven instead by self-destructive short-termism.

The first option was the real reason behind the first Gulf War in 1991, to deter Saddam gaining control of the Saudi oilfields.

It was also a major reason for the orchestrated revolutions in Ukraine, Georgia and Kyrgyzstan, as well as the military interventions in Afghanistan and Yugoslavia, all of which offer key oil transit routes from the Caspian Sea Basin, which holds the world's biggest untapped fossil fuel resources, worth up to $5 trillion.

Equally it is also one major reason for Russian intervention in Chechnya, part of the northerly transit route between the Caspian and Black Sea under current Russian control. It is certainly another reason for US concern about Iran, holding only slightly lower oil reserves than Iraq.

But, above all, option one was the main trigger for the Iraq war. Of more than 80 oilfields discovered in Iraq, only about 21 have been at least partly developed.

Despite this, Iraq's proven oil reserves exceed 110bn barrels but its total reserves are likely to be far more, perhaps even 200bn barrels more.

This explains US determination to control this fulcrum but it has involved an escalating political, military and economic price that must make this option unsupportable even for the US.

An alternative strategy is to take advantage of the rising oil price to develop unconventional oil sources, notably the Athabascan tar sands in Canada and the Venezuelan Orinoco heavy oils.

However, the downsides in terms of cost, manpower, water shortages and, above all, CO2, are prohibitive.

Cost-wise, the International Energy Agency reckons that investment needed in oil and gas over the next 25 years to meet an expected 50pc increase in global demand, will be $5 trillion, equivalent to more than four times the entire GNP of the UK.

The biggest constraint, however, is environmental. It takes almost as much energy to mine, process, refine and upgrade the oil extracted from tar sand as the energy contained in the light oil produced.

Worse still, the processing releases five to 10 times more greenhouse gases than a barrel of conventional oil. This is the exact opposite to the scientists' requirement for the world to cut greenhouse gas emissions by at least 60pc by 2050.

The third option is clearly the right way forward - a new energy world order. The potential for powering the world economy via renewables is almost infinite. Governments should now be switching to this option, far faster and on a far greater scale.

A Brief History of U.S. Interventions - 1945 to 1999 By William Blum 1999 - "ZMag" -- -The engine of American foreign policy has been fueled not by a devotion to any kind of morality, but rather by the necessity to serve other imperatives, which can be summarized as follows: * making the world safe for American corporations; * enhancing the financial statements of defense contractors at home who have contributed generously to members of congress; * preventing the rise of any society that might serve as a successful example of an alternative to the capitalist model; * extending political and economic hegemony over as wide an area as possible, as befits a "great power." This in the name of fighting a supposed moral crusade against what cold warriors convinced themselves, and the American people, was the existence of an evil International Communist Conspiracy, which in fact never existed, evil or not. The United States carried out extremely serious interventions into more than 70 nations in this period.
China, 1945-49: Intervened in a civil war, taking the side of Chiang Kai-shek against the Communists, even though the latter had been a much closer ally of the United States in the world war. The U.S. used defeated Japanese soldiers to fight for its side. The Communists forced Chiang to flee to Taiwan in 1949.
Italy, 1947-48: Using every trick in the book, the U.S. interfered in the elections to prevent the Communist Party from coming to power legally and fairly. This perversion of democracy was done in the name of "saving democracy" in Italy. The Communists lost. For the next few decades, the CIA, along with American corporations, continued to intervene in Italian elections, pouring in hundreds of millions of dollars and much psychological warfare to block the specter that was haunting Europe.
Greece, 1947-49: Intervened in a civil war, taking the side of the neo-fascists against the Greek left which had fought the Nazis courageously. The neo-fascists won and instituted a highly brutal regime, for which the CIA created a new internal security agency, KYP. Before long, KYP was carrying out all the endearing practices of secret police everywhere, including systematic torture.
Philippines, 1945-53: U.S. military fought against leftist forces (Huks) even while the Huks were still fighting against the Japanese invaders. After the war, the U. S. continued its fight against the Huks, defeating them, and then installing a series of puppets as president, culminating in the dictatorship of Ferdinand Marcos.
South Korea, 1945-53: After World War II, the United States suppressed the popular progressive forces in favor of the conservatives who had collaborated with the Japanese. This led to a long era of corrupt, reactionary, and brutal governments.
Albania, 1949-53: The U.S. and Britain tried unsuccessfully to overthrow the communist government and install a new one that would have been pro-Western and composed largely of monarchists and collaborators with Italian fascists and Nazis.
Germany, 1950s: The CIA orchestrated a wide-ranging campaign of sabotage, terrorism, dirty tricks, and psychological warfare against East Germany. This was one of the factors which led to the building of the Berlin Wall in 1961.
Iran, 1953: Prime Minister Mossadegh was overthrown in a joint U.S./British operation. Mossadegh had been elected to his position by a large majority of parliament, but he had made the fateful mistake of spearheading the movement to nationalize a British-owned oil company, the sole oil company operating in Iran. The coup restored the Shah to absolute power and began a period of 25 years of repression and torture, with the oil industry being restored to foreign ownership, as follows: Britain and the U.S., each 40 percent, other nations 20 percent.
Guatemala, 1953-1990s: A CIA-organized coup overthrew the democratically-elected and progressive government of Jacobo Arbenz, initiating 40 years of death-squads, torture, disappearances, mass executions, and unimaginable cruelty, totaling well over 100,000 victims -indisputably one of the most inhuman chapters of the 20th century. Arbenz had nationalized the U.S. firm, United Fruit Company, which had extremely close ties to the American power elite. As justification for the coup, Washington declared that Guatemala had been on the verge of a Soviet takeover, when in fact the Russians had so little interest in the country that it didn't even maintain diplomatic relations. The real problem in the eyes of Washington, in addition to United Fruit, was the danger of Guatemala's social democracy spreading to other countries in Latin America.
Middle East, 1956-58: The Eisenhower Doctrine stated that the United States "is prepared to use armed forces to assist" any Middle East country "requesting assistance against armed aggression from any country controlled by international communism." The English translation of this was that no one would be allowed to dominate, or have excessive influence over, the middle east and its oil fields except the United States, and that anyone who tried would be, by definition, "Communist." In keeping with this policy, the United States twice attempted to overthrow the Syrian government, staged several shows-of-force in the Mediterranean to intimidate movements opposed to U.S.-supported governments in Jordan and Lebanon, landed 14,000 troops in Lebanon, and conspired to overthrow or assassinate Nasser of Egypt and his troublesome middle-east nationalism.
Indonesia, 1957-58: Sukarno, like Nasser, was the kind of Third World leader the United States could not abide. He took neutralism in the cold war seriously, making trips to the Soviet Union and China (though to the White House as well). He nationalized many private holdings of the Dutch, the former colonial power. He refused to crack down on the Indonesian Communist Party, which was walking the legal, peaceful road and making impressive gains electorally. Such policies could easily give other Third World leaders "wrong ideas." The CIA began throwing money into the elections, plotted Sukarno's assassination, tried to blackmail him with a phony sex film, and joined forces with dissident military officers to wage a full-scale war against the government. Sukarno survived it all.
British Guiana/Guyana, 1953-64: For 11 years, two of the oldest democracies in the world, Great Britain and the United States, went to great lengths to prevent a democratically elected leader from occupying his office. Cheddi Jagan was another Third World leader who tried to remain neutral and independent. He was elected three times. Although a leftist-more so than Sukarno or Arbenz-his policies in office were not revolutionary. But he was still a marked man, for he represented Washington's greatest fear: building a society that might be a successful example of an alternative to the capitalist model. Using a wide variety of tactics-from general strikes and disinformation to terrorism and British legalisms, the U. S. and Britain finally forced Jagan out in 1964. John F. Kennedy had given a direct order for his ouster, as, presumably, had Eisenhower. One of the better-off countries in the region under Jagan, Guyana, by the 1980s, was one of the poorest. Its principal export became people.
Vietnam, 1950-73: The slippery slope began with siding with ~ French, the former colonizers and collaborators with the Japanese, against Ho Chi Minh and his followers who had worked closely with the Allied war effort and admired all things American. Ho Chi Minh was, after all, some kind of Communist. He had written numerous letters to President Truman and the State Department asking for America's help in winning Vietnamese independence from the French and finding a peaceful solution for his country. All his entreaties were ignored. Ho Chi Minh modeled the new Vietnamese declaration of independence on the American, beginning it with "All men are created equal. They are endowed by their Creator with ..." But this would count for nothing in Washington. Ho Chi Minh was some kind of Communist. Twenty-three years and more than a million dead, later, the United States withdrew its military forces from Vietnam. Most people say that the U.S. lost the war. But by destroying Vietnam to its core, and poisoning the earth and the gene pool for generations, Washington had achieved its main purpose: preventing what might have been the rise of a good development option for Asia. Ho Chi Minh was, after all, some kind of communist.
Cambodia, 1955-73: Prince Sihanouk was yet another leader who did not fancy being an American client. After many years of hostility towards his regime, including assassination plots and the infamous Nixon/Kissinger secret "carpet bombings" of 1969-70, Washington finally overthrew Sihanouk in a coup in 1970. This was all that was needed to impel Pol Pot and his Khmer Rouge forces to enter the fray. Five years later, they took power. But five years of American bombing had caused Cambodia's traditional economy to vanish. The old Cambodia had been destroyed forever. Incredibly, the Khmer Rouge were to inflict even greater misery on this unhappy land. To add to the irony, the United States supported Pol Pot, militarily and diplomatically, after their subsequent defeat by the Vietnamese.
The Congo/Zaire, 1960-65: In June 1960, Patrice Lumumba became the Congo's first prime minister after independence from Belgium. But Belgium retained its vast mineral wealth in Katanga province, prominent Eisenhower administration officials had financial ties to the same wealth, and Lumumba, at Independence Day ceremonies before a host of foreign dignitaries, called for the nation's economic as well as its political liberation, and recounted a list of injustices against the natives by the white owners of the country. The man was obviously a "Communist." The poor man was obviously doomed. Eleven days later, Katanga province seceded, in September, Lumumba was dismissed by the president at the instigation of the United States, and in January 1961 he was assassinated at the express request of Dwight Eisenhower. There followed several years of civil conflict and chaos and the rise to power of Mobutu Sese Seko, a man not a stranger to the CIA. Mobutu went on to rule the country for more than 30 years, with a level of corruption and cruelty that shocked even his CIA handlers. The Zairian people lived in abject poverty despite the plentiful natural wealth, while Mobutu became a multibillionaire.
Brazil, 1961-64: President Joao Goulart was guilty of the usual crimes: He took an independent stand in foreign policy, resuming relations with socialist countries and opposing sanctions against Cuba; his administration passed a law limiting the amount of profits multinationals could transmit outside the country; a subsidiary of ITT was nationalized; he promoted economic and social reforms. And Attorney-General Robert Kennedy was uneasy about Goulart allowing "communists" to hold positions in government agencies. Yet the man was no radical. He was a millionaire land-owner and a Catholic who wore a medal of the Virgin around his neck. That, however, was not enough to save him. In 1964, he was overthrown in a military coup which had deep, covert American involvement. The official Washington line was...yes, it's unfortunate that democracy has been overthrown in Brazil...but, still, the country has been saved from communism. For the next 15 years, all the features of military dictatorship that Latin America has come to know were instituted: Congress was shut down, political opposition was reduced to virtual extinction, habeas corpus for "political crimes" was suspended, criticism of the president was forbidden by law, labor unions were taken over by government interveners, mounting protests were met by police and military firing into crowds, peasants' homes were burned down, priests were brutalized...disappearances, death squads, a remarkable degree and depravity of torture...the government had a name for its program: the "moral rehabilitation" of Brazil. Washington was very pleased. Brazil broke relations with Cuba and became one of the United States' most reliable allies in Latin America.
Dominican Republic, 1963-66: In February 1963, Juan Bosch took office as the first democratically elected president of the Dominican Republic since 1924. Here at last was John F. Kennedy's liberal anti-Communist, to counter the charge that the U.S. supported only military dictatorships. Bosch's government was to be the long sought " showcase of democracy " that would put the lie to Fidel Castro. He was given the grand treatment in Washington shortly before he took office. Bosch was true to his beliefs. He called for land reform, low-rent housing, modest nationalization of business, and foreign investment provided it was not excessively exploitative of the country and other policies making up the program of any liberal Third World leader serious about social change. He was likewise serious about civil liberties: Communists, or those labeled as such, were not to be persecuted unless they actually violated the law. A number of American officials and congresspeople expressed their discomfort with Bosch's plans, as well as his stance of independence from the United States. Land reform and nationalization are always touchy issues in Washington, the stuff that "creeping socialism" is made of. In several quarters of the U.S. press Bosch was red-baited. In September, the military boots marched. Bosch was out. The United States, which could discourage a military coup in Latin America with a frown, did nothing. Nineteen months later, a revolt broke out which promised to put the exiled Bosch back into power. The United States sent 23,000 troops to help crush it.
Cuba, 1959 to present: Fidel Castro came to power at the beginning of 1959. A U.S. National Security Council meeting of March 10, 1959 included on its agenda the feasibility of bringing "another government to power in Cuba." There followed 40 years of terrorist attacks, bombings, full-scale military invasion, sanctions, embargoes, isolation, assassinations...Cuba had carried out The Unforgivable Revolution, a very serious threat of setting a "good example" in Latin America. The saddest part of this is that the world will never know what kind of society Cuba could have produced if left alone, if not constantly under the gun and the threat of invasion, if allowed to relax its control at home. The idealism, the vision, the talent were all there. But we'll never know. And that of course was the idea.
Indonesia, 1965: A complex series of events, involving a supposed coup attempt, a counter-coup, and perhaps a counter-counter-coup, with American fingerprints apparent at various points, resulted in the ouster from power of Sukarno and his replacement by a military coup led by General Suharto. The massacre that began immediately-of Communists, Communist sympathizers, suspected Communists, suspected Communist sympathizers, and none of the above-was called by the New York Times "one of the most savage mass slayings of modern political history." The estimates of the number killed in the course of a few years begin at half a million and go above a million. It was later learned that the U.S. embassy had compiled lists of& quot;Communist" operatives, from top echelons down to village cadres, as many as 5,000 names, and turned them over to the army, which then hunted those persons down and killed them. The Americans would then check off the names of those who had been killed or captured. "It really was a big help to the army. They probably killed a lot of people, and I probably have a lot of blood on my hands," said one U.S. diplomat. "But that's not all bad. There's a time when you have to strike hard at a decisive moment. "
Chile, 1964-73: Salvador Allende was the worst possible scenario for a Washington imperialist. He could imagine only one thing worse than a Marxist in power-an elected Marxist in power, who honored the constitution, and became increasingly popular. This shook the very foundation stones on which the anti-Communist tower was built: the doctrine, painstakingly cultivated for decades, that "communists" can take power only through force and deception, that they can retain that power only through terrorizing and brainwashing the population. After sabotaging Allende's electoral endeavor in 1964, and failing to do so in 1970, despite their best efforts, the CIA and the rest of the American foreign policy machine left no stone unturned in their attempt to destabilize the Allende government over the next three years, paying particular attention to building up military hostility. Finally, in September 1973, the military overthrew the government, Allende dying in the process. They closed the country to the outside world for a week, while the tanks rolled and the soldiers broke down doors; the stadiums rang with the sounds of execution and the bodies piled up along the streets and floated in the river; the torture centers opened for business; the subversive books were thrown into bonfires; soldiers slit the trouser legs of women, shouting that "In Chile women wear dresses!"; the poor returned to their natural state; and the men of the world in Washington and in the halls of international finance opened up their check- books. In the end, more than 3,000 had been executed, thousands more tortured or disappeared.
Greece, 1964-74: The military coup took place in April 1967, just two days before the campaign for j national elections was to begin, elections which appeared certain to bring the veteran liberal leader George Papandreou back as prime minister. Papandreou had been elected in February 1964 with the only outright majority in the history of modern Greek elections. The successful machinations to unseat him had begun immediately, a joint effort of the Royal Court, the Greek military, and the American military and CIA stationed in Greece. The 1967 coup was followed immediately by the traditional martial law, censorship, arrests, beatings, torture, and killings, the victims totaling some 8,000 in the first month. This was accompanied by the equally traditional declaration that this was all being done to save the nation from a "Communist takeover." Corrupting and subversive influences in Greek life were to be removed. Among these were miniskirts, long hair, and foreign newspapers; church attendance for the young would be compulsory. It was torture, however, which most indelibly marked the seven-year Greek nightmare. James Becket, an American attorney sent to Greece by Amnesty International, wrote in December 1969 that "a conservative estimate would place at not less than two thousand" the number of people tortured, usually in the most gruesome of ways, often with equipment supplied by the United States. Becket reported the following: Hundreds of prisoners have listened to the little speech given by Inspector Basil Lambrou, who sits behind his desk which displays the red, white, and blue clasped-hand symbol of American aid. He tries to show the prisoner the absolute futility of resistance: "You make yourself ridiculous by thinking you can do anything. The world is divided in two. There are the communists on that side and on this side the free world. The Russians and the Americans, no one else. What are we? Americans. Behind me there is the government, behind the government is NATO, behind NATO is the U.S. You can't fight us, we are Americans." George Papandreou was not any kind of radical. He was a liberal anti-Communist type. But his son Andreas, the heir-apparent, while only a little to the left of his father had not disguised his wish to take Greece out of the Cold War, and had questioned remaining in NATO, or at least as a satellite of the United States.
East Timor, 1975 to present: In December 1975, Indonesia invaded East Timor, which lies at the eastern end of the Indonesian archipelago, and which had proclaimed its independence after Portugal had relinquished control of it. The invasion was launched the day after U. S. President Gerald Ford and Secretary of State Henry Kissinger had left Indonesia after giving Suharto permission to use American arms, which, under U.S. Iaw, could not be used for aggression. Indonesia was Washington's most valuable tool in Southeast Asia. Amnesty International estimated that by 1989, Indonesian troops, with the aim of forcibly annexing East Timor, had killed 200,000 people out of a population of between 600,000 and 700,000. The United States consistently supported Indonesia's claim to East Timor (unlike the UN and the EU), and downplayed the slaughter to a remarkable degree, at the same time supplying Indonesia with all the military hardware and training it needed to carry out the job.
Nicaragua, 1978-89: When the Sandinistas overthrew the Somoza dictatorship in 1978, it was clear to Washington that they might well be that long-dreaded beast-"another Cuba." Under President Carter, attempts to sabotage the revolution took diplomatic and economic forms. Under Reagan, violence was the method of choice. For eight terribly long years, the people of Nicaragua were under attack by Washington's proxy army, the Contras, formed from Somoza's vicious National Guard and other supporters of the dictator. It was all-out war, aiming to destroy the progressive social and economic programs of the government, burning down schools and medical clinics, raping, torturing, mining harbors, bombing and strafing. These were Ronald Reagan's "freedom fighters." There would be no revolution in Nicaragua.
Grenada, 1979-84: What would drive the most powerful nation in the world to invade a country of 110,000? Maurice Bishop and his followers had taken power in a 1979 coup, and though their actual policies were not as revolutionary as Castro's, Washington was again driven by its fear of "another Cuba," particularly when public appearances by the Grenadian leaders in other countries of the region met with great enthusiasm. U. S. destabilization tactics against the Bishop government began soon after the coup and continued until 1983, featuring numerous acts of disinformation and dirty tricks. The American invasion in October 1983 met minimal resistance, although the U.S. suffered 135 killed or wounded; there were also some 400 Grenadian casualties, and 84 Cubans, mainly construction workers. At the end of 1984, a questionable election was held which was won by a man supported by the Reagan administration. One year later, the human rights organization, Council on Hemispheric Affairs, reported that Grenada's new U.S.-trained police force and counter-insurgency forces had acquired a reputation for brutality, arbitrary arrest, and abuse of authority, and were eroding civil rights. In April 1989, the government issued a list of more than 80 books which were prohibited from being imported. Four months later, the prime minister suspended parliament to forestall a threatened no-confidence vote resulting from what his critics called "an increasingly authoritarian style."
Libya, 1981-89: Libya refused to be a proper Middle East client state of Washington. Its leader, Muammar el-Qaddafi, was uppity. He would have to be punished. U.S. planes shot down two Libyan planes in what Libya regarded as its air space. The U. S . also dropped bombs on the country, killing at least 40 people, including Qaddafi's daughter. There were other attempts to assassinate the man, operations to overthrow him, a major disinformation campaign, economic sanctions, and blaming Libya for being behind the Pan Am 103 bombing without any good evidence.
Panama, 1989: Washington's bombers strike again. December 1989, a large tenement barrio in Panama City wiped out, 15,000 people left homeless. Counting several days of ground fighting against Panamanian forces, 500-something dead was the official body count, what the U.S. and the new U.S.-installed Panamanian government admitted to; other sources, with no less evidence, insisted that thousands had died; 3,000-something wounded. Twenty-three Americans dead, 324 wounded. Question from reporter: "Was it really worth it to send people to their death for this? To get Noriega?" George Bush: "Every human life is precious, and yet I have to answer, yes, it has been worth it." Manuel Noriega had been an American ally and informant for years until he outlived his usefulness. But getting him was not the only motive for the attack. Bush wanted to send a clear message to the people of Nicaragua, who had an election scheduled in two months, that this might be their fate if they reelected the Sandinistas. Bush also wanted to flex some military muscle to illustrate to Congress the need for a large combat-ready force even after the very recent dissolution of the "Soviet threat." The official explanation for the American ouster was Noriega's drug trafficking, which Washington had known about for years and had not been at all bothered by.
Iraq, 1990s: Relentless bombing for more than 40 days and nights, against one of the most advanced nations in the Middle East, devastating its ancient and modern capital city; 177 million pounds of bombs falling on the people of Iraq, the most concentrated aerial onslaught in the history of the world; depleted uranium weapons incinerating people, causing cancer; blasting chemical and biological weapon storage and oil facilities; poisoning the atmosphere to a degree perhaps never matched anywhere; burying soldiers alive, deliberately; the infrastructure destroyed, with a terrible effect on health; sanctions continued to this day multiplying the health problems; perhaps a million children dead by now from all of these things, even more adults. Iraq was the strongest military power among the Arab states. This may have been their crime. Noam Chomsky has written: "It's been a leading, driving doctrine of U.S. foreign policy since the 1940s that the vast and unparalleled energy resources of the Gulf region will be effectively dominated by the United States and its clients, and, crucially, that no independent, indigenous force will be permitted to have a substantial influence on the administration of oil production and price. "
Afghanistan, 1979-92: Everyone knows of the unbelievable repression of women in Afghanistan, carried out by Islamic fundamentalists, even before the Taliban. But how many people know that during the late 1970s and most of the 1980s, Afghanistan had a government committed to bringing the incredibly backward nation into the 20th century, including giving women equal rights? What happened, however, is that the United States poured billions of dollars into waging a terrible war against this government, simply because it was supported by the Soviet Union. Prior to this, CIA operations had knowingly increased the probability of a Soviet intervention, which is what occurred. In the end, the United States won, and the women, and the rest of Afghanistan, lost. More than a million dead, three million disabled, five million refugees, in total about half the population.
El Salvador, 1980-92: El Salvador's dissidents tried to work within the system. But with U.S. support, the government made that impossible, using repeated electoral fraud and murdering hundreds of protesters and strikers. In 1980, the dissidents took to the gun, and civil war. Officially, the U.S. military presence in El Salvador was limited to an advisory capacity. In actuality, military and CIA personnel played a more active role on a continuous basis. About 20 Americans were killed or wounded in helicopter and plane crashes while flying reconnaissance or other missions over combat areas, and considerable evidence surfaced of a U.S. role in the ground fighting as well. The war came to an official end in 1992; 75,000 civilian deaths and the U.S. Treasury depleted by six billion dollars. Meaningful social change has been largely thwarted. A handful of the wealthy still own the country, the poor remain as ever, and dissidents still have to fear right-wing death squads.
Haiti, 1987-94: The U.S. supported the Duvalier family dictatorship for 30 years, then opposed the reformist priest, Jean-Bertrand Aristide. Meanwhile, the CIA was working intimately with death squads, torturers, and drug traffickers. With this as background, the Clinton White House found itself in the awkward position of having to pretend-because of all their rhetoric about "democracy"-that they supported Aristide's return to power in Haiti after he had been ousted in a 1991 military coup. After delaying his return for more than two years, Washington finally had its military restore Aristide to office, but only after obliging the priest to guarantee that he would not help the poor at the expense of the rich, and that he would stick closely to free-market economics. This meant that Haiti would continue to be the assembly plant of the Western Hemisphere, with its workers receiving literally starvation wages.
Yugoslavia, 1999: The United States is bombing the country back to a pre-industrial era. It would like the world to believe that its intervention is motivated only by "humanitarian" impulses. Perhaps the above history of U.S. interventions can help one decide how much weight to place on this claim.
William Blum is the author of Killing Hope: US Military and CIA Interventions Since World War II. P

Economics: The Sound of Aunt Edna's Knitting By John Michael Greer
If the economic landscape beyond Hubbert’s peak proves to be the sort of rough terrain outlined in my last two Archdruid Report posts, how can individuals, families, and communities deal with it? On the large scale, opportunities for action are limited at best, not least because the noise of volatility can too easily hide the signal of decline. Just as recent plunges in the price of oil and natural gas have encouraged the delusion that we no longer have to worry about energy, the upside of the post-peak economy – the fortunes made, the speculative gambles that pay off, the boomtimes when demand destruction crashes energy prices and all seems right with the world – will make it easy for people to convince themselves that industrial society is still on track. It’s easy to understand this sort of thinking, since the alternative is to accept the unacceptable: to admit that the industrial age is ending, and the luxuries, conveniences, and standard of living that define ordinary lifestyles in the modern world are going away, not just for a little while, but forever. That the unacceptable is also inevitable makes it no easier to cope with. Still, accepting the unacceptable is the crucial step in dealing with the economic impact of peak oil. Every assumption about the future has to be reassessed in the light of a contracting economy in which money and other forms of abstract wealth no longer guarantee access to goods and services. Not that long ago in historical terms, it's worth recalling, money actually played a fairly small role in the overall economic picture. Until well after 1700, more than half of all goods and services in the western world were produced and consumed in household and community economies, and exchanged in customary networks governed by obligation and reciprocity, not supply and demand. Most households produced the great majority of their own food, clothing, and other necessities, and used surpluses to barter for specialty goods with other local producers. Cash served as a means of exchange for things produced so far away that transport costs and spoilage made barter unworkable. It took cheap, abundant fossil fuel energy to make transportation so cheap that centralized production and distribution of commodities could take the place of local production for local use. In the aftermath of peak oil, such local economies are the wave of the future, and the money economy of the present and recent past is an anachronism. Since fossil fuel depletion is a gradual process, though, the changeover won’t happen all at once. This is a good thing, since the vast majority of people in the industrial world today lack the skills and tools to function in a local economy. Their jobs – from executives and consultants through salespeople, office staff, and all the other cubicle-shaped pigeonholes in the corporate caste system – serve functions internal to the industrial economy instead of producing goods and services people want or need. The jobs that matter in a deindustrial economy, by contrast, are the ones that meet human needs directly. Farming is the classic example. If you grow food crops with your own labor, you don’t actually need the money economy, except insofar as it forces itself on you by way of property taxes and the like. Your labor provides you with value directly, since some of your crops end up on your own kitchen table; the rest can be exchanged with other local sources of goods and services you need – the seamstress next door, the blacksmith down the road, the general store in town. Money is a convenient way of facilitating these exchanges, but it’s not necessary; you can as well use barter, or local scrip, or any other means of exchanging value that comes to hand. Because what you produce has value to other people, you can trade for the things other people produce that you need, whether or not the money economy is there to mediate the trade. ... In the deindustrial age, then, the farmer’s economic model is the more viable, because it can do without the mediation of the money economy. Other professions that produce necessary goods and services will be in the same comfortable position, since people will continue to need food, clothing, shoes, tools, and the like, and will trade for them using whatever means are available. Except in the most difficult times, they will also be willing to trade for other things that aren’t quite necessities; someone who brews good beer, for example, can count on a market for his wares in all but the most apocalyptic times, and quite possibly even then. Since the twilight of the money economy will be a gradual process, it won’t necessarily be possible for individuals to make the transition to a deindustrial career in a single leap. What can and must be tackled right now is the learning curve demanded by any of these skilled trades. It’s not enough to line your shelves with books about organic farming, for example; you need to start buying tools, digging garden beds, and growing your own crops, and you need to do this as soon as possible, because mastering the craft of organic farming takes time. The same is true if you decide to take up blacksmithying, brewing, small appliance repair, or any other useful trade: you need to get the tools and start learning the craft, so you’ll have your Plan B firmly in place when the money economy folds out from under you. ... People have different opportunities and talents, and one size emphatically does not fit all. For those who have access to garden space, though, a household garden is probably the top priority here. It’s not necessary to grow all your own food, or even a large proportion of your total calorie intake, for this to have a significant impact on your quality of life. In America, at least, bulk crops such as grains and beans will likely be available via the money economy for many years to come. Fruits, vegetables, and animal foods – that is, sources of vitamins, minerals, and protein – are another matter. A vegetable garden, a couple of fruit trees, and perhaps a rabbit hutch or a tank for carp or tilapia may mean the difference between malnutrition and health. If you don’t have access to garden space, consider taking up a useful handicraft or two. Aunt Edna’s habit of knitting cardigans for all and sundry may have seemed quaint in the heyday of the industrial economy, but when central heating prices itself out of existence and transport costs put paid to clothing imports from Third World sweatshops, warm clothing you can make with your own hands has obvious value, and may also be a useful item of barter. The same is true of many other skills, from soapmaking and herbal medicine to the handyman skills that allow plumbing, furniture, and appliances to be repaired at home. Another response to human wants and needs outside the money economy will be vital during the deindustrial age, and needs to be revived and practiced as soon as possible. This is the art of doing without. The industrial economy has trained all of us to think that the only possible thing to do with a desire is fulfill it, preferably by spending money on some consumer product or other. The contracting economy of the deindustrial age will offer very little leeway to this sort of self-indulgent thinking. On the far side of Hubbert’s peak, your capacity to survive will largely be measured by the number of things you can do without. It’s hardly an accident, either, that the world’s spiritual traditions also affirm the value of being unattached to material things. Among the things we will have to learn to do without, though, perhaps the most important is not a material thing at all, but a habit – the deliberate cultivation of uselessness that goes by the name of “leisure.” Only a society flush with cheap energy could convince itself that the highest goal of human life is to sit around doing nothing, and even so it takes the nonstop blare of the media to distract us from the fact that sitting around doing nothing is the dullest of all human activities. Our grandparents’ generation and their ancestors knew as much, which is why leisure a century ago focused on creative activities rather than indolence, and why Aunt Edna knitted all those cardigans long after the industrial economy made home production of clothing unnecessary. The twilight of industrial society, like the fall of other civilizations before it, will doubtless be accompanied by plenty of tumult and shouting, but the real story – the signal behind all that noise – will be a much fainter sound: the soft clatter of Aunt Edna’s knitting needles, beginning to knit the fabric of a new and more sustainable world.