In My View

For whom, Power?

As the crow flies, the distance between New Delhi and Kathmandu is 802 kms. Yet, the ‘bourgeois’ power elite – as the communists are wont to call some - in the two capitals are so similar in their approach and desire for power. First let’s see Nepal, where I was a fortnight ago.

The main communist party there, the CPN (Maoist) has won in a general election so handsomely that they have emerged as the single largest party. Since the election is for a Constituent Assembly of the country – to frame a new Constitution – the CPN (Maoist), whose ‘democratic’ credentials are being questioned there everyday, said that they wanted a government of national consensus to govern in the interim period, while the country’s constitution is drafted.

But to do that, the previous government needed to resign. That government is led by Nepal’s old war-horse, GP Koirala of the Nepalese Congress (NC). And he refuses to resign. Why? Because he says that the interim constitution by which he was positioned as the prime minister in 2006 did not have an explicit provision calling for the government to resign to pave way for the victors in the popular polls.

If that piece of logic seems impossible, his apologists have some more. For, a senior editor in Nepal who calls himself ‘left liberal’ – one can recall how many people turned ‘left liberal’ in New Delhi soon after the Congress-led UPA government came to power with the support of the left – told this writer that Koirala is “not resigning because he wants to own up for the past mistakes.” That is the reason why he wants to become a president of the new republic. How ludicrous can you get?

So the Maoists now have pushed Koirala’s hands. Their ministers have resigned from Koirala’s cabinet. And they are making one last ditch effort to form a government with the CPN (United Marxist Leninist) – the third largest party - keeping the recalcitrant NC out. Last fortnight they seemed like a party straining at the leash of Parliamentary politics, trying to deal with sobriety a situation that ‘bourgeois democratic politics’ in that country has handed out.

But Baburam Bhattarai, the CPN (Maoist) leader had told me that if their attempts at forming a government is foiled by the so called ‘democrats’ they would go to the people and mobilise them while allowing the Constituent Assembly to frame the new constitution. Thereby hangs one tale.

The other story is now being played out in New Delhi which has similar cast of characters. Here is a group of communist and left parties who support the Congress-led UPA government from outside of government, differing with the latter vehemently about what kind of a country India should be. Should India become a strategic (read military) partner of the USA that has wreaked havoc in this part of the world – Asia – since the 1950s? The Indian left parties also fear that if India gets locked into that kind of a relationship with the USA it would for a long time be in an antagonistic relationship with a giant next door neighbour, China, all for the sake of a partner 14,000 kms away. And finally, the left parties are not sure what the Indian power elite would do next for their constituents in Washington if the deal went through.

One may ask the question that hey, this is just a deal for civilian nuclear power. That question today is really moot. For had it been just about nuclear power, would a Congress prime minister stake his all on that deal. A story is being touted around the country that the Indian nuclear power programme is facing severe shortage of uranium, hence we need the deal. But doesn’t the Nuclear Suppliers’ Group (NSG) have a ‘safety clause’ emergency provision by which even a non-NPT country can seek Uranium from one of the member countries. Just in 2006 Russia gave India Uranium under that provision for Tarapur and later informed the NSG.

So this is not about just ‘a’ nuclear deal. There is more to it and the Congress leadership knows it. But did they contest the 2004 election on the issue of forging a strategic relationship with the USA? They did not. Shouldn’t they have held a referendum in the country before concluding such a deal and got a popular verdict beforehand? What do the democrats say, social or otherwise? Or does the Congress leadership in India like GP Koirala want to ‘own up past mistakes,’ thus be in power?

For the past few days I had been reading declassified exchanges between Henry Kissinger and Richard Nixon on the one side and the Chinese leadership on the other. These took place in 1971-2. And at one place, Nixon argues for establishment of a relationship with the Chinese on the fact that the latter could be attacked by India, backed by the Soviet Union!

How time changes, but people don’t.

Pinaki Bhattacharya, currently located in Kolkata, is a Special Correspondent with the Mathrubhumi, Kerala. He writes on Strategic Security issues. He can be contacted at pinaki63@dataone.in

Tributes to Tim Russert

In My View

How to Fix the Oil Spigot?

We knew that the US president, George W Bush had bills to pay to the oil majors. They had bankrolled him for long. But what we do need to know is: that those paying the cash are Us. And what are we paying for? To finance the inflating coffers of some of the most regressive entities the world over.

That A-list includes the Salafist Saudi regime; their other equally regressive cousins ruling other oil producing West Asian nations. The list also has with top billing the American oil companies, who are earning hyper-profits at the cost of the consumers right down to the bottom level of the pecking order.

It is ironic that while everyone in the world is talking about inflation and price rise, there is a sense of inevitability that shrouds the runaway increase in oil prices. A neo-liberal media has created this environment of impending oil shortage on account of rise in demand from China and India to fuel price expectancy of the consumers. They have even used every scrap of bad news to explain the spikes in oil prices.

The real reasons lay elsewhere. A school textbook economic sense tells us that the prices are determined by supply and demand. But is also tells us that this would occur in a perfect market condition. The oil market is rigged to such an extent that only a few like the American energy economist, Matthew Simmons, believe that oil has economics related to it.

Instead, oil is about politics. Ever since 1938, when the American Standard Oil of California first struck oil in Saudi Arabia, and later formed Aramco (Arab-American Oil Compnay) with Texas Oil, politics governed the price of oil and its so called economic. On the one hand it enriched the enclaves of retrograde Arab princelings who ruled the countries of the oil-producing West Asian region, in turn oil also helped establish the domination of dollar as the world’s reserve currency, thus creating an American economic suzerainty.

The rise of the nationalist left in West Asia, signaled by the victory Mohammad Mossadegh in Iran, put enough pressure on these medieval regimes to scramble for some vestiges of modernism. Simultaneously, they tried to approproiate the pan-Arab nationalism of the leftist forces by staging an opposition to the existence of Israel on Palestinian lands. Hence, the price shock of 1970s that eventually led to the price of oil in 1980 - in the wake American hostages crisis in Iran - to close nearly at $ 100 per barrel of crude.

In March this year that highest level was breached. Today, oil is selling at close to $ 130 per barrel, which in inflation adjusted dollar is higher than the highest rate of the 1970s oil shock period and the 1979 crisis. What are the causes for this seemingly inexorable rise?

Considering that the dismal science has an overwhelming influence on our minds, the first cause had to be supply. The total oil supply is two million barrels per day short of the global demand of 87 million barrels per day. And you might laugh aloud at this, the US Congress has decided to sue the Organisation of Petroleum Exporting Countries (OPEC) – its primary client – for defaulting on production!

But the more important cause is what the Christian Democratic government in Berlin seems to have suddenly discovered only this week: speculation in oil futures. Traders in the New York Minerals Exchange (NYMEX) have made hundreds of billion dollars trading in oil futures almost since George W Bush invaded Iraq.

Traditional futures trading is price speculation based on economic fundamentals of given situation. But the current investors driving oil prices up in NYMEX are the ‘index’ speculators. These are people who invest in commodity indices, not on commodities themselves. They invest in the indices not to wait for the time when they would go up following the logic of a capitalist development. But instead, they actually first invest in the indices, which then re-invest the index funds to acquire the commodity futures contracts commensurate with the value of the original investment. This thus creates a vicious cycle of escalation as pernicious as the sub prime mortgage boom on the USA that went bust.

In simpler terms they are 21^st century’s hi-tech giant hoarders who today, by some calculation, hold as much oil as China’s current annual demand of 920 million barrels of oil. Need we to go look anywhere else for reasons behind the oil price leap?

The Germans have now demanded a ban on the futures trading of oil. But it is the governments of China and India who need to break up the party. They can for one shift to spot buys in a cartelized manner - instead of long term contracts - at whatever is the current rate. That would stop the speculative cycle based upon longer term price expectations on oil.

Another strategy would be to diversify the source of oil away from the dollar denominated areas to the euro areas like Venezuela and Iran. Even Nigeria could be made to fall in line if the two big sources of demand co-operate amongst themselves. Of course, we have to keep in mind that only a month ago, India’s Foreign Minister, Pranab Mukherjee had gone and paid obeisance to the Saudi royals. This visit was quite out of the blue, even after the Organisation of Islamic Countries only recently raised the Kashmir stick to beat India with. Strange are the ways of politics.

Pinaki Bhattacharya, currently located in Kolkata, is a Special Correspondent with the Mathrubhum, Kerala. He writes on Strategic Security issues. He can be contacted at pinaki63@dataone.in .

In My View

For a fistful of rice

Such are the signs of the times. The US president, George W Bush blames China and India for rice rationing in US stores. He claims that rising demand for food in newly prosperous China and India is cutting down the supplies to the developed world. If one thought, this was one of his famous gaffes, read what his staunch ally, European Union was saying. The European Union’s commissioner for agriculture and rural development echoed the same sentiments only a few days after Bush said his piece.

Those statements can be viewed in more ways than one. One such view would be to see it as a grudging acceptance of the changing global reality. The current issue of the venerable Foreign Affairs journal carries an apologia on the US, shoring up its waning power. Fareed Zakaria argues in that piece that while during Queen Victoria’s times, the Sun did not set on British Empire, it did set within a century. But he argues, the Sun might not set on the US Empire for a few reasons.

Zakaria, like all first generation immigrant converts, has an abiding faith in the USA’s continuing economic supremacy. He also believes that the country’s ever expanding GDP would be able to sustain the nation’s key leverage, the ever expanding military adventures, thus upholding its political suzerainty on much of the globe.He also believes that the USA’s ability to attract immigrants gives it an edge over, say, Europe. He feels that though manufacturing has left American shores, the country’s competitiveness would be continued on the back of research, innovation and design. Zakaria says that the US’s lead in quality higher education would give it an edge over countries like China and India. Ironically, he sees the US’s bane in its politics being captured by “special interests, a sensationalist media, and ideological attack groups.”

Each of these points are belied by a separate set of facts. A recent survey by the US’s Northwest Area Foundation says that one in two Americans say that there are a “lot” of people in their immediate communities who are struggling to make ends meet. Four in ten Americans say there are a lot of people working full-time jobs, yet still struggling economically.

Half of the American public says that they personally know someone who works two jobs, but still is struggling. But the study argues that poverty and a lack of development in the USA is a “local issue.” And there lies the rub.

For, the crisis of the USA today is systemic. It is an accumulation of sins committed by successive governments riding on the back of an extreme rightward shift of a dominant section of the population – the chauvinistic white working class of the American South. Robert Brenner writes in New Left Review that the US’s Republican Party under the likes of George W Bush’s chief henchman, Karl Rove, made political inroads in this traditional Democratic Party vote bank by pandering to racism and patriarchy. He writes, “Southern workers were politically atomized, individualized in the extreme, and therefore unusually open - not to say historically prepared - to embrace non-class forms of solidarity: race, the patriarchal family, nationalism-cum-militarism, and Protestant fundamentalism, now linked to Zionist expansionism.”

Much like the rise of the BJP in India on the back of the new middle class steeped in conservatism in the country’s politically sterile Hindi belt, the American white working class was on the rebound from the entitlement battles of the Blacks. Here again lies the similarity with the BJP’s electorate, which had its political ideology honed on the reaction to the entitlement struggles of the Indian Muslims.

Much like India this politics of reaction laid the foundation of private corporation driven economic liberalism in the USA beginning with the Ronald Reagan phase. Brenner writes that because the American South saw enormous growth in the 1970s but had the “weakest trade union and welfare infrastructure,” the white, working class backed the American Republican Party’s project “to construct an anti-statist individualist ideology founded on white supremacy, defence of the patriarchal family and Protestant fundamentalism.”

The result has been the decimation of the ‘left’ faction of the Democratic Party that was born on the crucible of labour rights agitations of the American trade unions since the 1920s and that had come into its own during Lyndon Jhonson’s “Great Society” experiment, which had as its goal a large “welfare state,” albeit based on high state spending in the midst of high corporate profitability.

Brenner writes that the folly of the Democratic Party of not reining corporate power resulted in the loci of politics shifting further to the right and its eventual marginalisation in the 1970s and 1980s. In the 1990s, under Bill Clinton, the Democratic Party re-emerged sans the ‘left,’ after it moved to the right and emulated the Republican Party.

He concludes by saying that the US economy has been growing on the basis of economic bubbles – first the stock market bubble of the 1990s, then the asset-price bubble as seen in the housing boom. This has led the country into the current crisis. Add to that free trade capitalism that corporate America has imposed on the country, and the dimensions of American misfortune appear bigger than Bush’s plaints about rising food and fuel prices. It signals the tectonic shifts taking place in world politics.

Pinaki Bhattacharya, currently located in Kolkata, is a Special Correspondent with the Mathrubhumi, Kerala. He writes on Strategic Security issues. He can be contacted at pinaki63@dataone.in

In My View

US: Deceit, deception and doubletalk on Iran

Finally, New Delhi seems to have found the plot. Not a plot of land that most in Delhi strive for and goons build upon, but a plot of the story. It has told official Washington to take the long road, while it takes the high road. Ministry of External Affair’s statement on Tuesday that it does not want any “guidance” from the US on its conduct of bilateral relations with Iran was its sharpest reaction, after years of wheedling in front of the ‘almighty’ ever since the BJP-led National Democratic Alliance (NDA) government exploded a few nuclear bombs in 1998 in a fit of pique.

Mahmoud Ahmadinejad, the Iranian president would be stopping over in New Delhi on the way back from Sri Lanka this week. And the American homilies were a precursor to this visit.

This visit is coming at a time when Muqtada al-Sadr, the Shia leader in Iraq has warned the governing leadership in that country with severe attacks on its forces if they did not stop attacking his Mahdi army members. In Palestine, Jimmy Carter, the former American president has met the Hamas leaders in Gaza to extract assurances that they would accept Israel’s existence on their borders. And a fortnight ago, Ahmadinejad had declared that Iran has brought in line a few thousands more of gas centrifuges to process Uranium for their civilian nuclear programme.

President Ahmadinejad is coming to India at a time when his nominees have tasted defeat in local bodies elections, ostensibly because his government is losing support on the streets of Iran on account of a lack of economic progress. Power seems to be slipping out of his hands and the gainers are the moderate, pragmatists like Hashemi Rafsanjani.

On the back of such high decibel campaigns against the Iranian nuclear programme, the latter has become an issue of prime prestige for Ahmadinejad’s government. Most importantly, the Iranian president is visiting India in the same of month – April – when his country celebrates the ‘Nuclear Day.’ The 8 April date was when Iran had produced its first batches of low enriched Uranium (LEU) for its nuclear programme two years ago.

The Iranian government has sought to tie it with the sense of nationhood of the people by deciding to distribute to each poor Iranian $50 on that day. Some say that the money also signifies the government’s sensitivity to the popular critique that the nuclear showpieces are really very expensive and have little value for delivering goods to the common people.

There are also reports in non-Western news sources that the common sight in Teheran of ayatollahs in flowing robes is slowly vanishing, being replaced by those who are keener on the economy and security. In that transition, the Iranian Republican Guards, who are a unique organisation in that they are a State by themselves, are emerging as the new lightning rod for politics, business and security. One should keep in mind, Ahmadinejad is their man.

The USA wants India to ignore all this and follow its lead in ostracising Iran and keep it isolated till Washington gets a handle on it. Only a week ago a British newspaper had revealed that the USA was engaged in “Track two” engagement with Iran. The British newspaper had quoted the US undersecretary of state, Thomas Pickering, saying that the country had been in conversation with Iran for “five years,” despite all the vituperation in public.

The USA is also hedging its bets on an Iranian version of Ahmed Chalabi, the Iraqi magnate who and his ilk led the US into a war with Saddam Hussein’s regime. This is a group called Mujahid-e-Khalq. They were declared a ‘terrorist outfit’ by the British government in 2001. But there are reports that the British courts might lift that tag, and make it free to be coddled by the Western agencies for subversion in Iran.

For India, the National Security Adviser, Mr MK Narayan’s rather self-conscious pronouncement that New Delhi did not want to indulge in “conflict diplomacy” might well define the parameters of the relationship. It reflects correctly on the current abilities of India in terms of interventions on Iran. On the other hand, India would need to decide how much ground it could yield to China on the issue, but still maintain its relevance in a neighbourhood that is proximate.

In that circumstance, it would be important what New Delhi does, now that Murli Deora, the petroleum minister, has seen the light of day on the Iran-Pakistan-India gas pipeline. By the time Ahmadinejad arrives in the Capital, he would have returned from Pakistan after holding talks on the pipeline. And he would have known whether China has already ousted India from the deal.

Having said that, it would be amiss if it were not pointed out that India would still have to deal with an American administration that would seek to “obliterate” a nation of more than 70 million people, with thousands of years of civilisation were it to threaten an enclave of the West in West Asia. - a nation that holds to ransom a region that is hundred times bigger than itself, all because it has a Bomb in the Basement.

Pinaki Bhattacharya, currently located in Kolkata, is a Special Correspondent with the Mathrubhumi, Kerala. He writes on Strategic Security issues. He can be contacted at pinaki63@dataone.in