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Monday, January 16, 2006

Your worst nightmare

While Iran continues to thumb its nose at the West - and announces a conference to question the authenticity of the Jewish Holocaust - leading Iranian blogger Hoder offers some words of advice to a worried world:

"Dear US and EU leaders,

"You can't stop Iran from achieving nuclear weapons. You have not enough diplomatic options, nor military solutions. Simply because Iran has played this game much smarter than you.

"To be honest, it's not the bombs that endanger the region. It's the undemocratic, threatening regime of Iran that makes any technology dangerous, let alone nuclear ones.

"So, please, instead of putting all your energy on stopping Iran, channel all your resources to make this regime change its behaviour.

"It's not possible by military attack or coup. It's only possible by helping every Iranian individual understand that they can change this regime if they want to. Not through another violent revolution, but simply through small holes that for whatever reason exit: elections!"

Such advice will no doubt offend the chicken-hawks, but we must do everything to avoid a repeat of the Iraq debacle.

10 Comments:

Blogger Antony Loewenstein said...

Isn't it amazing that a man like Kristol is still even printed? But, of course, the Murdoch press sees itself as serving a higher propaganda purpose.

Monday, January 16, 2006 2:44:00 pm  
Blogger James Waterton said...

I don't agree with Smiths in the slightest. Sure, Iran is a better equipped foe than Iraq, however America is more than able to deal militarily with Iran. Iran holds a couple of weapons that have not been tested in combat before. Take the (thought to be) powerful anti ship missile, the Sunburn, and the threat it poses to American naval vessels. This is hardly a problem, however - carriers can be marginalised if necessary due to the proximity of super US friendly Kuwait, who will more than happily let the Americans fly their jets from Kuwaiti territory using the enormous airbase and runway the Yanks built for the invasion of Iraq. Air defences can be taken out by cruise missiles - of which America has plenty. An invasion would certainly carry more risk of casualties during the hot war phase than - say - the overthrow of Saddam, but I still strongly assert that any sensible pundit would put their money on a swift American victory.

Also, the whole "dollar reserve" is a bunch of conspiracy theorising crap.
For starters, there is no one single element that keeps the American "air in the balloon" - and I find this metaphor economically misleading, as though America's economic might is somehow chimeric - moreso than the American consumer. Other, far wealthier nations than the Middle Eastern sandpits have a powerful and direct interest in maintaining the value of the USD. A slip in the USD caused by excess liquidity from an abandonment of the USD standard in oil trade would quickly be arrested by the central banks of (esp) Japan, China, Taiwan, South Korea and the other Asian manufacturing economies.

Monday, January 16, 2006 11:02:00 pm  
Blogger Pete said...

Onya james

And lets not forget Israel is being directly threated by statements (so far) from Iran. If I were an Israeli I would be in the final stage of an air (and missile) strike (including the US and perhaps UK) to destroy or at least slow down the development of extremely dangerous weapons.

Every new nuclear weapon is a tragedy even if "nobel" developing countries are now in the business of developing them.

Tuesday, January 17, 2006 1:32:00 am  
Blogger James Waterton said...

I'll happily concede that besting Iran's military will not be another Iraq - perhaps more like Iraq mk.1 - however I strongly doubt the US would go to the enormous expense of occupying the country. I imagine that if an invasion were to occur, there would be specific objectives - probably relating to Iran's nuclear programme and perhaps its leadership. Then retreat.

I *strongly* doubt one Exocet missile could take out a carrier. Perhaps if it were a one in a million shot. Perhaps not even then. As you informed me, the Sunburn is a considerably more powerful missile than the Exocet, and what I've read since leads me to believe that a carrier would need to be struck by several Sunburns before it is disabled (sunk).

As for cruise missiles, I suppose their effectiveness depends on their targeting. And reconnaissance - as you and I both know, America has a number of options up its sleeve - not least of all its new generation UAVs like the Global Hawk (surveillance) and Predator (payload).


Onto economic and political consequences;

One of the reasons the oil shocks of the early 70s and 80s were so disruptive is due to the sudden enormous spikes. Over these last few years people have been weened on $60/barrel+ oil prices, so they would probably be considerably more tolerant than the days of the oil shocks. I'm not convinced that $100/barrel is a realistic figure, even in the face of war with Iran. It is possible that if the invasion goes badly and there is a prolonged oil shortage, an economic crisis will develop. Of course this is possible - and I imagine it would be factored into the cost-benefit analysis when and if the decision to go to war with Iran is made. Ditto allies - it's not in Russia's interest to have nukes proliferating in the region, and I can't imagine the Russians risking further humiliation at the hands of the Americans. I'm quite sure a deal could be done behind the scenes to ensure no one loses face, bar the Iranians. Although the Pakistanis are more of a wildcard - an attack on Iran would certainly destabilise Musharraf. However, the Pakistanis are considerably less able to project their force than the Russians, and thus do not represent as grave a threat. Pakistan would be well advised to ensure everything's quiet on the eastern front before it starts attempting to stick up for its neighbours in the west.

Iraq will not necessarily fall into chaos, either. A lot of people make the mistake of lumping Iran and Iraq's shias together simply because they're shias. The moderate Iraqi Shia clerics consistently distance themselves from Tehran. This is a logical sleight of hand that the left loves to peddle, but there is surprisingly little evidence for such a belief.

And what do you mean American markets are notoriously skittish? They have proven for the past 15 years that they are remarkably resilient.

I don't know if the US could freeze USD trading - how could they do so amongst two foreign nations?

Tuesday, January 17, 2006 3:03:00 am  
Blogger James Waterton said...

In any event, you're right about planes coming down. I guess it is more likely that - in the event of a war in Iran - the threat posed against expensive hardware like planes and ships is a lot higher than what we saw in Iraq.

Obviously America would have to consider its commitments elsewhere when it considers what action to take against Iran. Iraq's shias are a tough call, but one they need to get right.

As for the the Americans shutting down the money markets - I have no idea :)

I suppose they could shut down their own markets, which may cause others to follow suit because they would probably plummet without the American lead in a time of crisis.

Tuesday, January 17, 2006 5:40:00 am  
Blogger Pete said...

Weapons such as US B2 bombers (with precision guided bombs) would take out the Iranian anti-ship missile sites (and individual hidden missiles) in the first 5 minutes.

What would Russia do? About as much as they did for Belgrade. If US promises of grants and other diplomatic tradeoffs are good Russia will in the end accept that Iran is liability.

Pakistan - its nukes are aimed at India. A relationship (more or less) amounting to an alliance with the US exists. Why would Pakistan wish to risk all this. If Iran were attacked Pakistan would not wish to paint itself as the next "rogue, Muslim, nuclear, state"

Tuesday, January 17, 2006 11:54:00 am  
Blogger James Waterton said...

Orang - just because I didn't mention "boots on the ground" doesn't mean they weren't invisaged. Point is, a big chunk of the USA's military advantage happens to be airborne. So I concentrated on it. No one is suggesting that this and this alone could topple the mullahs, if it came to that. Do try to keep up.

Re. Iraq's MiGs.. seem to recall reading that Saddam got some back after the Gulf war concluded. Iran kept many. I also remember reading reports that Americans had found and destroyed hidden Iraqi MiGs in 2003.

Tuesday, January 17, 2006 4:54:00 pm  
Blogger James Waterton said...

Sure, we can debate the value of fiat money all day, Smiths. True to my classically liberal leanings, in terms of money I would much rather return to something of tangible value - gold - than rely on the backing of a government. This, however, is another issue entirely.

If oil were suddenly traded in euros, the cataclysmic forecast by many is that the value of the USD would suddenly drop catastrophically, causing massive economic damage in the USA as governments across the world dump their USD holdings in fright.

Trouble is, the manufacturing nations of the world are dead keen to ensure that the American economy keeps on humming, and also that the American dollar is expensive (whilst their own currency is cheap) so that American consumers (the most important people in the world, economically speaking) can buy lots more of their output. Since the collapse of Bretton Woods, Japan has been strategically buying USD to reduce liquidity and inflate the American currency's value. Most (if not all) of the Asian manufacturers peg their currencies at an artificially cheap rate to the USD. China is now a massive player in this game.

If oil ceases to be traded in USD, the former oil producers can do two things - hold their USD reserves (so liquidity on the money markets doesn't change, so the value of the USD remains constant - no problem) or dump their USD holdings, causing a massive increase in USD liquidity. The law of supply and demand kicks in and the value of the USD falls.

However, this goes against the interests of some very big players with exceptionally deep pockets - namely Japan, China, S Korea, Taiwan, Singapore. And to a lesser extent Indonesia, Malaysia, Thailand etc. As soon as the value of the USD starts plummeting, you can bet your bottom dollar that their central banks will immediately intervene to mop up the liquidity and thus prop up the value of the USD to a rate they're happy with via the same principle of supply and demand.

Conspiracy.

Now how does my argument sound, regardless of my lack of credibility?

Tuesday, January 17, 2006 5:13:00 pm  
Blogger James Waterton said...

Yeh, love a good BMW.

Interesting definition of the word "limited". Perhaps you'd like to point out where my thesis is lacking.

Incidentally, I have no idea why the feds aren't going to publish M3 aggregates. Sounds like one of those things economic cons------ theorists fret about.

Incidentally, did you know that the EU usually overshoots its M3 targets by a factor of two?

Tuesday, January 17, 2006 5:34:00 pm  
Blogger James Waterton said...

Tut tut, Orang.

Two regional wars at the same time.

Also, a supercarrier of Nimitz class I *think* has an aircraft capacity of about 80. Australia operates 70ish F/A-18s and 30ish F-111s. So we could kick a supercarrier's arse anyday! Woohoo! India's airforce is better than China's and their pilots are better, too, so don't forget them. Taiwan also has a formidable airforce. I imagine South Korea does, as well.

Okay. Enough military chatter.

What Addamo and I were talking about has nothing to do with the "phwoar!" factor of US military superiority over a country like Iran. We were discussing the potential damage Iran's not inconsiderable defences could do to an American attack on that country.

Tuesday, January 17, 2006 7:47:00 pm  

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