The Nuclear Deal And Democracy

 

 

By Suvrat Raju

10 July, 2008
Countercurrents.org

While much has been written about the Indo-US nuclear deal, a central question remains unasked: "Why is the deal important enough to precipitate a crisis in the government?".

The answer that the proponents of the deal provide –- that the deal is essential for energy security –- is, evidently, simple minded. According to figures provided by Anil Kakodkar –- the chairperson of the Department of Atomic Energy –- the deal will increase India's installed energy capacity by 2.5% by 2020 (1). While the Prime Minister may be perspicacious, this stretches the bounds of sagacity; simply put, governments do not risk self sacrifice for small gains in energy production, 12 years in the future. When one compounds this insignificant gain with the considerable uncertainty that the deal will actually clear the American congress before September, the energy security argument becomes completely untenable.

Indeed, the very desperation of the government to pass this deal indicates, more clearly than anything else, that the deal is not just about energy. While it is clear that the deal is about a larger strategic relationship with the US, this begs the question; most aspects of this relationship, including closer military and economic ties seem to be independent of the deal. So, what is the fuss about?

This question is answered candidly in the American strategic discourse. An alliance with the US entails an essential prerequisite: the government should be in a position to fulfill American demands, irrespective of domestic political considerations. Although, this is deeply undemocratic, this makes sense. Imagine the horror of American legislators if they were to help India obtain a seat in the security council only to find the Indian government arguing against American interference in Venezuela!

Incidentally, this doctrine applies to any bilateral relationship involving the US. During the Iraq war, Rumsfeld dismissed France and Germany as belonging to `old' Europe. As Chomsky pointed out (2), the countries of `new' Europe –- like Italy or Spain –- were those that supported Washington in spite of strong domestic opposition.

Viewed from this perspective, India has behaved well in recent years. Ashley Tellis, an influential advisor to the US government, arguing for the deal in a testimony to the US House of representatives approvingly noted at least 10 instances –- including India's vote against Iran, its support for the war in Afghanistan and its endorsement of American positions on climate change, missile defense and chemical weapons -- where the Indian government acted against domestic opposition and long held policies to support the US.(3)

On the other hand, the existence of an independent democratic discourse in India is a matter of great concern for the US. Ashton Carter, a member of the Clinton administration, lamented to the US senate that the fact that India was a democracy meant that "no government in Delhi can ... commit it to a broad set of actions in support of U.S. Interests" before pointing out that India's "... stubborn adherence to independent positions regarding the world order, economic development, and nuclear security" created a serious hazard for Indo-US strategic ties.(4)

These testimonies merely articulate what is public knowledge. Washington expects compliance from its allies. If India is to be a trusted ally it cannot protest loudly against the oppression of Palestinians, organize developing countries in defense of Iran or repudiate iniquitous conditions laid down by the WTO; it must support the US in diplomatic forums and provide logistical support for US military operations in Asia. Furthermore, and this is critical for American policy makers, this support cannot be contingent on the vagaries of Indian politics. Hence, while the Indian elite is quite willing to accede to these demands, it must first convince the US that its house is in order. It must tame the complexities of Indian democracy so that it can deliver on what it promises. The importance of this cannot be overstated.

In this context, the nuclear deal provides a high profile test case. The passage of the deal, although materially insignificant, is an extremely important matter of principle. If domestic political considerations cause the government to balk, that sets a terrible example and leaves India –- in the words of Ronen Sen –- with "zero credibility".(5) The consequent loss of trust that this will engender in Washington will damage ties with the US for years to come.

In any case, Indian ruling classes have been impatient with democratic dissent since it creates difficulties in their attempts to ram through an elite agenda. As Chidambaram put it (6), "Indian ... democracy has often paralyzed decision making ... this approach must change." After the deal was stalled last year, Manmohan Singh wondered whether a "single party state" would be preferable!(7)

India's newly empowered elite now finds that this frustrating political process threatens its global aspirations. This has brought together powerful interests ranging from India Inc. to NRI lobby in an attempt to remove roadblocks to the deal. These forces are strong enough to impel the government to risk its own survival.

The message, conveyed to the G8, was that India is ruled by a government that is willing to make (in the words of Nicholas Burns, the American negotiator for the nuclear deal), "courageous decisions" (8) -- and bulldoze domestic dissent -- if this is demanded by Washington or Brussels!

This is bad news for Indian democracy. The Indian system, despite its tremendous iniquities and imperfections is based on the notion that governments privilege their survival over all else. The idea that a government may imperil its own existence to fulfill commitments made to a foreign government is antithetical to the idea of democracy. The recent baffling actions of the Manmohan Singh government must be understood as a worrying loss of democratic space.

----------------
References
----------------

(1)The Hindu, 31 October, 2007 and "Energy for India in the coming decades", Anil Kakodkar,
http://www.dae.gov.in/iaea/ak-paris0305.doc

(2)Znet, 31 October, 2003

(3)Testimony by Ashley J. Tellis before the House Committee on International Relations, November 16, 2005

(4)Ashton Carter, Testimony Testimony before the Committee on Foreign Relations, United States Senate, November 2, 2005.

(5)Rediff, Aug 20, 2007: http://www.rediff.com/news/2007/aug/20inter.htm

(6)Convocation Address, IIM Ahmedabad, March 31, 2007 http://financeminister.gov.in/public_speeches/pdf/2007.
3.31%20Convocation%20Address,%20IIM,%20Ahmedabad.pdf

(7)Inaugural Address to the 4th International Conference on Federalism, November 5, 2007

(8)The Hindu, March 1, 2008

Suvrat Raju is a physicist and an activist. He just completed his PhD at Harvard.

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It's The Oil, Stupid!

By Noam Chomsky

10 July, 2008
Khaleej Times

The deal just taking shape between Iraq's Oil Ministry and four Western oil companies raises critical questions about the nature of the US invasion and occupation of Iraq — questions that should certainly be addressed by presidential candidates and seriously discussed in the United States, and of course in occupied Iraq, where it appears that the population has little if any role in determining the future of their country.

Negotiations are under way for Exxon Mobil, Shell, Total and BP — the original partners decades ago in the Iraq Petroleum Company, now joined by Chevron and other smaller oil companies — to renew the oil concession they lost to nationalisation during the years when the oil producers took over their own resources. The no-bid contracts, apparently written by the oil corporations with the help of U.S. officials, prevailed over offers from more than 40 other companies, including companies in China, India and Russia.

"There was suspicion among many in the Arab world and among parts of the American public that the United States had gone to war in Iraq precisely to secure the oil wealth these contracts seek to extract," Andrew E. Kramer wrote in The New York Times.

Kramer's reference to "suspicion" is an understatement. Furthermore, it is highly likely that the military occupation has taken the initiative in restoring the hated Iraq Petroleum Company, which, as Seamus Milne writes in the London Guardian, was imposed under British rule to "dine off Iraq's wealth in a famously exploitative deal."

Later reports speak of delays in the bidding. Much is happening in secrecy, and it would be no surprise if new scandals emerge.

The demand could hardly be more intense. Iraq contains perhaps the second largest oil reserves in the world, which are, furthermore, very cheap to extract: no permafrost or tar sands or deep sea drilling. For US planners, it is imperative that Iraq remain under U.S. control, to the extent possible, as an obedient client state that will also house major U.S. military bases, right at the heart of the world's major energy reserves.

That these were the primary goals of the invasion was always clear enough through the haze of successive pretexts: weapons of mass destruction, Saddam's links with Al-Qaeda, democracy promotion and the war against terrorism, which, as predicted, sharply increased as a result of the invasion.

Last November, the guiding concerns were made explicit when President Bush and Iraq's Prime Minister Nouri Al Maliki signed a "Declaration of Principles," ignoring the U.S. Congress and Iraqi parliament, and the populations of the two countries.

The Declaration left open the possibility of an indefinite long-term U.S. military presence in Iraq that would presumably include the huge air bases now being built around the country, and the "embassy" in Baghdad, a city within a city, unlike any embassy in the world. These are not being constructed to be abandoned.

The Declaration also had a remarkably brazen statement about exploiting the resources of Iraq. It said that the economy of Iraq, which means its oil resources, must be open to foreign investment, "especially American investments." That comes close to a pronouncement that we invaded you so that we can control your country and have privileged access to your resources.

The seriousness of this commitment was underscored in January, when President Bush issued a "signing statement" declaring that he would reject any congressional legislation that restricted funding "to establish any military installation or base for the purpose of providing for the permanent stationing of United States Armed Forces in Iraq" or "to exercise United States control of the oil resources of Iraq."

Extensive resort to "signing statements" to expand executive power is yet another Bush innovation, condemned by the American Bar Association as "contrary to the rule of law and our constitutional separation of powers." To no avail.

Not surprisingly, the Declaration aroused immediate objections in Iraq, among others from Iraqi unions, which survive even under the harsh anti-labour laws that Saddam instituted and the occupation preserves.

In Washington propaganda, the spoiler to US domination in Iraq is Iran. U.S. problems in Iraq are blamed on Iran. US Secretary of State Condoleezza Rice sees a simple solution: "foreign forces" and "foreign arms" should be withdrawn from Iraq — Iran's, not ours.

The confrontation over Iran's nuclear programme heightens the tensions. The Bush administration's "regime change" policy toward Iran comes with ominous threats of force (there Bush is joined by both US presidential candidates). The policy also is reported to include terrorism within Iran — again legitimate, for the world rulers. A majority of the American people favours diplomacy and oppose the use of force. But public opinion is largely irrelevant to policy formation, not just in this case.

An irony is that Iraq is turning into a US-Iranian condominium. The Maliki government is the sector of Iraqi society most supported by Iran. The so-called Iraqi army — just another militia — is largely based on the Badr brigade, which was trained in Iran, and fought on the Iranian side during the Iran-Iraq war.

Nir Rosen, one of the most astute and knowledgeable correspondents in the region, observes that the main target of the US-Maliki military operations, Moktada Al Sadr, is disliked by Iran as well: He's independent and has popular support, therefore dangerous.

Iran "clearly supported Prime Minister Maliki and the Iraqi government against what they described as 'illegal armed groups' (of Moktada's Mahdi army) in the recent conflict in Basra," Rosen writes, "which is not surprising given that their main proxy in Iraq, the Supreme Iraqi Islamic Council dominates the Iraqi state and is Maliki's main backer."

"There is no proxy war in Iraq," Rosen concludes, "because the U.S. and Iran share the same proxy."

Teheran is presumably pleased to see the United States institute and sustain a government in Iraq that's receptive to their influence. For the Iraqi people, however, that government continues to be a disaster, very likely with worse to come.

In Foreign Affairs, Steven Simon points out that current US counterinsurgency strategy is "stoking the three forces that have traditionally threatened the stability of Middle Eastern states: tribalism, warlordism and sectarianism." The outcome might be "a strong, centralised state ruled by a military junta that would resemble" Saddam's regime.

If Washington achieves its goals, then its actions are justified. Reactions are quite different when Vladimir Putin succeeds in pacifying Chechnya, to an extent well beyond what Gen. David Petraeus has achieved in Iraq. But that is THEM, and this is US. Criteria are therefore entirely different.

In the US, the Democrats are silenced now because of the supposed success of the US military surge in Iraq. Their silence reflects the fact that there are no principled criticisms of the war. In this way of regarding the world, if you're achieving your goals, the war and occupation are justified. The sweetheart oil deals come with the territory.

In fact, the whole invasion is a war crime — indeed the supreme international crime, differing from other war crimes in that it encompasses all the evil that follows, in the terms of the Nuremberg judgment. This is among the topics that can't be discussed, in the presidential campaign or elsewhere. Why are we in Iraq? What do we owe Iraqis for destroying their country? The majority of the American people favour US withdrawal from Iraq. Do their voices matter?

When the going gets tough, economists go very quiet.

 

 

They're happy to take the credit in the good times, but the disciples of this false science are hard to find as recession looms

 

• 
• • Simon Jenkins
  • The Guardian,
  • Wednesday July 9, 2008

 

So the Footsie has tumbled again. Forgive me for asking, but where are the economists? As the nation approaches recession, an entire profession seems to have vanished over the horizon, like conmen stuffed with cash, and thousands left destitute behind. They said recessions were over. They told politicians to leave things to them and all would be fine. Yet they failed to spot the sub-prime housing crash, and now look at the mess.
When I studied economics we were told we would be masters of the universe. Ours was not a dismal but a noble science. It had harnessed the verities of maths to those of human behaviour and would go on to conquer politics. Rampant recession would go the way of hyperinflation. Like leprosy and cholera, they were epidemics that modern medicine had rid from our shores.
It did not matter if the economists were welfare Keynesians such as Myrdal, Robinson and Galbraith or free-marketeers such as Marshall, Friedman and the Institute of Economic Affairs. All were "social scientists". They claimed to have cracked the DNA of economic exchange, to have turned the base metal of money into political gold.
We believed them. We believed the Keynesians until we slumped into stagflation. We believed light-regulation capitalists such as Margaret Thatcher and Gordon Brown, that they could convert boom-bust into an upward sloping plane of glory. We believed the Bank of England when it said that, in its hands, inflation was dead and prosperity eternal. Bliss was it in that dawn to be alive - and an economist.
If Britain were now in the grip of bubonic plague, there would be all hell to pay from some profession or other. An "influential" Commons committee would be summoning the chief medical officer and subjecting him to the third degree. Why no national rat strategy? Why no crash inoculation? Why so many planning delays on plague pits?
The espionage pundits were likewise castigated for wrongly leading the nation to war against Iraq, for giving dud professional assessments on fallacious intelligence. The architectural profession has taken the rap (very occasionally) for the grotesque failures of public housing in the 1970s. Climate scientists may yet be damned for the costly lunacy of new energy sources, such as wind turbines and biofuels.
Yet economics is a Teflon profession. A quarter of a century ago 364 practitioners wrote a letter denouncing the policies of the then Thatcher government as having "no basis in economic theory". They were wrong in fact and wrong in judgment. Thatcher's policies laid the groundwork for a strategic shift in the underpinning of British prosperity. There was no inquiry, no hearing, no peep of retraction or remorse.
Since then economists have flooded into government; there were roughly a thousand at the last count. What do they all do? Despite reports of demoralisation in the Treasury, that department remains the home base for public sector management through financial aggregates. During the Blair/Brown era it has held government in thrall.
Economic managers have always claimed credit for the success of Brown's Treasury regime. They have espoused quantifiable outputs, targets and delivery indicators. They invented the celebrity consultant and the maxim that only what measures matters. Above all, the economics profession (and its house journal, the Economist) was ecstatic when Brown delegated monetary control to the Bank of England. This was supposed to isolate the economy from political pressure, subcontracting the regulation of interest rates and markets.
Today we are older and wiser. Controlling the agencies of credit has proved beyond the finest professional minds in the game. Where now are the effortless pundits of the Treasury and the Bank? Where now the gilded ones of Moody's and Standard & Poor's, credit raters to the mightiest in the land? They should have stuck to goose entrails.
Alan Greenspan, former chief of the US Federal Reserve Board and a Brown adviser, is unrepentant. He recently declared that "anticipating the next financial malfunction ... has not proved feasible". There is nothing so unseeing as a wronged economist. The Bank of England's apologias over Northern Rock have been protests that regulation is a mess and government indecisive.
When muck hits fan, economists always blame politicians. They would have some justice if they did not take credit when things go right. I was always uncomfortable at the overselling of economics as a science, when it is rather a branch of psychology, a study of the peculiarities of human nature. Its spurious objectivity, manifest in its ridiculous love affair with maths, induced a "Jupiter complex", a conviction that scientific certainty, applied with enough rigour to any problem, triumphs over all.
Economic management is and always will be about politics, about the clash of needs and demands resolved through the constitutional process. The delegation of interest rates to the Bank of England worked when it ran in parallel with politics, but not any more. Now that reflation seems urgent for recovery, the system is biased against common sense, yet no politician dare tell the Bank to cut rates and risk inflation.
The newest craze is "nudge" economics, from the Americans, Richard Thaler and Cass Sunstein. They put the subject firmly among the behavioural sciences - if not the arts. Human actions are too mysterious and unpredictable to be liable to quantification and modelling. They are responsive to what the academic Paul Ormerod called "butterfly economics". Nudge steers, but does not order or plan.
This requires knowledge of the working of markets, incentives, expectations and panics. But converting micro-economics into macro has always been a dangerous game. Much has been made of the success of Spain's dirigiste banking regulators in putting security before runaway profit. But this was a triumph of politics over economics. Greenspan may laconically remark that "we can never have a perfect model of risk", but we can have alertness to risk and we can have caution.
Economics has long traded on being a science when it is not. In this it is like war. For a third of a century since the 1976 IMF crisis it has enjoyed great influence over British policy. Now it has met its Waterloo and a little humility would be in order. Once again economics must be rescued by that true master of all things, politics.

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Big Oil's Iraq deals are the greatest stick-up in history

The country's invaders should be paying billions in reparations not using the war as a reason to pillage its richest resource


Naomi Klein The Guardian,
Friday July 4, 2008

Once oil passed $140 a barrel, even the most rabidly rightwing media hosts had to prove their populist credibility by devoting a portion of every show to bashing Big Oil. Some have gone so far as to invite me on for a friendly chat about an insidious new phenomenon: "disaster capitalism." It usually goes well - until it doesn't.

For instance, "independent conservative" radio host Jerry Doyle and I were having a perfectly amiable conversation about sleazy insurance companies and inept politicians when this happened: "I think I have a quick way to bring the prices down," Doyle announced. "We've invested $650bn to liberate a nation of 25 million people, shouldn't we just demand that they give us oil? There should be tankers after tankers backed up like a traffic jam getting into the Lincoln Tunnel, the stinkin' Lincoln, at rush-hour with thank-you notes from the Iraqi government ... Why don't we just take the oil? We've invested it liberating a country. I can have the problem solved of gas prices coming down in 10 days, not 10 years."

There were a couple of problems with Doyle's plan, of course. The first was that he was describing the biggest stick-up in world history. The second that he was too late. "We" are already heisting Iraq's oil, or at least are on the brink of doing so.

It started with no-bid service contracts announced for Exxon Mobil, Chevron, Shell, BP and Total (they have yet to be signed but are still on course). Paying multinationals for their technical expertise is not unusual in itself. What is odd is that such contracts almost invariably go to oil service companies - not to the oil majors, whose work is exploring, producing and owning carbon wealth. The contracts only make sense in the context of reports that the oil majors have insisted on the right of first refusal on subsequent contracts handed out to manage and produce Iraq's oilfields. In other words, other companies will be free to bid on those future contracts, but these companies will win.

One week after the no-bid service deals were announced, the world caught its first glimpse of the real prize. After years of backroom arm-twisting, Iraq is officially flinging open six of its major oilfields, accounting for half of its known reserves, to foreign investors. According to Iraq's oil minister, the long-term contracts will be signed within a year. While ostensibly under the control of the Iraq National Oil Company, foreign corporations will keep 75% of the value of the contracts, leaving just 25% for their Iraqi partners.

That kind of ratio is unheard of in oil-rich Arab and Persian states, where achieving majority national control over oil was the defining victory of anti-colonial struggles. According to Greg Muttitt, a London-based oil expert, the assumption up until now was that foreign multinationals would be brought in to develop new fields in Iraq - not to take over those which are already in production and therefore require minimal technical support. "The policy was always to allocate these fields to the Iraq National Oil Company," he told me. "This is a total reversal of that policy, giving the Iraq National Oil Company a mere 25% instead of the planned 100%."

So what makes such lousy deals possible in Iraq, which has already suffered so much? Paradoxically, it is Iraq's suffering - its never-ending crisis - that is the rationale for an arrangement that threatens to drain Iraq's treasury of its main revenue source. The logic goes like this: Iraq's oil industry needs foreign expertise because years of punishing sanctions starved it of new technology, while the invasion and continuing violence degraded it further. And Iraq needs to start producing more oil urgently. Why? Also because of the war. The country is shattered and the billions handed out in no-bid contracts to western firms have failed to rebuild it.

And that's where the new contracts come in: they will raise more money, but Iraq has become such a treacherous place that the oil majors must be induced to take the risk of investing. Thus the invasion of Iraq neatly creates the argument for its subsequent pillage.

Several of the architects of the Iraq war no longer even bother to deny that oil was a major motivator for the invasion. On US National Public Radio's To the Point, Fadhil Chalabi, one of the primary Iraqi advisers to the Bush administration in the lead-up to the invasion, recently described the war as "a strategic move on the part of the United States of America and the UK to have a military presence in the Gulf in order to secure [oil] supplies in the future". Chalabi, who served as Iraq's oil undersecretary of state and met with the oil majors before the invasion, described this as "a primary objective".

Invading countries to seize their natural resources is illegal under the Geneva conventions. That means the huge task of rebuilding Iraq's infrastructure - including its oil infrastructure - is the financial responsibility of Iraq's invaders. They should be forced to pay reparations, just as Saddam Hussein's regime paid $9bn to Kuwait in reparations for its 1990 invasion. Instead, Iraq is being forced to sell 75% of its national patrimony to pay the bills for its own illegal invasion and occupation.

Markets won't correct the soaring prices that threaten our economic wellbeing. So governments must.

The world must kick its addiction to oil

Markets won't correct the soaring prices that threaten our economic wellbeing. So governments must

Anatole Kaletsky

At the time of the last energy shock in the 1970s, Sheikh Yamani, the shrewd Saudi Oil Minister, famously told his greedier Opec colleagues that they would encourage replacement of oil by other energy sources and kill the golden goose that had made them wealthy if they kept pushing the oil price too high. “Remember,” he said, “the Stone Age didn't end because the cavemen ran out of stone.”

The last three global recessions - in 1974, 1980 and 1991 - were all triggered by an oil shock and it looks as if Opec is now determined to repeat this experience. How many such shocks will it take before we control our addiction to oil? Cynics will say that all the world's oil will have to run dry before we see any decisive action in the US or China to reduce and ultimately eliminate their oil demand. But a confluence of economics, politics, diplomacy, environmentalism and finance has suddenly been created which may unexpectedly prove the cynics wrong. An oil price of $140, never mind $200 or $300, is simply too economically damaging to be tolerated much longer.

The question is no longer whether oil prices will be left to the market, but whether political interventions that override market forces will improve or worsen the situation.

The usual answer to this question is the latter, which is why Western policymakers have been reluctant to do very much so far to curb the oil price. Such, in fact, is the faith in “oil market fundamentals” expressed, for example, by Gordon Brown and the recent Treasury paper he commissioned on the oil shock that one is drawn to a surprising conclusion: the main reason for inaction in the face of the oil shock may not be the lack of political will to implement difficult decisions, such as higher petrol taxes or government guarantees for nuclear construction, but simply the ideology of market fundamentalism, expressed in such slogans as “the market is always right”.

But the market is not always right. It is usually right, but sometimes it is spectacularly wrong - as in the recent sub-prime saga. To acknowledge that governments must sometimes correct market failures is not to reject the economic lessons of the 1980s but rather to apply a proper understanding of economics.

There are three main reasons why the market cannot be trusted in the case of oil. First, there is the enormous gap between the cost of producing oil in areas where it is abundant and the cost of producing any close substitutes for this oil. Easily accessible oil in places such as Saudi Arabia, Venezuela and Nigeria costs only a few dollars a barrel to pump once an oilfield is producing. Even including exploration expenses, the total cost of production of Opec oil is well below $10 a barrel.

However, the cost of any substitute runs to $50 or $60 a barrel, whether the Opec oil is replaced by oil from more hostile environments, such as deep-sea drilling in the Arctic, or by some other energy source such as nuclear or wind power. The gap between cheap Opec oil and any other energy source creates an enormous “rent”, beyond any normal return on capital and costs of production, which either accrues to Opec as profits or to consumers as the benefit they enjoy from an energy source cheaper than any alternative in their own economies.

This rent, currently running at around $2 trillion annually, is at the heart of the perennial struggle between oil-producing and consuming governments. Either Western governments claim most of the rent for themselves by levying high taxes on domestic oil consumers, or Opec governments pocket most of the rent, as they are doing today.

But why shouldn't this rent be distributed “fairly” or “rationally” by market forces? The answer lies in the second “market failure” inherent in the oil business - monopoly power. Because almost all of the world's readily accessible oil is concentrated in a handful of nations, they have been able to achieve almost total monopoly power through Opec. With the supply of oil controlled by a monopoly, there is nothing “efficient” about the level of prices set in the market; and the competition between producers and consumers inevitably becomes an issue of politics, rather than economics.

The rational response of Western governments to this monopoly power is to lower the cost of energy substitutes by accelerating technological advances and increasing economies of scale. This can be done by imposing very high taxes on oil consumption to guarantee high profits for producers of non-oil fuels. At the same time, such taxes can ensure that most of the rent earned from the difference between consumer prices and Opec production costs stays in Western treasuries instead of going to producer governments.

The use of tax policy to capture rents for Western governments would be particularly effective if combined with regulations designed to prevent money being poured into speculative markets for “paper oil” - which brings us to the third reason why price signals are misleading in the market for oil.

The gap between physical trading in oil and the paper markets in oil futures and oil-company shares raises all sorts of financial anomalies. One is the ramping-up of oil prices by institutional investors. Another is the strong incentive for Western oil companies to invest in oil exploration, which is inherently inefficient, when competing with low-cost state-owned producers, instead of investing in new technologies to replace oil, where Western economies have a comparative advantage over Opec.

As a result of these perverse incentives, Western energy executives invariably insist that there is no plausible alternative to oil. For example, Rex Tillerson, chairman of Exxon, remarked last year that he wasn't interested in biofuel research because “I don't have a lot of technology to add to moonshine”. Tony Hayward, chief executive of BP, wrote a few weeks ago that “humankind remains dependent on fossil fuels” because renewable sources now account for only 2 per cent of global energy use. This is hardly surprising, since companies such as BP and Exxon have no special skills in nuclear power, wind turbines or photovoltaics, and they have strong vested interests in political and fiscal support to explore for oil in ever more difficult and hostile regions of the world. But such support cannot be economically justified since Opec will always have an unbeatable comparative advantage in producing oil.

If Western governments play their cards correctly, people such as Mr Tillerson and Mr Hayward will be proved wrong - and ironically Sheikh Yamani will eventually be proved right. The world will wean itself off oil long before the sands of Saudi Arabia run dry.

Could sex save your life?

Making love doesn't just help you feel good. It also burns calories, boosts your immune system – and can even reduce the risk of cancer

By Dan Roberts
Tuesday, 1 July 2008


Boosting self-esteem was one of the 237 reasons people have sex, according to a study conducted last year by researchers from the University of Texas and published in the Archives of Sexual Behavior. This is no surprise to Julia Cole, author of How to Have Great Sex for the Rest of Your Life. She is convinced that a healthy sex life with a loving partner does wonders for the way you feel about yourself. "After a bout of sex the body releases endorphins, which are known as 'happy chemicals' because they improve mood," she says. "Purely from a physical point of view it's similar to enjoying a good workout or going swimming – but if you're having sex with someone you love it also makes you feel cared for and promotes self-esteem."


The proviso, of course, is that if your sexual experiences are unhappy ones, they will have a similarly negative impact upon your psyche. But assuming the sex is good, it is thought to improve body image, as well as reducing anxiety and the incidence of psychiatric illness, depression and suicide. A 2004 study of men from four different cultures found that sexual satisfaction was directly associated with an increased frequency in sexual intercourse, as well as being inversely related to depression.


During orgasm the body produces oxytocin, which is a hormone linked to a range of positive physical and psychological effects. Chief among these is its beneficial impact on sleep. "There's no doubt that sex is relaxing and so helps tackle insomnia," says Dr David Delvin, a GP and specialist in sexual medicine. "Lots of people use sex, whether with a partner or on their own, as a way of getting to sleep. That's down to the surge in oxytocin during arousal and orgasm, which is a natural sedative."

This view is backed up by a US study carried out in 2000, which found that 32 per cent of the 1,866 female respondents who reported masturbating in the previous three months did so to help them sleep.


One of sex's main health benefits is its positive impact on how we deal with stress. In a study published in the journal Biological Psychology, 24 women and 22 men kept records of their sexual activity. The researchers subjected them to stressful situations, such as public speaking and doing verbal arithmetic. Those who had intercourse had better responses to stressful scenarios than those who had either engaged in other sexual behaviours or abstained altogether.

According to Julia Cole, this could be down to the soothing effect another person's touch has. She says: "A great deal of research has shown that touch has a naturally calming effect on human beings, whether it's linked to sex or not. Of course, being touched by someone you care about will double the calming effect."

Apart from the obviously pleasurable sensation of being touched or stroked, it is thought to have a biochemical effect, reducing the levels of cortisol – the hormone that is secreted when you're under stress.


Having sex once or twice a week has been linked with higher levels of an antibody called immunoglobulin A, or IgA, which can protect you from colds and other sorts of infections. Scientists at Wilkes University in the US tested IgA levels in 112 college students who reported the frequency of their sexual activity. Those students in the "frequent" group had higher levels of IgA than those who were either abstinent or had sex less than once a week.

Paula Hall, a psychosexual therapist with Relate, also thinks that the impact of sex on our general wellbeing helps to boost immunity. "All the psychological benefits have an impact on your physical health, such as your immune system," she says. "We know that when you're feeling good about yourself your body fights off illness and disease better – so the healthier we are psychologically and emotionally, the healthier we are physically."


Frequent ejaculations may reduce the risk of prostate cancer for men in later life, according to a study by Australian researchers reported in the British Journal of Urology International. When they followed men diagnosed with prostate cancer and those without it, the researchers found that men who had at least five or more ejaculations weekly during their twenties reduced their risk of getting prostate cancer by a third.

"The evidence is good that men who masturbated regularly in the past are less likely to get prostate cancer," confirms Dr Delvin. "Nobody knows exactly why this is, but it does seem to be pretty cast-iron."

Research also suggests that regular sexual activity could help women to avoid breast cancer. A study conducted in 1989 examined 146 French women and found a higher risk of breast cancer in those women without sexual partner or who had sex less than once a month.


Having sex and orgasms is a key part of improving intimacy and ensuring a healthy long-term relationship – which has been linked to a longer lifespan in a number of studies. It's all down to oxytocin again. "Oxytocin, also called the 'bonding hormone', is released when women give birth, so it is part of the bonding process with their baby," says Julia Cole. "It's also released in people who are in secure or long-term relationships, as well as during sexual contact. This bonding effect is one of the reasons people continue to have a sexual relationship long after they have ceased to be fertile."

This was backed up by a study conducted by researchers from the University of Pittsburgh. They evaluated 59 premenopausal women before and after warm contact with their partners ended with hugs. The study found that the more contact the women had, the higher their oxytocin levels were.

And studies in which couples were asked to go without sex for long periods found that their general relationship declined, indicating that sex has a powerful bonding effect for couples. "There's also the slightly more indefinable feeling that you are thought to be attractive and someone your partner wants to be with and touch," adds Cole. "That's very important – often when I see couples who are in trouble they have stopped having sex, and one of them will say their partner no longer thinks of them as attractive."


Sex has been linked with a pain reduction for a wide range of conditions, including lower back pain, migraines, arthritis and premenstrual syndrome symptoms. It's all down to those hormones again. "Sex increases endorphins, the body's natural painkillers," confirms Dr Delvin. "So there is evidence that having sex eases period pain and PMS."

Oxytocin is also linked with pain relief. In a study published in the Bulletin of Experimental Biology and Medicine, 48 volunteers who inhaled oxytocin vapour and then had their fingers pricked reduced their sensitivity to pain by half.

In 2001, two studies of orgasms and migraine headaches in a woman and man found that orgasm resulted in pain relief. And an earlier study of 83 women who suffered from migraines reported that orgasm resulted in pain relief for more than half of the group. Although this form of pain relief is less reliable and effective than the use of drug therapies, the effects of orgasm as an analgesic are more rapid.


Sexual activity, like other forms of exercise, burns both calories and fat. Thirty minutes of energetic sex burns 85 calories or more. Although this may not sound like much, it does add up – 42 half-hour sessions will burn 3,570 calories, which is enough to lose a pound. "Sex does burn calories, so it's comparable to moderate exercise like doing the housework or going swimming," says Dr Delvin. And it is, clearly, a great deal more fun.

But there is something of a chicken-and-egg element here, because people who lead more active sex lives tend to exercise more regularly and physical exercise improves sexual health. A 1990 study that followed 78 men over a nine-month period found that with consistent aerobic exercise, participants had an increase in frequency of sexual activity, improvement in performance and an increased ability to reach a "satisfying" orgasm.


One of the most extensive studies into the relationship between sex and mortality was carried out in Caerphilly, South Wales, from 1979 to 1983, with a 10-year follow-up. In the study, 918 men were given a physical examination and asked about their frequency of orgasm. After 10 years it was found that the mortality risk was 50 per cent lower among men who had frequent orgasms – which was defined as two or more per week. The study also found that, even when adjusting for age and other risk factors, frequent intercourse was associated with lower incidence of cardiovascular disease and stroke.

"There has been a great deal of research into whether people in relationships live longer," adds Paula Hall. "We know that having a strong relationship is a good indicator of longevity – and a healthy sex life is a big part of that."

Davis's fight is not just for liberty. It is for Britain's soul.

Davis's fight is not just for liberty. It is for Britain's soul.

In defending 800 years of hard-won political rights, this rebel is also standing up for a crucial part of the national spirit

Jan Morris
The Guardian, Wednesday June 25, 2008

Whether David Davis makes of himself a public hero or a popular buffoon by his plunge into notoriety, he stands for me as an allegorical monitor of our times. His behaviour has been quixotic, but like the great mad progenitor of the condition, Don Quixote of La Mancha, he is fighting a cause in a truly fateful battle - a battle for liberty of the human spirit.

It is not just a matter of those 42 days, of habeas corpus or even of human rights in the political sense of the phrase: it is an elemental struggle that is dividing the British again into two nations, as Benjamin Disraeli saw them long ago. They are in vulnerable condition anyway, their natural resistance weakened - all in a mess, demoralised, lacking confidence and conviction, enervated by failure and alien principles, swept this way and that by the forces of a rotten materialist culture.

And of the contemporary two nations, it seems to me, by far the greater is giving up on liberty. Anyone can see that in Britain, 2008, individuality is being suppressed, so that year by year, generation by generation, the people are being bullied or brainwashed into docile conformity. What is more ominous is that so many want to be docile. They want to be supervised, cosseted, homogenised, obedient.

The ubiquitous CCTV cameras are the emblems of this malaise, not because of their existence but because people accept them as necessary for the public good: the police tell them so, councils tell them so, statistics proclaim it, and so they believe it, and are perfectly willing to be spied upon, night and day, wherever they go, by unknown, invisible strangers out of sight.

The so-called war on terror is of course the supposed excuse for this appalling violation of all our privacies, together with the ominous rise of the secret intelligence agencies. The public has been gulled into acceptance of the supervisory state, with all its paraphernalia of surveillance and identity cards, DNA databases, armed police and arbitrary search, by the mantra: "If you don't do anything wrong, why worry?"

Brainwashed by a tabloid press of brilliantly insidious techniques, then, numbed by the relentless mediocrity of television, half the people have willingly forfeited the right to make up their own minds, and mutely accept indoctrination. "He's not afraid of anything," I overheard one young mother say to another, watching her three-year-old clambering over an obstacle, but the reply came straight from the state: "Oh that's dangerous, you must never allow him to think like that."

Even the middle classes, once the very backbone of robust individualism, are not immune to the contagion. They all think twice about expressing their views in case they say something that is politically incorrect. They preposterously mollycoddle their children, not only because they have been so repeatedly warned of life's unspeakable dangers but also because they wonder what the neighbours will think. They are officially encouraged to snoop and sneak on their fellow citizens, so snoop and sneak they do.

And when you are afraid to say what you think, it is a step nearer to the most dreadful condition of all: being afraid of what to think. As I see it, Davis's display concerns not just political liberty but liberty of the mind, of the identity, of the spirit - even, patriots might sententiously say, of the national soul. It is not simply 800 years of hard-won political rights he is defending, it is nothing less than a view of life itself, which civilised peoples have so pain-stakingly fashioned down the centuries. It has been an old pride of the British that they, above all, have honoured the truest forms of freedom, with all its anomalies, eccentricities and humour, above and beside all politics, obeying only laws they respect.

A few more generations of nagging and surveillance and we shall have forgotten what true freedom is. Young people will have foregone the excitements of risk, academics will temper all thought with caution, and the great public will accept without demur all restrictions and requirements of the state. Ours will be a people moulded to docility, perfect fodder for ideologues. Then if the one nation of the British slides into autocracy, guided by opportunist or witless politicians and a gullible press, the other nation will be goaded towards despotism too. Already every free soul, I suspect, has sometimes wished that we had a benevolent dictator to sweep all the nonsense aside, the flabbiness and the conformity, the brainwash and all. Some day the structure may crack, and we shall find ourselves under the autocracy of conformists or libertarians - both forced into totalitarianism in defence of their own philosophies.

So perhaps Davis is a prophet as well as a politician. When he talks of habeas corpus he is echoing ideas far older and more profound, reaching back to the earliest yearnings of antiquity, the first glimmerings of human individuality, when our ancestors began to break from tribal disciplines and devise preferences of their own. Tribalism is what every despotism hopes to impose on its people. It is the will of the party, which Davis has apparently flouted. It is the will of the majority, which is one reason why Gordon Brown feels no need to put up a candidate at Haltemprice and Howden. Today the whistleblowers are our guardians of the spirit, and I like to think that Davis is one of them - a true successor of the grand old knight of Castile, but alas, tilting at windmills that are all too real.

· Jan Morris is a historian, travel writer and former Guardian correspondent