Submitted for your consideration by Gabrielle Jones Price
with permission from the author and copyright holder.
with permission from the author and copyright holder.
Excerpt from Crossing the Rubicon:
The Decline of the American Empire at the End of the Age of Oil
Published in 2004 / Chapter 6
Laying The Foundation: Destroy Russia, Prepare The Battlefield
by Michael C. Ruppert
by Michael C. Ruppert
Zbigniew Brzezinski's 1997 The Grand Chessboard: American Primacy and Its Geostrategic Imperatives laid a foundation for what became the 9/11 attacks. Some four years before the fact, the book articulated what purpose that disaster served in the creation and extension of an openly imperial new American order. But in doing so, Brzezinski gave us all a vivid glimpse of the remarkable foresight and planning that was brought to bear upon world events by the players who participated.
If what we find predicted in that book has been validated by events since September 11, 2001, we must infer that Peak Oil is no surprise to the Bush Administration. And given the timing of the book, Brzezinski's background, and the patterns of strategic continuity that have dominated US foreign policy since the height of the Vietnam War, Peak Oil was never far from the minds of the Clinton administration, or the first Bush administration, or the Reagan administration, or the Carter administration. The Nixon administration faced the peak of US domestic oil production and the first massive OPEC-induced oil price shocks. To anyone whose head isn't totally submerged in the conventional wisdom, it's always been clear that a production cut must be either artificial or natural. Whether or not OPEC cuts oil production today, geology will be cutting it tomorrow.
When American oil production peaked in the early 1970's, there were hopes that oil discoveries -- particularly in central Asia -- would mitigate the peak. Still, there was one major obstacle to US control of the Middle East: Russia.
Brzezinski is [was] a member of the elite that presides above the American political system, which is frequently and accurately described as two factions compromising a single (corporate) party. He is best remembered as the National Security Advisor to President Jimmy Carter from 1977 to 1981. But his influence and power are better understood in light of his ongoing service as an intelligence advisor to both President Reagan and Bush I. In 1988, he served as co-chairman of the Bush National Security Advisory Task Force. He is a Professor of American foreign policy at Johns Hopkins University. And perhaps most importantly, he's a colleague and friends of both David Rockefeller and Henry Kissinger. Brzezinski is a past member of the board of directors of the Council of Foreign Relations and a co-founder with Rockefeller of the Trilateral Commission (Jimmy Carter is also a member of both CFR and the Trilateral Commission). Brzezinski also served, as recently as 1998, as a paid consultant for BP-Amoco, one of the three largest investors in the Caspian basin.(1)
On December 24, 1979, the Soviet Army occupied Afghanistan and seized the capital, Kabul. It was the beginning of a decade-long, Vietnam-like conflict that debilitated the Soviet Union. Afghanistan was so much like Vietnam that it quickly developed a self-sustaining dynamic of massive heroin smuggling from a neighboring country, a dynamic that ran parallel to the war while remaining linked to it -- not least by turning a percentage of the invading troops into addicts. In the case of Vietnam, the neighboring country was Laos, which then hosted the largest CIA station in history under the direction of legendary covert operative Ted Shackley. In Afghanistan, the neighboring country was Pakistan, where a massive CIA operation sprouted to support Mujahideen freedom fighters.
In both wars heroin became the dominant note in the theme music behind the action. As noted by Professor Alfred McCoy, in 1975 none of the heroin entering the US came from Pakistan. By 1980 some 40 percent of the heroin in the US came from Pakistan, which had virtually become a CIA protectorate by that time.(2) Another striking similarity is that in both conflicts the CIA created powerful local warlords who were very well armed and who effectively prevented any national government from restoring stability. In both cases, the warlords derived their power from their direct involvement in the drug trade.
In Afghanistan Brzezinski demonstrated that he and his colleagues were capable of preparing the stage for conflict long before the fighting -- or the stakes -- became visible to the world at large.
Just before the Soviet invasion, a Soviet-friendly regime had taken over Kabul in a coup and had instituted broad social reforms. But agitation believed to be backed by the regime of the Ayatollah Khomeini in Iran soon led to an uprising that prompted the first official request for limited Soviet military assistance to maintain control of key facilities in Herat.(3) In July, five months before the Russian invasion, President Carter, at the urging of Brzezinski, signed a secret directive for clandestine assistance to enemies of the pro-Soviet regime in Afghanistan (i.e., agents of our allegedly sworn enemy in Iran, the Ayatollah Khomeini).(4)
This was the first indication that a major conflict was being engineered behind the scenes. US assistance created more battles, threatening the Kabul regime and, ultimately, threatening the Soviet troops. That was what sucked the Russians into making a move that the United States immediately portrayed to the world as a massive and unprovoked invasion. An important question, asked frequently at the time, was, What in the world could the Russians possibly want with Afghanistan? There were very few good reasons. Afghanistan wasn't producing much opium in those days.
Brzezinski admitted the setup and much more in 1998 to a French interviewer: "We didn't push the Russians to intervene, but we consciously increased the probability that they would... Regret what? That secret operation was an excellent idea. It had the effect of drawing the Russians into the Afghan trap. You want me to regret that?" When the interviewer asked if he regretted having supported the Islamic fundamentalists and giving arms and advice to future terrorists, Brzezinski replied: "What is more important to the history of the world ... the Taliban or the collapse of the Soviet empire? Some stirred-up Moslems or the liberation of Central Europe and the end of the cold war?"(5)
By 1997 the Soviet Union had been dead for six years. A new world had emerged in which the United States alone ranked as a superpower. Yet Russia still remained a threat -- a potential block to the complete imposition of US economic and military will. So, to a lesser extent, did China, which, although it had a huge population, was technologically and militarily no match for the United States. China also represented the possibility of huge profits for American business. Another obstacle was the American people, who, as Brzezinski would note, were not psychologically built for the ways in which America would have to exercise dominion in absence of a fair fight. It was to these and other issues -- especially energy -- that Brzezinski turned his attention in 1997 when he wrote The Grand Chessboard. Russia, as it turns out, is mentioned more frequently than any other country in the book.(6)
It was in Russia's backyard, the central Asian republics of the old Soviet Union, where Brzezinski saw that the move would have to be made. The history of mankind had always shown that controlling the heart of Eurasia was the key to controlling the entire globe. Though motives had changed over 20 centuries, this area's strategic importance remained essentially the same. Brzezinski spelled out the compelling issue driving American policy:
A power that dominates Eurasia would control two of the world's three most advanced and economically productive regions. A mere glance at the map also suggests that control over Eurasia would automatically entail Africa's subordination, rendering the Western Hemisphere and Oceania [Australia] geopolitically peripheral to the world's central continent. About 75 percent of the world's people live in Eurasia , and most of the world's physical wealth is there as well, both in its enterprises and underneath its soil. Eurasia accounts for 60 percent of the world's GNP and about three-fourths of the world's known energy resources.(7)The energy theme appeared again later:
The world's energy consumption is bound to vastly increase over the next two or three decades. Estimates by the US Department of Energy anticipate that world demand will rise by more than 50 percent between 1993 and 2015, with the most significant increase in consumption occurring in the Far East. The momentum of Asia's economic development is already generating massive pressures for the exploration and exploitation of new sources of energy.(8)With the Middle East safely but quietly included in the dissertation, Brzezinski again stressed the energy importance of Eurasia, particularly for the critical goal of diversification of energy supplies:
Moreover, they [the Central Asian Republics] are of importance from the standpoint of security and historical ambitions to at least three of their most immediate and more powerful neighbors, namely Russia, Turkey, and Iran, with China also signaling an increasing political interest in the region. But the Eurasian Balkans are infinitely more important as a potential economic prize: an enormous concentration of natural gas and oil reserves is located in the region, in addition to important minerals, including gold.(9)As for Russia, the imperative was clear:
Understandably, the immediate task has to be to reduce the probability of political anarchy or a reversion to a hostile dictatorship in a crumbling state still possessing a nuclear arsenal. But the long-range task remains: how to encourage Russia's democratic transformation and economic recovery while avoiding the reemergence of a Eurasian empire that could obstruct the American Geostrategic goal...(10)
But in the meantime, it is imperative that no Eurasian challenger [i.e., Russia] emerges, capable of dominating Eurasia and thus of also challenging America. The formulation of a comprehensive and integrated Eurasian geostrategy is therefore the purpose of this book.(11)Brzezinski gave one of several reasons why the US supported the Taliban and, indirectly, al Qaeda:
In fact, an Islamic revival -- already abetted from the outside not only by Iran but also Saudi Arabia -- is likely to become the mobilizing impulse for the increasingly pervasive new nationalisms, determined to oppose any reintegration under Russian -- and hence infidel -- control.(12)This is a clear signal and admission that the United States had fostered and encouraged radical Islamic fundamentalist movements as a means to an end in Central Asia. Their usefulness to that end, as we shall see in subsequent chapters, certainly did not end with the fall of the Soviet Union.
Before going to the next Brzezinski quotation, consider the following ironic examples of how the United States created hatred and violence in Afghanistan. The first example concerns the actions of the US agency for International Development (USAID), long known to be a progeny of the Central Intelligence Agency. I am indebted to the incredible work of Paul Thompson for finding these illustrative and darkly humorous anecdotes. His entire timeline can be found at <cooperativeresearch.org> [This URL appears in the book, published in 2004. The URL is no longer valid but you can find the timeline at historycommons.org]
1984 - 1994: The US through USAID and the University of Nebraska, spends millions of dollars developing and printing text-books for Afghan schoolchildren. The textbooks are filled with violent images and militant Islamic teachings, part of covert attempts to spur resistance to the Soviet occupation. For instance, children are taught to count with illustrations showing tanks, missiles, and land mines. In the absence of any alternative, millions of these textbooks continue to be used long after 1994, and the Taliban were still using them in 2001. In 2002, the US has started making less violent versions of the same books, which Bush touts will have 'respect for human dignity, instead of indoctrinating students with fanaticism and bigotry." Bush fails to mention who created those books.(13) [Washington Post, 3/23/02, CBC, 5/6/02]Just three years later Unocal, then fiercely motivated and fiercely frustrated by the Taliban in its efforts to build a trans-Afghani pipeline, hired the University of Nebraska to train 400 Afghani teachers, electricians, carpenters, and pipe fitters in anticipation of using them for their pipeline. They had 150 attending classes in anticipation of successful negotiations.(14)
No doubt, Brzezinski had energy issues very much on his mind. He noted throughout the book that the region was becoming increasingly prone to violence. What he did not admit was that much of the violence was being initiated by US proxies. He placed two key maps in his book that would be of evidentiary value in the inconceivable scenario that the true 9/11 war-makers were ever brought to trial. One he labeled "The Global Zone of Percolating Violence."(15)
The second was a map labeled "The Eurasian Balkans" on which he placed a large circle indicating where he felt the next global conflict would emerge.(16)
Given that these maps were drawn and published a full four years before the first plane hit the World Trade Center, they would fall into a category of evidence I learned about as LAPD. We called them "clues."
As it turns out, The Grand Chessboard was a study prepared for the Council on Foreign Relations (CFR), also founded by the Rockefellers.(17)
Eliminating the competition
Two very important things happened immediately after the collapse of the Soviet Union in December 1991. The United States undertook a massive effort to help the FSU (Former Soviet Union), and in particular Russia, make a "successful transition" to capitalism, and the major oil companies stepped up their ongoing, oft-frustrated post-perestroika efforts to explore and establish joint ventures in the newly independent and oil-rich Central Asian republics of Kazakhstan, Turkmenistan, and Uzbekistan. Oil companies frequently had a number of CIA covert operatives on their payrolls posing as geologists and oil experts.(18)
As it turns out, both efforts were intended to remove large amounts of wealth from the region. Both may have had the equally important objective of preparing the way for the unopposed massive US military deployments in Central Asia that began in October of 2001 after the World Trade Center attacks.
Though the seeds had been planted by the outgoing first Bush administration, the US assistance program to facilitate Russia's transition to capitalism took off under the new Clinton administration in 1993. A task force headed by Vice President Al Gore, Treasury Secretary Lawrence Summers, Deputy Secretary of State Strobe Talbot(19) and involving exclusive US Treasury contracts with Goldman Sachs, the Harvard Institute for International Development, the IMF, and the World Bank worked in partnership with the government of Boris Yeltsin to remake the Russian economy. What happened was that Russia, in the words of Yeltsin himself, became a "mafiocracy" and was looted of more than $500 billion in assets: its economy was ruined, its currency destroyed, its population rendered desperate, and its ability to support a world-class military establishment smashed.
Journalist Anne Williamson was for many years a leading expert on Russian and Soviet affairs, writing for, among others, the Wall Street Journal, the New York Times, Mother Jones, and SPY. She lived in Russia, spoke the language, and saw first-hand what was done to Russia in the 1990s. In 1999 she completed a book on the subject, Contagion: The Betrayal of Liberty, Russia, and the United States in the 1990s, which despite a signed publishing contract has never been published, like so many other completed manuscripts that might have been vital to the world's understanding. According to Williamson, one publisher simply refused to read her first draft (October 1997), in which she explained the causes and mechanisms of the impending collapse of the Russian market that occurred in August of 1998.
But Williamson did present her knowledge of what had happened in Russia to Congress in 1999, and that record is available. She pulled no punches in describing the rape of a country and of a people who had already been victimized by seven decades of Soviet communism:
And there is no mistake as to who the victims are, i.e., Western, principally US, taxpayers and Russian citizens whose national legacy was stolen only to be squandered and/or invested in Western real estate and equities markets.
Western assistance, IMF lending, and the targeted division of national assets are what provided Boris Yeltsin the initial wherewithal to purchase his constituency of ex-Komsomol [Communist Youth League] bank chiefs, who were given the freedom and the mechanisms to plunder their own economy in tandem with a resurgent and more economically competent criminal class. The new elite learned everything about confiscation of wealth, but nothing about its creation.(20)
Brzezinski had made it a priority to identify the motivating factors that drove the political elites in a country that needed to be managed. What Williamson described is the creation and installation of a whole new set of elites, the oligarchs, whose motives -- personal enrichment at any cost -- were already known. The Empire loved the oligarchs because they were simple and could be easily controlled with money.
Williamson described two crucial mistakes made by the US fiscal experts who had exclusive contracts to manage the transition. First, they ignored the concept of private property (there had been none under Communism or under the Tsarist regimes). This gave the people no inherent rights to enormous physical equities such as real estate, manufacturing plants, oil refineries, mineral rights. Their only claim to ownership lay in the notion of post-Soviet assets as an abstract communal holding established by the Soviet Constitution inconvenient. In the privatization program Harvard University and World Bank operatives devised and US taxpayers unknowingly financed, those constitutionally guaranteed communal ownership rights were transferred to the state, and only then parceled out to elected individuals in rigged auctions. Second, the good guys from the West turned loose monopoly markets, which caused prices to skyrocket. What little money individual Russians possessed was transferred quickly into the hands of the corrupt oligarchs -- the "mafiya" with whom Boris Yeltsin had made his pact.(21)
Once all the assets had been transferred to the oligarchs, who were becoming fabulously wealthy, it was a simple matter for them to liquidate those assets by selling them to the US and other Western countries, and then laundering their money through US financial institutions such as the Bank of New York.(22) The money laundering and transfer of wealth made more than the Russian oligarchs rich. Billions of dollars accrued to Bank of New York executives and stockholders in 1999.(23) And during the years of the Clinton administration, as Al Gore worked in exclusive partnership with Russian Deputy Prime Minister Victor Chernomyrdin, the Harvard Endowment's value rose from 3 to 19-plus billion dollars.(24)
Compounding the pillage, a number of investment schemes sponsored by the Export-Import Bank of the United States, the Overseas Private Investment Corporation (OPIC), and a number of congressionally mandated "enterprise funds" were designed for individuals, Russian corporations, and banks. In essence, these initiatives wound up being huge money laundries. The domestic bound market's highly unjustified returns, paid with IMF loans, attracted many eager investors, and soon developed into a classic pyramid scheme. As quickly as the IMF, the World Bank, and other financial entities lent the money to Russia to realize mind-boggling returns for favored players, the money was taken right back out of Russia. Those huge sums, initially provided by taxpayers, returned to Wall Street, US banks and Harvard.(25)
Russia was literally a free lunch for American institutions and non-profits. Williamson observed:
Even the Ford Foundations's Moscow office sponsored its own internal Russian bond shop for which the unthinking Russian managers once asked this reporter to drum up US investors.(26)It's interesting to note that the Ford Foundation is actively involved in the funding of "progressive" American media outlets, including Pacifica Radio, FAIR, Progressive Magazine, and is indirectly involved in several other well-known progressive media outlets and pundits.(27) At the same time, the Ford Foundation has been linked to the secret society Skull and Bones (through the late McGeorge Bundy), the Trilateral Commission, the Council on Foreign Relations, and the CIA.(28) Both George W. Bush and John Kerry are members of that secret society.
Remarkably, all that heavy Western investment in the Russian bond market was executed largely in defiance of Russian Federation legislation that limited foreign participation in that market. The Clinton administration and Harvard operatives looked the other way as major Clinton campaign donors employed corrupt Russian officials and financial notables to purchase bonds beyond the legal limits on foreign participation set by the Russian government. Williamson noted in her testimony, "The bread and butter of all equity markets are bonds. Wall Street wanted a debt market. You [USAID] build it and we'll come, they said."
Williamson's unpublished manuscript details how those firms got in on the ground floor, such as Goldman Sachs, were able to work from the inside through alliances with personnel from Harvard's Russia Project.(29) Bonds represent debt. As with any debt, if it can't be paid, then the collateral used to secure it is forfeited. In this case, throughout the 1990s, what was forfeited was Russia's ability to function as a nation, to feed its people, and especially to support its military.
In the end, literally starved for cash, Russia sold much of its military equipment onto the black market. Some of it wound up in the hands of terrorist organizations from Bosnia to Chechnya and Russia's southern frontiers.(30) Again, when the time came for the US Empire to militarily occupy Central Asia and surround the oil fields of the Middle East, Russia had grave economic and military problems to deal with.
In describing how one particular looting scheme operated, Williamson testified:
The CIA has determined that through Nordex, FPI [the International Foundation for Privatization and Private Investment] seized the export earnings from Russia's natural resource companies -- oil, gas, platinum, gold, diamonds -- and from industrial firms exporting items such as steel and aluminum, and then stashed the hefty profits in Western bank accounts. And only now, eight years almost to the day later, do US taxpayers learn that the 'eager, young reformers' to whom their resources were sent for the purpose of building a new Russia were in league from day one with the exhausted Soviet nomenklatura in a scheme to loot Russia's wealth and park it in the West...(31)
Directors stashed profits abroad, withheld employees' wages, and after cash famine set in, used those wages, confiscated profits and state subsidies to 'buy' the workers' shares from them. The really good stuff -- oil companies, metals plants, telecoms -- was distributed to essentially seven individuals, 'the oligarchs,' on insider auctions whose results were agreed beforehand. Once effective control was established, directors -- uncertain themselves of the durability of their claim to the newly acquired property -- chose to asset strip with impunity instead of developing their new holdings.
Is all of this starting to sound a bit like Enron? Like WorldCom? Tyco? Halliburton? Like any of about 20 major US companies I could name? It is perhaps not by coincidence that we see some familiar names cropping up in the orchestration of this campaign to loot Russia that continued across two different presidential administrations. The US secretary of state who began the dialogues on privatization as well as the dismantling of Russia's nuclear weapons was James A. Baker. The James Baker Institute was the co-sponsor of the CFR report on energy in 2001, and James Baker was, in the words of one oil industry lawyer, "all over" the deals to get the major oil companies into Central Asia. The first official US envoy sent to aid Russia in its transitions was our current  Deputy Secretary of State, Richard Armitage.
Eventually, of course, the Russian economy collapsed so badly that it was necessary to secure an IMF bailout. That's the kiss of death for any country. Americans paid for that. Then in 1998 the Russian ruble inevitably collapsed because the debt couldn't be paid, and the people started starving in earnest. Consider these passages from a congressional investigation, the aforementioned Cox Report:
The culmination of the Clinton administration's fatally flawed macro-economic policy for Russia occurred in August 1998, when Russia's default on its debts and devaluation of the ruble led to the nation's total economic collapse. By all measurements, the disaster was worse than America's crash of 1929.
The disaster that began on August 17, 1998, spread immediately throughout Russia. Millions of ordinary men and women who had deposited their money in Russian banks lost everything. ATM and debit cards ceased to work. Dozens of banks became insolvent and disappeared. Angry depositors besieged Russian banks, only to learn they had been wiped out.
Millions of senior citizens, whose meager pension income had been suspended for months, were cut off completely. When the dust finally settled in March 1999, the ruble -- and with it, every Russian's life savings -- had lost fully 75 percent of its value.
The devastation of Russia's economy was worse than what America experienced during the Great Depression. By 1932, the US gross national product had been cut by almost one-third. But within just six months of the 1998 crash, Russia's economy, measured in dollars, had fallen by more than two-thirds. From $422 billion in 1997 [the year when The Grand Chessboard was published], Russia's gross domestic product fell to only $132 billion by the end of 1998.
At the end of 1929, following America's disastrous stock market crash, unemployment in the United States reached 1.5 million, representing 1.2 percent of the total population. The 1998 collapse of the Russian economy was far worse: 11.3 million Russians were jobless at the end of 1998 -- 7.7 percent of the nation's total population.
In the crash of 1929, stock prices fell 17 percent by year end -- and 90 percent by the depth of the Great Depression four years later. By contrast, the Russian stock market lost 90 percent of its value in 1998 alone.
"Most fundamentally," said Sergei Markow, an analyst at the Institute of Political Studies, "it is a crisis of the real economy -- Russia doesn't work."(32)
How much capital was looted out of Russia? Five hundred billion dollars, according to Congress.(33) And that $500 billion was not stockholder equity, a paper loss from some mutual fund. It was cash.
This congressional investigative report into what had happened in Russia came from the House Policy Committee under chairman Chris Cox (R-CA), a fierce Clinton opponent and supporter of the failed impeachment effort. It told some hard truths, but accomplished very little. Cox made the mistake of believing that what he had revealed -- e.g., that the Clinton administration and Al Gore had openly gotten involved with criminals, and likely engaged in criminal behavior themselves -- was something that would hurt his political opponents. Of course, it did not. What Cox failed to understand was that he was exposing an effort that was above partisan politics -- an effort that was therefore protected. On the other hand, James Leach, Chairman of the House Committee on Banking and Financial Services, understood this reality perfectly. Once "instructed," Leach immediately buried the findings from his own committee's 1999 hearings into Russian money laundering.
Cox would not be the first experienced member of Congress to suffer for his own naivete. As we will see, another Republican Congressman would make the same false assumption about the Clinton administration's activities, this time with respect to the Taliban.
Anne Williamson succinctly summed up what had been done to the people of Russia. She pointed out, "The Soviet Union was economically self-sufficient except for bananas, coffee, and coconuts."(34) By the dawning of the new century, except for small parts of Moscow, Saint Petersburg, and other cities where the oligarchs spent their money, it was as badly ruined as it had been at the worst part of World War II. It was a basket case that was self-sufficient in nothing except for its own oil that, incidentally, had already past peak of production.
Special thanks are due to Anne Williamson, who provided most of the research for the Cox Committee's report and received so little acknowledgement for it.
Audio excerpts from Crossing The Rubicon are in development.
This is a labor of love, connecting dots and honoring Michael's spirit. Help keep
About : Published in 2004, Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil by Michael C. Ruppert, remains a book of great historic significance. Close to 700 pages long with over 900 footnotes, it is a testament to Ruppert's years of exemplary service as a detective and investigative journalist. Crossing the Rubicon's findings remain unchallenged, not a word was asked to be redacted, and Michael was never sued. It sits in the Harvard Law Library.