The attack on Saudi’s oil installation

The recent attack on Saudi’s oil installation, was incredible with 5.7 million barrels of oil per day shut-in, roughly half of their oil production. For comparison the US produces about 12 million barrels per day.  So, economically, Saudi Arabia is losing 300 million dollars per day.  However, the New York Times reported that analysts who closely follow the Saudi oil industry, were hearing the damage to the facilities was not severe resulting in only a few day’s outage,  This sounds like some of the shutdown was really just a precaution.   The oil analysts are predicting a rise in oil prices when trading begins Sunday (September 15) night, likely to change quickly as engineers assess the damage.  Spot oil prices in the next week will be a reflection of how long until Saudi production is restored.

The question is, right now, who did this?  The Houthi’s are claiming responsibility for the drone attack, yet the Mike Pompeo, US Secretary of State, claims it was Iran.   I beginning to get the idea that the US just doesn’t know where the drones came from, and Iran seemed a convenient culprit.  The US is not taking this to the UN Security Council, which would be the obvious place to begin to show all that we know.   Pompeo did not say that the drones were sent from Iran, just that they were responsible for the attack.

The attack took place 500 miles from Yemen.   UN investigators have reported that the Houthi’s had drones capable with a range of 930 miles.  The Houthi’s said the attack was done by 10 drones.

The current war in Yemen began in 2015, and the civilian losses due to war or starvation have been terrible.  It is a proxy war, with Saudi Arabia and the US helping the Yemen government with aerial bombing and Iran’s support of the Houthis.    There are excellent summaries of the conflict on Wikipedia.

I think Trump is looking for a pretext to attack Iran.  Also, he has no problem of supplying Saudi Arabia with a pretext to attack Iran.  It also makes no sense that, given the current conflicts between the US and Iran, that Iran would be involved in an attack on Saudi Arabia.   Iran is suffering economically due to the sanctions imposed by Trump.  It is desperately trying to convince the rest of our allies not to be pressured by the US in extending these sanctions.

Stay tuned,

Dave

Links:

Houthi Movement

 

 

 

 

Weaker alone and it’s getting worse (China, Iran, Climate Change) + Over the top distractions

Trump has started a number of highly disruptive “wars” without a clear end in sight.  The two big ones is his economic war with China and the political war with Iran.   A third huge division among us and our allies is our recent action against international cooperation in climate change.  Our Department of Justice is currently waging war against our automobile manufacturers who are working with California to improve exhaust emissions standards.  I guess the idea is that we all must breathe the same polluted air.   I’ll leave this last one for separate blog.

— Trade War – No end in sight.

The trade war with China, just seems to get worse every month.  According to experts, China has engaged in unfair trade practices.  But, the current trade wars are just the US and China.  We failed to obtain international support.  We created the World Trade Organization to address issues such as unfair trade practices and currency manipulation.  Now we take action without their involvement.  Trump pulled out of the Trans-Pacific Partnership Agreement (TPPA) which included 12 countries (China not one of them) and would have been the best counter measure against China’s unfair practices.  Trump has correctly stated that prominent Republicans and Democrats were against it.   Likely, if Clinton were elected president, then she would have attempted to make  changes in the agreement.

The TPP agreement is long and complex.  It has survived without the US in a new agreement, the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP).   The US was insisting on certain provisions which would be best for the US. and none of the other countries before we signed it.  See links below.  When Trump pulled out, all the contested provisions were pulled out.  It includes however, what seems at the top of Trump’s wish list – respect for intellectual property as follows:

It [CPTTP] includes the most detailed standards for intellectual property of any trade agreement, as well as protections against intellectual property theft against corporations operating abroad.

Manufacturing as measured by the US ISM manufacturing employment index, last month hit a two year low of  47.4 in August 2019, down from a high of 60.17 on September 2017.  See link.

Trade wars are a lose-lose proposition.   There are 18 countries which are party to the CPTPP agreement including Japan, Mexico, Australia, Singapore and Canada.  They are stronger together, and the US is now weaker as it stands alone.

—  IRAN

Now Iran.  As long as the sanctions were lifted, Iran obeyed by its commitments.  They had a strict monitoring program.  The agreement basically called for the US to lift sanctions as long as Iran was in compliance.  When Trump imposed economic sanctions by refusing to import oil from Iran, it put the US in violation of the agreement.  Further, the US was pressuring other countries and companies not to lift Iran’s oil.

Thus, Iran correctly stated that they had the right not to be bound by the terms of the agreement, primarily on the amount of uranium it could enrich.   None of our European allies want Iran to get nuclear weapons, so they are pleading with the US, to drop the sanctions, so Iran can be brought back into compliance.  President Macron is leading this effort.  The head of the UN atomic energy watchdog agency (IAEA)  is in Iran now,   Iran makes no secret of its violations of the treaty and in fact will comply with thorough IAEA inspections,   It is simply tit-for-tat against actions taken by the US.

Trump’s theory, that once Iran felt the pain of sanctions, it would do anything to please the US hasn’t worked at all.  In fact, it has been a terrible failure.   Treaties are tough to put together, but much easier to fall apart.

I’ll stop here.  I’ve got a lot more to say on Trump’s misguided policies on reducing our carbon emissions and minimizing the real threat it is creating throughout the world, including droughts and extreme weather events.  But that will be a separate blog.

— DISTRACTIONS

I have to contend with a huge number of distracting events in July and August.  It’s really nuts.  Vice President Mike Pence wants an American on Mars by 2024, about 6 years earlier than planned, price tag around 500 billion dollars (a trillion here and there eventually adds up to real money) plus the militarizing of space with the Star Wars themed “Space Force.”   Then the trip to Ireland, was a publicist nightmare.  His grandfather was Irish, but he fled Ireland as a refugee escaping violence and poverty, just the folks Trump is trying to ban from the US.  Plus,  it was a terrible snub to stay at the Trump hotel, far outside of Dublin, for “security reasons.”  Nobody bought this one.   See link.

What else:  Trying somehow link Bill Clinton and Jeff Epstein by repeating social media nonsense,  buying Greenland and insulting Denmark (whose next?), the Trump drawn hurricane maps to include Alabama, pulling funds for Puerto Rico hurricane rebuilding effort to build the Mexican border wall (seeing just how far the National Emergency Act can be stretched), and a barrage of tweet attacks against Jay Powell for basing his decisions on interest rates on economic data and Fed Reserve objectives, rather than Trump’s polling numbers.  Remember, Jay Powell was Trump’s nominee to the Fed and highly qualified for this position by both Democrats and Republicans.

I’m not sure if any of the above means much. Our policies on Iran, China and Climate Change are real issues where an immediate course correction is necessary.  More like 180 degree turn, as we are “stronger together.” This will have to wait until the 2020 elections.

Stay tuned,

Dave

Links:

Manufacturing Unemployment index is down

Wikipedia: Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP)

Atomic watchdog chief in Iran for high-level talks

The distractions:

Mars Confusion 

Pence’s disasterous trip abroad

The Irish love anyone who can drink beer and has a bit of Irish heritage.  I believe they’ll make an exception with VP Mike Pence.

Irish Times Review of Mike Pence’s visit

 

 

 

 

 

War of Words

“I’m not going to enter a war of words with anybody, including the American president,” Denmark’s prime minister, Mette Frederiksen, told a Danish television channel on Wednesday.  Ok, that’s right.  Don’t back down and don’t escalate,

A few days ago, I was already to post a slightly humorous comment on Greenland, saying the Prime Minister should have told Trump, “Well, if you want Greenland, then give us Puerto Rico. ”  That was going to be my joke.  Then, it came out that the White House actually discussed swapping Puerto Rico for Greenland.   That’s super crazy.

Buying Greenland was a crazy distraction.  The Prime Minister of Denmark,  Mette Frederiksen, was absolutely right to call the idea “absurd.”   Even more absurd is the cavalier way Trump proposed this.   Trump was right that this had been considered during Truman’s presidency in 1946.   But, this was done under tight security, and no one knew about it for 45 years, when it was discovered by a Copenhagen newspaper in declassified documents in the National Archives.

Today, we have a military base (Thule air base) on Greenland.   Denmark has been a strong ally of the US.  Danes have fought with the US in Iraq, Syria and Afghanistan.    However, unlike Trump,  the Prime Minister is a strong environmentalist, and Denmark is making great strides in reducing carbon emissions.  It would be hard not to be a strong believer in climate change, as it is so evident in Europe and of course, in Greenland.

So, Trump hopped into Air Force 1, to attend the G7 meeting in beautiful Biarritz, France where the hot issues will be Iran, trade issues and climate change.

On climate change,  President Bolsonaro  of Brazil in making his country  great again, has done great harm to the Amazon.  I warned this was going to happen.   The people who voted for him are now choking on smoke in Sao Paulo.    Donald Trump intensified the Trade War, not only with China but with our European allies.  EU is trying desperately to save the Iran Nuclear agreement, after the US pulled out.

So, the G7 meeting will be a “war of words”  with the US now more as  the trouble maker than the problem solver.

Stay tuned,

Dave

Links:

https://www.washingtonpost.com/nation/2019/08/16/trump-greenland-purchase-harry-truman-denmark/

A Lose-Lose Strategy for Iran

The Iran Nuclear Deal was a great milestone in international cooperation with one single goal – Iran should not be able to develop nuclear weapons in for the foreseeable future.   The deal required Iran to limit its stockpile of uranium, to levels determined to be insufficient to develop a nuclear weapon.  It would be subject to the most thorough monitoring of its uranium enrichment.   The monitoring would be done by an international group of experts (IAEA).   In exchange, the US and its allies would lift the harsh sanctions leveled against Iran.

The Iran Nuclear Deal was agreed to by China, France, Germany, Russia, UK, US and the EU.  The sanctions imposed not only created hardships for Iran but for our allies as well.  John Kerry and other negotiators worked diligently to kept the coalition of our allies  together, so the pressure would be on until a verifiable means of keeping Iran from developing a nuclear weapon was achieved. The Republicans, including Donald Trump, were constantly on the attack against the deal.  Trump vowed to scrap this deal, reimpose sanctions and then renegotiate a new deal, which would fully satisfy the US interests.  The problem of course, was the Iranians were in compliance with the deal and for us to unilaterally pull out would be a breach of international law.   It had been approved by both the US Congress and the UN Security Council.

However,  Trump made it clear that there had to be a new deal, and sanctions against Iran was the only way this was going to happen.   The most important sanction was a refusal to buy any oil from Iran or do any business with Iran.  Further, he anticipated other countries would do the same, and force Iran back to the negotiating table, for the “Trump Iranian Deal.”   Israel and Saudi Arabia (and other Gulf coast countries) would simply like to a US invasion of Iran.  No other signatory countries felt re-imposition of sanctions was necessary, because Iran was living up to its part of the deal.  They refused to re-open the negotiations with the Trump administration because they were living up to their side of the bargain.   They insisted that if the US continued in non-compliance with the JCPOA, they too were no longer bound to the agreement.

Today, July 1, 2019, Iran finally pushed back against the US.  Re Wikipedia:  “On 1 July 2019, Iran announced that it had breached the limit set on its stockpile of low-enriched uranium. Shortly after the announcement the IAEA confirmed that Iran’s total enriched uranium stockpile exceeded the deal’s limit.”   We have no diplomatic recourse.  We lost our place at the negotiating table when we violated the deal and re-imposed sanctions.  The fear was that Iran was not a country to be trusted and they would develop secret uranium enrichment plants out of sight of inspectors.  Just the opposite has happened.  They have breached the agreement in full view of inspectors in retaliation for the US violation of the agreement and our pressuring of other countries to cease doing business with Iran, or we will level sanctions against them.

We have embarked on a horrible lose-lose strategy.   This was not “denuclearization” because Iran does not possess a nuclear weapon.  This was to keep them from doing so, even though many Iranian would like to be a part of the nuclear club.  The deal was good not just for the US but for the rest of the world.   If one believed that the future of Iran was hell bent on assisting terrorist organizations, then this deal was extremely important to keep nuclear weapons out of Iran.   Trump has not had one meeting with Iran since he came to office.  My only hope is that in 2020, with a new president, we can once again, lift the sanctions, and they will return to the deal.  But honestly, if this escalates, all bets are off.

Stay tuned,

Dave

Links:

Wikipedia: JCPOA:  Joint Comprehensive Plan of Action

 

 

Weaker Apart

Hillary Clinton’s campaign had a simple slogan, just like Trump’s campaign.  It was “Stronger Together”  and I’ve turned it to the negative, “Weaker Apart.”    I am referring to actions by the Trump administration to breach or terminate any multinational agreement which it perceives is not in the best interest of the US.   Trump likes to think of himself as this incredibly skilled negotiator who can be get better deals usually on a bilateral basis.

I don’t see a global approach to problems as an option, but rather as a necessity.   We don’t solve nuclear proliferation, climate change or fair trade (Trump’s biggest concern)  on our own.   Unilateral sanctions on countries whom we have disagreements (Cuba, Venezuela, North Korea, Iran, to name a few)  are generally failures.

I commented before on how confused Trump’s policies were China, seeking their help in pressuring North Korea to denuclearize and simultaneously attacking them as a currency manipulator and promoting unfair trade practices. Secretary of State last visit to China, failed for exactly these reasons – see New York Times article.

Getting tough on Iran with new sanctions is also backfiring.  It has created a sort of odd unity between EU leaders and Iran, that desperately wants to keep the Iran accords alive as this provides constant monitoring of Iran’s uranium enrichment sites.   Meanwhile Minister of Foreign Affairs, Mohammad Javad Zarif,  in an interview with CNN Fareed Zakaria,  is not following Trump’s game plan of high level meetings to work out a new accord.  He rightly says that the accord took years to reach, and was comprehensive covering uranium enrichment, reprocessing, monitoring and sanction relief.   The International Atomic Energy Agency was given full access to Iran’s nuclear facilities and confirmed Iran has been in compliance.   Zarif pointed out there is no sense in sitting down with the US to work out a new agreement, when they are presently in violation of the existing accord.   Having the two leaders meet at this point, would just be a PR “photo shoot.”

Perhaps there is no area that is so clearly a global problem and costly to the US than climate change.   The Paris Accords was,  to most environmentalists, a weak plan as each government could set their own goals to reducing carbon emissions.  But it was an incredible achievement, nevertheless to have each country acknowledge the need for positive action to reduce their carbon emissions.   The proposed rollback of car mileage standards, means more gas will be consumed in each car, and more carbon emissions.   Americans will foot the bill, not only paying more for gasoline but also in health related problems.  This impacts around 25 million asthma suffers.

I have provided a link below on likely battle which will ensue over the EPA rules change on  car emissions.  US car emission standards will be lowered below California’s emission standard, setting off another court challenge.   Republicans, who traditionally support the states in these issues, will suddenly now be on the side of Trump and his business friendly EPA.   See links.

Global warming does not create hot weather, every day of the week.   Instead, it makes extreme weather events more likely.  The hurricanes may not be more frequent with global warming, but they are likely to be more laden with water, and have time to intensity.  In time, storm surge will increase due to rising sea levels.   The result is more flooding,  the really destructive part of hurricanes in terms of human injury and death.

A comment from Christine Whitman, former EPA administrator under George W. Bush.

“There’s not an ideological push here, there’s just, ‘We’re going to do whatever industry wants, and if Obama did anything, it’s bad and we’ll undo it,’” Christine Todd Whitman, the EPA administrator under former President George W. Bush from 2001 to 2003, said in a phone interview. “I don’t think the president has thought through what used to be a basic principle of Republicans, and that’s states’ rights.”

Christine Whitman is a lifetime Republican,  who recognizes the need for clean air and water is not a political matter.

The efforts of the Trump administration are not making America Great, it is giving in to polluters, and rejecting the international cooperative effort.

So.  why are we weaker apart?   Increase inflation due to trade wars with China,  increase danger of a nuclear  arms in Iran, as a result of our breaking the Accord,  increase gas costs as we attempt to force Iran to the negotiating table, and sadly, more carbon emissions, which we will pay for with cars that get fewer miles to the gallon.

Not great,  In the long term  just dumb.  Regaining our leadership role in the world might have a change in 2020, with a new leader.

Stay tuned,

Dave

Links:

Kerry says Trump’s Iran strategy ‘very dangerous and ill-advised’

Iran Widens an Already Huge Rift Between Europe and U.S.

Trump’s Assault On Auto Pollution Rules Is The Latest Salvo In A War On States’ Rights

Trump Fuel Efficiency Proposal Is Attack on Global Climate and States’ Rights, Critics Say

Christine Todd Whitman

Global Warming and Hurricanes

Note:  I believe I’ve correctly summarized their findings.   The article is primarily on Atlantic hurricanes.   Typhoon Mangkhut was a terrible storm, and the death count (~80) will likely increase as recovery efforts are underway.   Many more people die after a typhoon or hurricane than during one.

How climate change could cause more mega-storms like Super Typhoon Mangkhut and Hurricane Florence

US-North Korea Summit Cancelation

Trump may uncancel the Summit.   But when he did cancel it, he wanted to make sure to point the blame at North Korea.  At least, that is what President Trump wanted to hear from other world leaders.   And of course, none of them are saying this.

President Moon of South Korea, said the cancellation of the Summit was regrettable.  Others have said leaders in Seoul are perplexed.

It was Churchill’s famous quote,  “To jaw-jaw is always  better than war-war.”  If history has shown us anything, it is that long term enemies can first learn to co-exist, and then become friends.  It doesn’t happen overnight.  Animosity doesn’t have to end in bloodshed.

Nobody really knew how the planned summit was going to turn out.    Many experts on North Korea seemed surprised at Kim Jong Un  sudden  willingness to seek some kind of discussion on nuclear disarmament and reconciliation with South Korea after showing so much hostility and threats mainly to the US.    From their perspective,  they were achieving parity with South Korea, which they consider to be a nuclear power, given the strong military  support from the US.

Certainly,  much of the credit for bringing North Korea  leader to the summit goes to  the  newly elected South Korean President Moon Joe-in.    The invitation by President Moon to the Olympic games was the first real diplomatic outreach.   This was followed by the inter-Korean summit, in April 27, 2018, which was the first summit in eleven years, and the first time President Moon and Chairman Kim have met in person.

The cancellation seems outright weird and dumb.   Weird is the right word, because it has to do with an exchange of words between Vice President Pence that North Korea could end up like Libya (North Korea could follow the Libyan model)  really made no sense.    This weird Libyan comment started with John Bolton, then Donald Trump and then Pence said the same thing.    The leader of Libya was killed in 2011 by his own people in the city of Sirte,  during the Libyan civil war.   However, there was covert aerial support by NATO including the US  in spotting the convoy that Qaddafi was in.

The actions taken by the US and our European allies, in support of the Libyan civil war, have nothing in common with nuclear disarmament.    Qaddafi had already given up his nuclear program and dismantled terrorist training sites in 2003.  The Bush administration took Libya off of the list of  state sponsored supporters of terrorism.   This was an enormous help to the Qaddafi regime.  Many (including myself) believe Qaddafi did this for economic reasons.    I also believed he was becoming more worried about unrest in eastern part of the country, centered around Benghazi, as a potential future threat.  Benghazi is where the first hostilities broke out in 2011.

The intervention in Libya occurred after UN Resolution 1973 (17-Mar-2011) during the Obama administration, was presumably to protect civilian lives.  At the time, it was highly likely that Qaddafi would have bombed Benghazi and other cities which were rebelling against his authority.   If he had bombed Benghazi, a city with a population of over 600,000 inhabitants, the death toll would have been enormous.  Putin and others were highly critical of the US implementation of the Resolution, as we used it as a rationale to bomb Qaddafi’s compound in Tripoli, late in 2011.

Many consider Hillary Clinton’s support of the intervention in Libya, and demonstrations against Putin in Moscow 2011 as the reason for Russia’s interference in US elections in 2016.   The Arab Spring uprisings were against many autocratic regimes, including the Russian government.

The aftermath of the civil war and  Libya’s “Arab Spring” rebellion, is a long drawn out disaster, and none of relates to North Korea.   I think the only fair take away message from Libya, is that the outcome of intervention, can be very unpredictable.

Perhaps what is so obvious to the North Korean regime, is the “Iran Model”  where the US unilaterally pulled out of a nuclear disarmament deal, even though Iran was in compliance.

The day the talks were cancelled, the New York Times printed a story, about how China would likely be the greatest beneficiary as more acceptance of North Korea with other countries, is not in their game plan.

Diplomacy requires careful driving, and a clear focus on acceptable outcomes.   Mike Pence following John Bolton’s inflammatory rhetoric is the quickest way to veer off the road and slam into a telephone pole.

Stay tuned,

Dave

 

 

 

 

Iran Nuclear Deal

It is likely that Donald Trump will pull out of the Iranian nuclear deal on May 12, just 5 days from today.  The deal was not perfect by any one’s standards, but the flaws were blown way out of proportions by Republicans in Congress.   Trump has used this, and almost everything else negotiated by Obama (and other presidents) as terrible.   The response from Iran is unknown to the US pullout.  Our allies, France, Germany and the UK, have all been trying to keep Trump in the agreement.

The deal is working and Iran is in compliance.    Only  Benjamin Netanyahu,  the president of Israel, is against the agreement.   It will impact our negotiations with North Korea, who will see the US as a country which can not be trusted.   One president makes deals and the next one breaks  the deal when the other side is in compliance.

I hope I’m wrong.  If not, I would list this as the worst decision of the Trump administration,  followed by the pull out of Paris Climate Accords.  The third on the list, is the very brazen efforts by  EPA Director, Scott Pruitt, and Interior Department Secretary, Ryan Zinke,  not to protect  the environment or the interior, but to let the fossil fuel companies to do what they want, in the guise of deregulation. I believe the EPA should be changed to EDA, or Environment Destruction Agency.   As long as I’m criticizing Trump’s appointees,  this last one, John Bolton, as National Security Adviser, would be best described as the person most capable of turning a small problem into a larger one, through inflammatory rhetoric.

I won’t go into any more details on the Iran Deal, as there is a lot of commentary on the Internet.  I’ve included a link from Wikipedia below.

Stay tuned,

Dave

Link:

Joint Comprehensive Plan of Action