No Blood of Oil? A Lesson in Math�.
I was walking down Lexington Avenue in New York City yesterday, when I noticed a young woman with impossibly red hair sporting a button on her backpack that read: �No Blood for Oil�.
Apparently, my message hasn�t gotten out.
This war isn�t about Oil. I�ll even go so far as to concede that the first was certainly about Oil. If anything, this is a war to protect banks and insurance companies, but more on that later. Sure, some defense contractors will get a pop, but that was going to happen anyway.
No, this piece is written for those Who Still Don�t Get It (WSDGIs). So, for those who don�t believe, let me do the math for you.
The Math, Part 1
Saddam Hussien�s Iraq produces 2.5 million barrels of oil a day under the UN�s Oil for Food program. At $30 a barrel, that runs to about $75 billion or what President Bush has asked to fight this war if it only goes 30 days. If it goes longer � my guess is six weeks � then he�s going to need more cash. Assuming we confiscate the entire output, the US would need to pump for a year to pay for this. And this assumes two things: a) output doesn�t increase (it will, to pre-sanction levels of 4 million barrels per day), b) the price of oil stays at $30 a barrel (it won�t since volume will increase). If this conflict goes long � and bet that it will � you�re looking at several years production to pay for this adventure.
But we're not going to confiscate Iraq's entire oil output. No, we're just going to pay for it, like everyone else. Energy prices will dip, but only to where they were before Venezuela started cracking up. Unleaded at $1.20 a gallon is not why Mr. Bush jumped into this with both feet.
As capitalist and an entrepreneur, the risk is too long and payoff is to short. And the above assumptions are based on our confiscation of Iraq�s oil, something that no rational person believes will happen. No, like I said, we�ll buy it like everybody else, which negates the whole reason for going, if the reason is oil.
The Math, Part 2
No, if there is a beneficiary, it�s the banks and insurance companies invested in Manhattan real estate.
What? We�re attack Iraq to protect Manhattan real estate values? Yeah, if you're must have some nafarious conspriacy that stipulates that the only reason for a war is that some business somewhere must benefit, these are the ones.
Back in 2001, some terrorist mailed envelopes with weaponized anthrax to Sen. Tom Daschle. The cost to decontaminate the Hart office building was $42 million. Imagine now, if a pair of crazies toss a baby food jar of the same stuff in front of the Number 1 train on west side of Manhattan, and in front of the Number 4 train on the east side. The subways in New York vent to the sidewalk, so toxins would be distributed all over the city.
Thousands � maybe even millions � of people die. A lot of those people would have life insurance claims that would have to be pay off. If 50,000 people have $125K worth of insurance each, you�re talking about a $6 billion hit to the insurance industry. Sure, that�s big and scary enough, if you�re an actuary or a insurance exec. But that�s not the really scary part.
Commercial structures in Manhattan would be rendered uninhabitable and those business contained therein would be forced to flee. Rents would stop being paid. All those glorious skyscrapers could be standing empty.
In Manhattan, there is 353 million square feet of office space. At an average price of $35 per square foot (a very low estimate), that equates to $148 billion (with �B�) in rents. Now imagine all that space empty and needing de-contamination. The economic fallout would be cataclysmic. The note holders on those buildings � banks, REITs, insurance companies � would be left holding the bag and would no doubt default.
Now, if the Hart Senate Office Building cost $42 million to decontaminate, and it contains roughly 1 million square feet, how much will it cost to decontaminate Manhattan�s office space? If the same rates hold, the amount needed to pay for this is $14.8 billion (that�s with a �B�). Add that together with the several years worth of lost rents and you're talking about a hit to the economy that would make Sept 11 look like a speed bump.
And that�s just Manhattan commercial space. What about the residential hit? How long would those $8 million townhouses be worth $8 million dollars in a city as uninhabitable as Chernobyl? Factor in lost economic activity and you're talking about a 1 or 2 trillion (with a "T") dollar hit.
Look, I�m not one to second-guess the President�s motives. If he says this conflict is to liberate Iraq, get rid of Saddam and cleanse the country of WMDs, then so be it.
But don�t say it�s about Blood for Oil, because it�s not. That empty-headed manifestation of free speech used by those WSDGI is more than just wrong; it�s stupid and an insult to the intelligence of those of us who have done the math.
28 Mar 03 dpny
Friday, March 28, 2003
Wednesday, March 26, 2003
War �
I have to say this up front: I am amazed at the skill and precision that our combined fighting forces have exhibited during the opening of this conflict with Iraq. When you look at the massive numbers of Iraqi military casualties and contrast that with the Red Cross�s official number of civilian casualties, one can�t help but be impressed. God bless�em; they�re killing the bad guys without harming the spectators.
Now that we�ve hit a pause in the action � due to sandstorm � perhaps we should reflect back on why this action is very much different from Vietnam.
Oh, I�ve heard the litany from the usual suspects that this is exactly like Vietnam and that we�re going to get bogged down in a war of attrition with an intractable foe. The same nattering nabobs of negativism have been saying that very same thing every time America puts it�s military in harm�s way. They may have even been slightly correct in saying this about Gulf War I. Both were limited actions designed not with victory in mind, but restoration of the status quo ante bellum.
This conflict is different, and more closely resembles our actions in Europe during the middle of the last century. The as now, we are attempting to destroy a regime, killing or imprisoning all the major players and liberating a country from the clutches of a foul, dictatorial madman. It will only end with Saddam's head on a stick, not some convoluted peace treaty that lets him go. More than that, we�ve coupled this liberation / invasion with a massive humanitarian project that seeks to feed the Iraqi people at the same time. If those shameful clowns that run the Nobel Committee weren�t a bunch of socialist, America-hating Euro-weenies, they�d nominate George Bush for the Peace Prize, not that those mean all that much these days.
No, things are actually going well, despite all the doom and gloom from the BBC, CBC and Al Jeezera. Bryan Preston and Chris Regan for National Review Online put together a tick-tock that's as comprehensive as I can find anywhere on the net. Money passage:
Despite, what you hear on NPR, we do seem to be winning the war.
And it�s malcontents
I did happen to catch CNN�s coverage of war protest march in New York City this weekend. In general, I respect people right to say and believe foolish things. However, one �man in the street� interview really got to the bottom of why so many otherwise clearly thinking people are so violently opposed to overthrowing Saddam Hussien�s genocidal regime. The reporter, whose name I don�t remember (sorry, I�m usually better about that than most) asked a gray-haired, grandmotherly-type about her reasons for marching. She spouted off the usual left-wing pap � no blood for oil, etc � then she stated her real reason: George Bush wasn�t even �legitimately elected�.
I said this earlier: a huge percentage of the peacenik movement really just hates George Bush and still upset about Florida. These, of course, were the same people that wanted the Republicans to �move on� after the Monica-gate.
It�s sad, really. Here we are in a time of terrible tumult � Islamo-fascists attacking Americans on American soil in broad daylight and on national television � and all they care about is Al Gore losing an election on a technicality.
If this is the best the anti-war movement / Democratic party can come up with, they�ll be out of power for at least a generation.
And that�s not a bad thing either.
One good thing about the part 1....
Word has it that Tina Brown, ex-editor of Talk that abysmal, self-absorbed, celebrity-soaked journal of the Beautiful People, has had her show with CNBC delayed due to war coverage.
To quote Kilgore: someday, this war's gonna end.
27 Mar 03 dpny
I have to say this up front: I am amazed at the skill and precision that our combined fighting forces have exhibited during the opening of this conflict with Iraq. When you look at the massive numbers of Iraqi military casualties and contrast that with the Red Cross�s official number of civilian casualties, one can�t help but be impressed. God bless�em; they�re killing the bad guys without harming the spectators.
Now that we�ve hit a pause in the action � due to sandstorm � perhaps we should reflect back on why this action is very much different from Vietnam.
Oh, I�ve heard the litany from the usual suspects that this is exactly like Vietnam and that we�re going to get bogged down in a war of attrition with an intractable foe. The same nattering nabobs of negativism have been saying that very same thing every time America puts it�s military in harm�s way. They may have even been slightly correct in saying this about Gulf War I. Both were limited actions designed not with victory in mind, but restoration of the status quo ante bellum.
This conflict is different, and more closely resembles our actions in Europe during the middle of the last century. The as now, we are attempting to destroy a regime, killing or imprisoning all the major players and liberating a country from the clutches of a foul, dictatorial madman. It will only end with Saddam's head on a stick, not some convoluted peace treaty that lets him go. More than that, we�ve coupled this liberation / invasion with a massive humanitarian project that seeks to feed the Iraqi people at the same time. If those shameful clowns that run the Nobel Committee weren�t a bunch of socialist, America-hating Euro-weenies, they�d nominate George Bush for the Peace Prize, not that those mean all that much these days.
No, things are actually going well, despite all the doom and gloom from the BBC, CBC and Al Jeezera. Bryan Preston and Chris Regan for National Review Online put together a tick-tock that's as comprehensive as I can find anywhere on the net. Money passage:
To review the present reality: Of the 300,000 or so allied troops engaged in this conflict, to date fewer than two dozen have been killed, with another couple dozen injured and a handful taken prisoner by the enemy. U.S. casualties include one killed and another dozen injured when a fellow soldier "fragged" his own officers. The preponderance of British casualties have occurred in crashes, mechanical difficulties, and at least one friendly fire incident. The Iraqi regular forces have been thus far unable to mount any organized resistance, have lost control of most of their country and have already resorted to illegal tactics such as donning civilian clothing and faking surrenders before opening fire. Ten thousand of them, from the lowest private to a couple of generals, have already surrendered to allied forces and are reportedly providing intelligence on troop positions throughout Iraq. In all, these are not the acts of any army that expects victory, but is in fact merely trying to forestall inevitable destruction. U.S. Patriot missile batteries have thus far scored perfectly, knocking down each missile the Iraqis manage to lob at our rear positions in Kuwait. Each missile fired represents a desperate gasp from a regime slowly strangling from assault without and a lack of popular support within. Whether Saddam lives or not at the moment is incidental � his regime is dying.
Despite, what you hear on NPR, we do seem to be winning the war.
And it�s malcontents
I did happen to catch CNN�s coverage of war protest march in New York City this weekend. In general, I respect people right to say and believe foolish things. However, one �man in the street� interview really got to the bottom of why so many otherwise clearly thinking people are so violently opposed to overthrowing Saddam Hussien�s genocidal regime. The reporter, whose name I don�t remember (sorry, I�m usually better about that than most) asked a gray-haired, grandmotherly-type about her reasons for marching. She spouted off the usual left-wing pap � no blood for oil, etc � then she stated her real reason: George Bush wasn�t even �legitimately elected�.
I said this earlier: a huge percentage of the peacenik movement really just hates George Bush and still upset about Florida. These, of course, were the same people that wanted the Republicans to �move on� after the Monica-gate.
It�s sad, really. Here we are in a time of terrible tumult � Islamo-fascists attacking Americans on American soil in broad daylight and on national television � and all they care about is Al Gore losing an election on a technicality.
If this is the best the anti-war movement / Democratic party can come up with, they�ll be out of power for at least a generation.
And that�s not a bad thing either.
One good thing about the part 1....
Word has it that Tina Brown, ex-editor of Talk that abysmal, self-absorbed, celebrity-soaked journal of the Beautiful People, has had her show with CNBC delayed due to war coverage.
To quote Kilgore: someday, this war's gonna end.
27 Mar 03 dpny
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