Today's Stories

June 24, 2008

Ishmael Reed
Obama: the Big Let Down

June 23, 2008

Michael Hudson
How Should the Middle East Invest Its Oil Profits?

John Ross
Killing Farmers with Killer Seeds

Peter Montague
Environmental Enron: the Clean Coal Con

Ramzy Baroud
Gaza's Dying Children

Robert Fantina
McCain, Racism and the Supreme Court

Robert Weitzel
A MAD Foreign Policy: America's Irrational Defense of Israel

David Macaray
The Supreme Court's Hostility to Organized Labor

Howard Lisnoff
Where's the Anger?

Richard Rhames
Grieving Mr. Gotcha: Russert, GE and Neutron Jack

Gail Dines
Penn, Porn and Me

Tim Matson
Bright Ideas for Storms and Blackouts

June 21 / 22, 2008

Alexander Cockburn
The Russert Send-Off

Jeffrey St. Clair
Adventures in the Endangered Skin Trade

Pam Martens
A Secret Oil Gusher Inside Citigroup

Mike Whitney
The Game is Over: an Interview with Michael Hudson on the Economy

Chris Floyd
Torturegate

Tim Wise
The Ugly Side of Disaster: Katrina and the Midwest Floods

Paul Craig Roberts
A Totally Lawless Regime

Michael Winship
How Countrywide Leveraged Washington

Ron Jacobs
Vietnam Blues

Ramzy Baroud
Palestine in the American Imagination

Alan Farago
The Off-Shore Drilling Scam

Michael Yates
Paul Krugman on Race: Ignorant and Disingenuous

Dave Lindorff
Keeping America Safe: Prosecuting Children as Terrorists

Bernard Chazelle
Why Israel Won't Accept a Two-State Solution

Linda Mamoun
Mearsheimer and Walt in Tel Aviv

Jo-Shing Yang
Dying of Hunger, Dying of Thirst

Robert Jensen
Fear and Hope on a Runaway Train

Website of the Weekend
Slavery By Another Name

June 20, 2008

Robert Oscar Lopez
Brownout in Black Camelot: Obama and Latino Voters

Paul Craig Roberts
John Yoo, Totalitarian

Bouthaina Shaaban
The Real Arab AIPAC

Bill Quigley
The Big Lock-Up

Moshe Adler
Is Cuba Done With Equality?

Patrick Cockburn
An End to Iraq Contractor Immunity?

Andy Worthington
John McCain, Torture Puppet

Norman Solomon
Health Care and the Ghosts of War

Martha Rosenberg
Can Wyeth Fool American Women Twice?

June 19, 2008

Ralph Nader
Why Won't Corporations Take On Big Oil?

Chellis Glendinning
Techno-Fascism: Every Move You Make

Neve Gordon
Learning to Drive in Rafah

Dave Lindorff
Killing the News in Iraq

Sheldon Richman
Habeas Corpus Saved--Barely

George Bisharat
Obama's Missteps

Jackie Corr
Dear Mr. Kilowatt

Farzana Versey
Will Gorkhaland Become a Reality?

Website of the Day
Trouble on the Range

June 18, 2008

Nicole Colson
Hunger and Humiliation in the Belt-Tightening Economy

Rev. William E. Alberts
The "F" Word and the White Press

Vijay Prashad
Obama's Genuflections to the Swing Lobby

Parvez Ahmed
Oil Prices, Market Regulation and the Election

Bob Moss
Judicial Warfare in Boumediene

Dave Lindorff
The Elephant in the Room

David Wilson
Bush in London

June 17, 2008

Conn Hallinan
The Brain Trauma Vets

Wajahat Ali
Chomsky Speaks: On Iran and Iraq

Marjorie Cohn
Reviving Habeas Corpus

Uri Avnery
Two Professors: Mearsheimer and Walt in Israel

David Macaray
Adversarial Relationship

Rannie Amiri
Forgotten Lives in a Forgotten War

Website of the Day
Pentagon Money

June 16, 2008

Uri Avnery
An Apology

Corey D. B. Walker
The Racial Politics of Symbols

Howard Lisnoff
Files Upon Files

Dennis Loo
2008 Elections: Of Whales and Worms

Paul Craig Roberts
Obama and the Fall Into Tyranny

June 13 / 15, 2008

Douglas Valentine
McCain: War Hero or Go-To Collaborator?

Alexander Cockburn
Change, What Change?

Jeffrey St. Clair
The Politics of Timber Theft

Peter Linebaugh
On Wat Tyler Day

Ishmael Reed
The Colossus: Sonny Rollins, Take One

Joe Bageant
Old Dogs and Hard Time

Harry Browne
Ireland Shows the Way!

Andy Worthington
The Supreme Court's Gitmo Decision: What Does It Mean?

Jeff Sharlet
The F-Word

Binoy Kampmark
They Gassed Us: Agent Orange in OZ

Alan Farago
His Little Piece of the Pie

Brian Cloughley
America the Detested: the Pakistan Airstrikes

Manuel Garcia, Jr.
How to Stretch Gasoline

Reza Fiyouzat
Oil and Racism

Patrick Bond /
Richard Kamidza
How Europe Underdevelops Africa

David Yearsley
Music in the Rubble

Niranjan Ramakrishnan
Thank You, Dennis Kucinich!

Ronnie Cummins
Don't Panic; Go Organic

Dan Bacher
Bush Tries to Raid Salmon Disaster Funds

Michael Dickinson
Jesus in Megiddo Prison

Seth Sandronsky
My Father's World

Poets' Basement
Tu Fu / Rexroth

Website of the Weekend
Torture and the American Psyche

June 12, 2008

Judith Levine
As Cranes Fall and People Die

Patrick Cockburn
Amid Iraqi Fury, U.S. Offers Concessions on Military Bases

Saul Landau
The Iraq War Becomes Suicidal

Christopher Brauchli
Bush Bling-Bling: Government by Crony

Norman Solomon
Deadly Diplomacy

Helen Redmond
Why Can't We All Get KennedyCare?

Laura Carlsen
No Rest for the Working Poor

Jeremy R. Hammond
Threats Against Iran Escalate

Anne Landman
Pinkwashing: Can Shopping Cure Breast Cancer?

Website of the Day
Fire in Watts

June 11, 2008

Paul Craig Roberts
Why Oil Prices Are So High

Ralph Nader
Wall Street Gamblers

Joshua Frank
Why I Can't Support Barack Obama

Clifton Ross
Conversation in Miami: the Neoliberal Left and Socialism

Muhammad Idrees Ahmad
Whatever Happened to "Democracy Now?"

Stephen Lendman
Exposing Pentagon and CIA Corruption

Diane Farsetta
Talking Back to Bill O'Reilly

Ron Jacobs
The Sixties Painted Black

Deborah Rich
Hay Belly Nation: the FDA and the O-Word

Hop Wechsler
A Friend of Women? My Bill Clinton ... and Ours

Website of the Day
A New Path to the Waterfall

June 10, 2008

Alan Farago
John McCain and the Company He Keeps

James G. Abourezk
Deadly Fallout From Obama's Groveling Before Israel Lobby

Saree Makdisi
Banned in the U.S.A. (Almost)

Malini Johar Schueller
A Picture From Beirut

John Ross
Killing Foods, Killing People

Wajahat Ali
Rumi and Sufism

Peter Morici
Bernanke Aggravates Recession Risks

Jordan Flaherty
Inside Angola Prison, Louisiana's Last Slave Plantation

Gary Macfarlane
Collaboration on the Clearwater: Is It Legitimate?

Joanne Mariner
The Gitmo Trials: an Inglorious Start

Website of the Day
The End of the Clinton Machine?

June 9, 2008

Uri Avnery
No, I Can't: Obama, Israel and AIPAC

Nikolas Kozloff
McCain & the Republican Insitute: Promoting Iraqi Occupation for "a Million Years"

Allan Nairn
Drawing Your Last Breath Hungry

Dennis Loo
Threats on Iran and the "Batterer's Defense"

Harry Browne
Irish Euro Vote Comes Down to the Wire

C. Hand
U. S. Bid to Hike Iran's Gas Prices Seems Doomed

Peter Morici
An Unsustainable Trade Deficit

Kenneth Couesbouc
A Ripe Time for Inflation

Martha Rosenberg
The Inconvenient Senator Grassley

James L. Secor
Chinese Superstition or Unconscious Oracle?

Website of the Day
Pay Bo Diddley!

June 7 / 8, 2008

Alexander Cockburn
Obama Goes Over the Top

Ishmael Reed
How Miles Davis Changed My Life

Jeffrey St. Clair
What a Miner's Life is Worth

Nikolas Kozloff
Meet the King the Beers: John McCain and Latin America

Dave Lindorff
The High Cost of a Single War-Like Remark: Oil Prices, Israel, Iran and the U.S.

Robert Fantina
When Truth is the Casualty

Conn Hallinan
Iran and Rumors of War

Neve Gordon
The Occupation and the Politics of Death

Tom Barry
The Deterrence Strategy of Homeland Security

Patrick Irelan
Raiding the Packing House

Tim Wise
Your Whiteness is Showing

David Ker Thomson
The Hard Question

Joshua Frank
"Socialist" Wins Republican Nomination in Montana

David Yearsley
Disaster Music

James T. Phillips
1968: Year of the Rat

Joe Allen
The Real Bobby Kennedy

P. Sainath
Making Life Brighter in Kondapur

David Macaray
Should Unions be More Democratic?

B.R. Gowani
Experience and the Two-for-One

Fred Gardner
What Happened (at the DA's Office)

Peter Harley
Technology to the Rescue? Kurzweil and the Human Machines

Michael Dickinson
Surrender the Bones of Geronimo!

Jen Roesch
Where are the Real Women in Sex and the City?

Poets' Basement
Gibbons, Landau, and Buknatski

Website of the Day
Partying with the Waltons

June 6, 2008

Frank Barat
An Interview with Ilan Pappé and Noam Chomsky on the Future of Israel / Palestine

Patrick Cockburn
U.S. Extorts Iraq to Approve Military Deal

Gary Leupp
Cheney Enrages Iraqis Over Security Deal

James Abourezk
Name That Terrorist

Peter Morici
Recession Grips the Jobs Market

Faheem Hussain
What is NATO Doing in Afghanistan?

Andy Worthington
Guantánamo's Britons Go on Hunger Strike

Ayesha Ijaz Khan
How Will Musharraf Go? Impeachment or Safe Exit?

Dave Lindorff
Congress Needs to Defend Itself

Website of the Day
Backstage with Bo Diddley

June 5, 2008

Patrick Cockburn
Bush's Secret Deal Would Ensure Permanent U.S. Occupation of Iraq

Sharon Smith
Hillary's Wreckage

Nikolas Kozloff
Obama's Electoral Dilemma: Latinos or Reagan Democrats?

Linn Washington, Jr.
Police Brutality and Cover-Up in Philly

Omar Barghouti
60 Years of Nakba, 41 Years of Occupation ...

Scott Pellegrino
Jim Crow Radio: Bob Grant's Lifetime Achievement Award

John Walsh
Obama Woos AIPAC

Dan Bacher
The Parching of California

DC Larson
Nazi Rockers ... F-Off

Robert Jensen
Masculine, Feminine or Human?

Website of the Day
Ohio Cops Attack Long Walkers

June 4, 2008

Eric Walberg
Princess Patricia and the Taliban

Gary Leupp
Iran and EFPs: Chronology of a Lie

Ralph Nader
Disenfranchised Youth

Dave Lindorff
Of Whiners and Poor Losers

George Wuerthner
Farm Economics

Victor M. Rodriguez
The Puzzle of Race and Politics

Remi Kanazi
Why a Cultural Boycott of Israel is Needed

Stephane Luçon
Renault's Romanian Fairyland Suspended

Farzana Versey
The Tablighi Jamaat Movement

Laray Polk
The Militarization of Space

Website of the Day
Red State Rebels

June 3, 2008

Paul Craig Roberts /
Lawrence M. Stratton
Legislating Tyranny

Mike Whitney
The Withering Economy

Steve Early
San Juan Showdown

Manuel Otero
Why Hillary Won Puerto Rico: the View from the Colony

George Bisharat
The Hope of a Victimized People

Nikolas Kozloff
Obama's VP Quandry

Dan Bacher
Death on the Salmon Highway

Website of the Day
Censoring Bill Knott?

June 2, 2008

Uri Avnery
The Olmert Scandal

Nikolas Kozloff
Obama's Latino Problem Getting Worse

Allan J. Lichtman
Revisionist History: Bush, Borah and Hitler

Malini Johar Schueller
The Color of Randomness: Returning to the US From Beirut Via Syria

Robert Weissman
What's Driving Skyrocketing Oil Prices?

Peter Morici
Bailing Out Wall Street

Manuel Garcia, Jr.
Don't Get Burned: How to Protect Yourself From Raytheon's Pain Gun

John Ross
Celebrating Catholic Fanaticism in Mexico

Ahmad Al-Akhras
Encounters with the Watch List

Website of the Day
Man on Earth

May 31 / June 1, 2008

Alexander Cockburn
The Worst is Yet to Come

Jeffrey St. Clair
Arkansas Bloodsuckers

Gary Leupp
How McClellan Prettifies Bush

Stan Cox
Broken Agriculture

Rannie Amiri
Lebanon: the Domino That Wouldn't Fall

P. Sainath
A Guaranteed Day's Work--in the Fields, at 110 Degrees, for $2 a Day

Binoy Kampmark
Going Bankrupt in Vallejo

Robert Fantina
Bush, Rice and McClellan

Seth Sandronsky
Will There be Water Riots, as Sacramento Goes Dry?

Corporate Crime Reporter
Death Penalty for Bush?

Anthony DiMaggio
Gaming the Ghetto: Grand Theft Auto IV, Racist Media and the Concrete Jungle

Karl Grossman
A Half-Trillion for Nukes

Matt Reichel
From Vegas to the Heartland and Back Again

Paul Myron Hillier
Of Gas and God

Andy Worthington
Suicide at Guantánamo

David Yearsley
And the Winner is ... Wayne Shorter

Daniel Cassidy
Free Lunch

Charles Thomson
If Hitler Had Been a Hippy ...

Gary Corseri
A Dream Deferred: Activism and the Arts

Wajahat Ali
Sex and the City Through a Man's Eyes

Ron Jacobs
Robins Weep

Poets' Basement
McNeill and Davies

Website of the Day
Last Charge of the Light Horse

May 30, 2008

Bassam Aramin
Here's the Truth You've Been Running From

Andrew Cockburn
Petraeus' Iran Obsession

Saul Landau
How We Got Into This Mess

Nikolas Kozloff
Meet South America's New Secessionists

Robert Sandels
Turning Back the Clock on Cuba

Dave Lindorff
Talk is Cheap

Martha Rosenberg
Raiding Big Meat; Arresting the Wrong People

Harvey Wasserman
Lieberman & McCain: Linking Internet Censorship and Atomic Reactor Terror

Doug Giebel
A Plague on Both Your Houses (of Congress)

Shaun Harkin
The Trial of the Raytheon 9

Website of the Day
The Once and Future Environmental Movement

May 29, 2008

Jeffrey St. Clair
Bill Clinton and the Rich Women

Nikolas Kozloff
Puerto Rico, Obama and the Politics of Race

Col. Dan Smith
Deceiving the Dead

Karl Grossman
The Most Lucrative Incentive for Nuclear Power in the History of the United States

William S. Lind
Inside the Washington Game

Robert Weissman
What to do About the Price of Oil

Dave Lindorff
Why Puerto Rico Won't Matter

David Macaray
A Union Fable

Chris Genovali
Fear and Loathing in the Northern Rockies

Laura Carlsen
Mexico's Battle Over Oil

Website of the Day
Support Antiwar.com

May 28, 2008

Wajahat Ali
The Libertarian Dark Horse: An Exclusive Interview with Ron Paul

Ralph Nader
What's Really Driving the High Price of Oil?

Brian McKenna
Why I Want to Teach Anthropology at the Army War College

Corporate Crime Reporter
Why Vincent Bugliosi Wants to Prosecute George W. Bush for Murder

Brian Cloughley
The Attack on Damadola

Eric Walberg
Opium for the Masses from Afghanistan

Michael Dickinson
Raytheon's Pain Ray: Coming to a Protest Near You

Ijaz Khan
Opening Windows in Pakistan

Website of the Day
Older Than America

May 27, 2008

Alexander Cockburn
In Her Mind She's Killed Before: the Plot to Assassinate Ralph Nader

Greg Kafoury
Is Obama Turning (Further) Right?

Jean Bricmont
Western Delusions

Tim Wise
Farrakhan is not the Problem

Ricardo Alarcón
Puerto Rico's Turn

Stephen Soldz
APA Supports Psychologist Engagement in Bush Regime Interrogations

Andy Worthington
The Guantánamo 16

Alan Singer
Vapid, Stupid and Insulting: Chuck Schumer Speaks to the Graduates

Richard Neville
Storm in an A-Cup

Susie Day
Gone with the W

May 26, 2008

Uri Avnery
The Syrian Option

Bill Quigley
War Immemorial Day

Col. Dan Smith
Retreating from Hell: a Different Memorial Day

Cindy Sheehan
Why Memorial Day is a Double-Whammy for Me

Marjorie Cohn
Hillary's Assassination Politics: Her Last Shot?

Fred Gardner
Does the VA Care?

Raymond J. Lawrence
Pain Pays: Getting Rich at NY Presbyterian Hospital

Harvey Wasserman
Mugging the Election System

Moncia Benderman
Truth Matters

David Rovics
In Praise of Utah Phillips

Website of the Day
Fox News Jokes About "Knocking Off" Osama and Obama

May 24 / 25, 2008

Alexander Cockburn
Death-Wish Hillary Primes Manchurian Candidate

Jeffrey St. Clair
Yellowstone: How Sununu Shrank the Ecosystem

Barbara Rose Johnston
Dam Legacies, Damned Futures

Nikolas Kozloff
U.S. Fourth Fleet in Venezuelan Waters

Adriana Kojeve
The Environment and the 2008 Elections

Robert Fantina
Justice Department's Revelations on Torture

Dave Lindorff
Bush's War on Children in Iraq

David Yearsley
The War on Kitsch

Nelson P. Valdés
The Buying of "Democracy" Agents in Cuba

Kathleen M. Barry
Celebrating Ethnic Cleansing

John Ross
Mexico's Narco Opera Reaches for High Point

Allison Kilkenny
Apathy Doesn't Live in Bronx

Fred Gardner
Orangeburg, 1968

Elizabeth Schulte
Can the Whole World be Fed?

Daniel Gross
Remembering the Wendy's Massacre: the Dangerous Side of Retail Work

Christopher Brauchli
The Search for a Token Right-winger

Richard Rhames
A Nation of Sheep

Daniel Cassidy
My Mother

Poets' Basement
Davies, Klipschutz and Willson

Website of the Weekend
Happy Birthday, Bob

May 23, 2008

Paul Craig Roberts
War Abroad, Poverty at Home

Alan Farago
The Radical Extremists of the Building Industry

Conn Hallinan
Ballots and Bullets: From Beirut to Bolivia

Mark Engler
The World After Bush

George Wuerthner
Cars and Cows: Living Large in America

Kamran Matin
The Kurds and American Neo-Imperialism

Sandy Boyer /
Shaun Harkin
The Long Incarceration of Pol Brennan

Robert Weitzel
A "Holey" Instrument of Peace in Iraq

Cindy Sheehan
An Uphill Battle

Liaquat Ali Khan
Pakistan's Futile Constitutional Amendment

Website of the Day
A Message from the Moral Compass of the McCain Campaign

May 22, 2008

Vijay Prashad
Racist Grammar

Joanne Mariner
A Military Commissions Cheat Sheet

Sharon Smith
60 Years of Apartheid

Jeff Birkenstein
Disaster Redux: Some Early Thoughts on the Earthquake in China

Brendan McQuade
From Obama to the PRTs in Iraq

Peter Morici
The Sorry State of the Banking Industry

Niranjan Ramakrishnan
Restoration Boulevard

Dave Zirin
What I Want to Ask Mary Tillman

Ron Jacobs
CPR for the Antiwar Movement

Stephen Lendman
Immoral Hazard

Website of the Day
Hagee: God Sent Hitler to Drive the Jews to Israel

May 21, 2008

Jeffrey St. Clair
The Gothic Politics of Hillary Clinton

Nikolas Kozloff
U.S. Military Bases in South America

Alan Farago
Miami, Cuba and the Presidential Campaign

Dave Lindorff
Big John and the Scary, Scary Iran Threat

David Model
Genocide in Iraq?

Eric Walberg
Afghanistan: Who is the Enemy?

Franklin Lamb
Lebanon Gets a President

Kenneth Couesbouc
Tax Against Tyranny

Website of the Day
Child Labor and War-Affected Children: a Photo Essay

May 20, 2008

Ralph Nader
A Trip Inside Google

Uri Avnery
With Friends Like These

Patrick Irelan
The Empire and the Fleet

Ray McGovern
Come Out, Admiral Fallon, Wherever You Are

David Macaray
The UAW Strike Against American Axle

Chris Genovali
Big Oil on the Water: Skating Around the Tanker Issue

Ibrahim Fawal
Birmingham, Israel and the Nakba

Christopher Ketcham
Let Us Now Praise Famous Suicides

Andy Worthington
Guantánamo Trial Delayed

Martha Rosenberg
Merck is a Repeat Offender

Website of the Day
Defend the Students Who Pied Tom Friedman

May 19, 2008

Saul Landau
Cuba Will Live

Paul Craig Roberts
The Metamorphosis of the Conservative Movement

Brian McKenna
Brotherly Love in Philly's Badlands

Patrick Cockburn
City of the Dead: Mosul on Lockdown

B. R. Gowani
The Central Problem Pakistan Needs to Tackle

Dr. Trudy Bond
Psychologists and Torture: If Not Now, When?

Cindy Sheehan
Whose War is It?

John Mohawk
The Warriors Who Turned to Peace

Remi Kanazi
When Free Speech Doesn't Come for Free

Robert Day
I Get a Horse

Website of the Day
Evolve or Die

Subscribe Online

Don't Blame the Saudis

Gas Price Gouging

By MIKE WHITNEY

“I've seen this bad movie before. It's the Enron movie, which hit the West Coast power-markets like a bomb because the federal government was asleep at the switch. Now it's happening again with oil prices."

--Rep. Jay Inslee, D-WA

There is no oil shortage, not yet at least. The reason oil has skyrocketed to nearly $140 per barrel is because of rampant speculation. The peak oil doom-sayers are simply confusing the issue. This is not about shortages or scarcity; it's about gaming the system to fatten the bottom line. The whole scam is being executed by the same carpetbagging scoundrels who engineered the subprime fiasco; the investment bankers. The Wall Street Goliaths are using the futures market to recapitalize their flagging balance sheets after sustaining huge losses in the mortgage-backed securities boondoggle. That's the whole thing in a nutshell. Now they're on to their next swindle; distorting the futures market with gargantuan leveraged bets on food and oil.

MarketWatch summed it up like this on Monday:

“NEW YORK (MarketWatch) -- Speculators now account for about 70 per cent of all benchmark crude-oil trading on the New York Mercantile Exchange, up from 37 per cent in 2000, according to congressional findings cited in a Wall Street Journal report Monday. The report comes ahead of a House oversight subcommittee hearing slated for later Monday on Capitol Hill to study the role of financial investors in the crude futures market. There has been much discussion recently about how big a role so-called speculators have been playing in the sharp rise in energy prices, though no consensus has emerged on this point.

“Congress, however, has grown increasingly concerned over speculative investors' role in the energy market in comparison with those buying futures contracts to hedge against risk from price changes. Lawmakers are expected to consider legislation to set strict limits -- or in some cases, an outright ban -- on speculative trading in energy futures in some markets, the Journal reported.

In 1991, the Commodity Futures Trading Commission authorized the first exemption from position limits for swap dealers with no physical commodity exposure, the report said. This began what Dingell said was "a process that has enabled investment banks to accumulate enormous positions in commodity markets," according to the report. (MarketWatch)

So its not really Big Oil or "greedy Arabs" after all? Nope, it's the cutthroat banksters again.

Over the weekend, Saudi Arabia's King Abdullah convened an emergency Oil Summit in Jiddah, Saudi Arabia to deal with the disastrous effects that oil prices were having on the global economy. Rising prices are responsible for everything from food riots in Haiti to truckers strikes in Spain, Portugal and France. US Energy Secretary Samuel Bodman delivered a prepared statement supporting the Bush administration's position on the issue:

"Market fundamentals show us that production has not kept pace with growing demand for oil, resulting in increasing -- and increasingly volatile -- prices. Even despite higher global production for oil so far this year, inventories have been drawn down and current world production (spare) capacity is below historic levels -- at fewer than two million barrels per day."

Baloney.

Demand is not out-pacing supply. That's a myth started by the people who are profiting by betting up oil futures; investment bankers. They're led by their chief defender and former G-Sax scalawag, Henry Paulson.

Consider the remarks of Philip Davis in a recent post at Seeking Alpha:

"Now we have the Saudi oil summit this weekend and Saudi Arabia took 1.5M barrels a day off-line since July of ‘05 in a series of cuts and is currently producing just over 8Mbd out of their estimated 10.5Mbd maximum capacity. It is forecast by the EIA that next year OPEC alone will have over 3Mbd of spare capacity so this would be a terrible time for global demand to take a nose dive or there are going to be a lot of idle wells… Should global demand drop another 5 per cent in the next 12 months, we could be looking at 8Mbd less demand than there was just a year ago.

“As the London Telegraph points out, not only does OPEC have a current production surplus of 2M barrels a day but that surplus will rise to 3.5M barrels a day by next year. Also, non-OPEC production is rising fast with a 1.5Mb gain in non-OPEC production coming down the pike next year. ...Iraq, by the way, is no longer included as OPEC or non-OPEC production, a very clever way to hide 2.4 million barrels of production by the energy apologists." (Philip Davis, "The Oil Shortage, and Other fairy Tales" Seeking Alpha).

There's no shortage, no scarcity. In fact, oil is being deliberately kept off the market to keep prices high. Consider this: if supply isn't keeping up with demand then why aren't there any lines at the gas stations like there were during the '70s?

Because it's all a fabrication. Prices are up because of speculation; that's all. Here's what Saudi Arabia's King Abdullah said on Sunday: "Among other factors behind this unjust increase in oil prices is the abhorrent acts of speculators seeking to undermine the market." That's why he called the meeting to begin with. The King insists that "speculators" have played a key role." (AFP)

How about Kuwait?

The Kuwaiti Oil Minister Mohammed al-Olaim insisted that "there is enough oil to supply the market....We believe that the market is in equilibrium. The price is disconnected from fundamentals. It is not a problem of supply. Why would you have a supply problem when demand is going down". (AP)

Of course, demand goes down in a recession.

What about Libya?

"We believe speculation has its impact," the OPEC chief said. Libya may reduce its oil production because there is more than enough oil on the market, according to  Oil Minister Shokri Ghanem. "We may have to cut production.... We don't see any need for more oil. There is plenty of oil in the market,'' Ghanem said, commenting on Saudi Arabia's decision. (Bloomberg News)

How about Iraq? Can we at least count on our brothers in Iraq to maintain the administration's falsehoods about supply problems?

According to Reuters: Iraq's Oil Minister Hussain al-Shahristani said, "Any increase in world oil output would not have a significant impact on record-high crude prices that are being driven by speculation... Regulations needed to be introduced to stabilize oil markets. I do not think increasing any amount in the international market will have a significant impact on the prices. It is up to the stock exchange and the regulations in the industrialized nations. It is not something OPEC can contribute to. We did not see any impact on the prices from the Saudi's previous increase." (Reuters)

Venezuela?

Venezuela Oil Minister Rafael Ramirez refused to join the weekend conference because "We believe it is not necessary to increase output...Oil production levels aren't behind the increase in prices," Ramirez said, adding that soaring oil prices were caused by 'speculative interest, a falling dollar and global inflation'. (Reuters)

So, are all the oil ministers lying or is the Bush administration intentionally misleading the public about supply problems?

It’s always easy to point the finger at Big Oil or "greedy" Arabs for price gouging, but that's not what's really going on. The Bush administration is colluding with their Wall Street buddies to fleece the public by inflating another bubble; this time in commodities.

Congress could end this charade in a minute by passing legislation that would close the Swaps Loophole and require steeper margin limits on oil futures. But don't hold your breath. Wall Street is the biggest contributor to political campaigns which explains how we got into this pickle to begin with. It also explains why Congress's public approval rating has shriveled to 12 per cent.

Do Bush and Bernanke know what the banks are up to? Do they know that billions that are being loaned to the banks via the Fed's "auction facilities" are probably being diverted into the commodities market and driving up the prices of raw materials and oil, while pushing the world towards global recession?

You bet they do and they're probably doing everything in their power to keep the banking system from buckling beneath the weight of its own massive debts.

Here's an excerpt from Spiegel Online’s "Are Pension Funds Fueling High Oil? which explains the whole scam:

"Commodities exchanges limit the number of positions an investor can take in the market, but Michael Masters, of Masters Capital Management, says the Commodity Futures Trading Commission has allowed unlimited speculation in these markets through a loophole. This so-called swaps loophole exempts investment banks like Goldman Sachs and Merrill Lynch from reporting requirements and limits on trading positions that are required of other investors. the loophole allows pension funds to enter into a swap agreement with an investment bank which can then trade unlimited numbers of the contracts in futures markets."

"Some experts fault the CFTC, charged with regulating commodities markets, for allowing such loopholes. "Congress has provided the CFTC the power to control this unlimited [speculation]; the law is very specific about establishing position limits," says Steve Briese, author of The Commitments of Traders Bible and CommitmentsOfTraders.org, a site that focuses on US futures markets. "The problem is they have abdicated this role." The dramatic surge in energy prices has helped to spark inflation across the economy and, as others at the hearing testified, has cut into profits of most in the supply chain. Briese points to Treasury reports that the the top five users of swap agreements are investment banks, four of which dominate swap dealing in commodities and commodities futures: Bank of America, Citigroup, JP Morgan Chase, HSBC North America Holdings, and Wachovia. (Spiegel Online)

Citing the harmful impacts record high crude oil prices are having on consumers, US Rep. Bart Stupak (D-Mich.) introduced a bill to close regulatory loopholes:

"The numbers back this up: Between Sept. 30, 2003, and May 6, 2008, contracts held by traders jumped from 714,000 to more than 3 million, a 425 per cent increase. Since 2003, commodity index speculation has increased 1,900 per cent from an estimated $13 billion to $260 billion invested. Stupak said CFTC data show that in 2000, physical hedges that airlines and other businesses use to ensure a stable price for fuel in coming months and actually imply delivery, accounted for an estimated 63 per cent of the total futures market, while speculators represented about 37 per cent. "By April 2008, physical hedgers only controlled 29 per cent and speculators had taken over a whopping 71 per cent of the oil futures market."

He said 85 per cent of the futures purchases tied to commodity index speculation comes through swap dealers—investment banks that serve as intermediaries for their pension fund and sovereign wealth fund customers. One report found that $55 billion of total worldwide commodity trading over 55 days came in as swaps. "The CFTC has allowed 117 exceptions to swaps. When that many exceptions are allowed, they are not really subject to oversight. We have a CFTC that's supposed to be doing its job. I'm not certain that it is," he said.

Another Smoking Gun

On May 20, 2008 Michael Masters, testified before the Senate Committee on Homeland Security and Governmental Affairs, on the role that speculation has played in recent commodity price movements. He said:

"In the popular press the explanation given most often for rising oil prices is the increased demand for oil from China. According to the DOE, annual Chinese demand for petroleum has increased over the last five years from 1.88 billion barrels to 2.8 billion barrels, an increase of 920 million barrels. Over the same five-year period, index speculators demand for petroleum futures has increased by 848 million barrels. The increase in demand from Index Speculators is almost equal to the increase in demand from China!"

Masters is right; there is massive speculation which is distorting the market, but who is responsible? Clearly, the pension fund managers aren't to blame. After all, the largest US pension funds, which is the California Public Employees Retirement System (CalPERS), has only invested about $1.1 billion in commodities swaps contracts. That's a far-cry from $260 billion. The investment giants and hedge funds are probably leveraging the money they receive from the pension funds many times over to increase the size of their bets. Keep in mind, oil futures can be purchased for a mere $.06 on the dollar; that's a lot of potential leverage.

Masters again: "Commodities prices have increased more in the aggregate over the last five years than at any other time in U.S. history. We have seen commodity price spikes occur in the past as a result of supply crises, such as during the 1973 Arab Oil Embargo. But today, unlike previous episodes, supply is ample: there are no lines at the gas pump and there is plenty of food on the shelves. Today, Index Speculators are pouring billions of dollars into the commodities futures markets, speculating that commodity prices will increase."

Index Speculators have now stockpiled, via the futures market, the equivalent of 1.1 billion barrels of petroleum, effectively adding eight times as much oil to their own stockpile as the united states has added to the Strategic Petroleum Reserve over the last five years:

"We calculate that Index Speculators flooded the markets with $55
billion in just the first 52 trading days of this year. That’s an increase in the dollar value of outstanding futures contracts of more than $1 billion per trading day.

Doesn’t it seem likely that an increase in demand of this magnitude in the commodities futures markets could go a long way in explaining the extraordinary commodities price increases in the beginning of 2008?"

Yes, it does. And it also explains where billions of dollars from the Fed's "auction facilities" are going. After all, they're certainly not going into mortgage-backed securities anymore, and MBS represented nearly 70 per cent of bank revenue. So, where would a desperate banker turn if his main revenue-stream had dried up and the corporate bond market was frozen solid?

How about oil futures and commodities; the only game in town? As the MarketWatch article suggests, oil prices are inflated by about 70 per cent.

Mike Whitney lives in Washington state. He can be reached at: fergiewhitney@msn.com

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