Birth Pangs Of The Coming Great Depression
By Michael Snyder of The Economic CollapseFriday, January 30, 2015 3:28 AM EDTThe signs of the times are everywhere – all you have to do is open up your eyes and look at them. When a pregnant woman first goes into labor, the birth pangs are usually fairly moderate and are not that close together. But as the time for delivery approaches, they become much more frequent and much more intense. Economically, what we are experiencing right now are birth pangs of the coming Great Depression. As we get closer to the crisis that is looming on the horizon, they will become even more powerful. This week, we learned that the Baltic Dry Index has fallen to the lowest level that we have seen in 29 years.The Baltic Dry Index also crashed during the financial collapse of 2008, but right now it is already lower than it was at any point during the last financial crisis. In addition, "Dr. Copper" and other industrial commodities continue to plunge. This almost always happens before we enter an economic downturn. Meanwhile, as I mentioned the other day, orders for durable goods are declining. This is also a traditional indicator that a recession is approaching. The warning signs are there – we just have to be open to what they are telling us.
And of course there are so many more parallels between past economic downturns and what is happening right now.
For example, volatility has returned to the markets in a big way. On Tuesday the Dow was down about 300 points, on Wednesday it was down another couple hundred points, and then on Thursday it was up a couple hundred points.
This is precisely how markets behave just before they crash. When markets are calm, they tend to go up. When markets get really choppy and start behaving erratically, that tells us that a big move down is usually coming.
At the same time, almost every major global currency is imploding. For much more on this, see the amazing charts in this article.
In particular, I am greatly concerned about the collapse of the euro. The Swiss would not have decoupled their currency from the euro if it was healthy. And political events in Greece are certainly not going to help things either. Economic conditions across Europe just continue to get worse, and the future of the eurozone itself is very much in doubt at this point. And if the eurozone does break up, a European economic depression is almost virtually assured – at least in the short term.
And I haven't even mentioned the oil crash yet.
There is only one other time in all of history when the price of oil collapsed by more than 60 dollars, and that was just prior to the horrific financial crisis of 2008.
Since the last financial crisis, the oil industry has been a huge source for job growth in this country. The following is an excerpt from a recent CNN article…
The oil sector has added over a half million jobs — many of them high paying — since the recession ended in June 2009. That's 13% of all US job growth over that period.
Now energy companies and related sectors are laying off thousands. Expect that trend to continue, bears say.
But losing good jobs is just the tip of the iceberg of this oil crisis.
At this point, the price of oil has already dropped to a catastrophically low level. The longer it stays at this level, the more damage that it is going to do. If the price of oil stays at this level for all of 2015, we are going to have a complete and total financial nightmare on our hands…
For the first time in 18 years, oil exporters are pulling liquidity out of world markets rather than putting money in. The world is now fast approaching a world reserve currency shift. If we see 8 to 12 months at these oil prices; U.S. shale industry will be wiped out. The effect on junk bonds will cascade to the rest of the stock market and U.S. economy.
…and this time there will be nothing left to catch the falling knife before it hits the American economy right in the heart. Not the FED nor the U.S. government can stop what's coming. Liquidity will freeze up, our credit will be downgraded, the stock market will start to collapse, and then we can expect the FED to come in and hyper-inflate the dollar. This will cause the world to finish abandoning the world reserve currency in the last rungs of trade. This will be the end of the petrodollar.
Something that I have not discussed so far this year is the looming crisis in emerging market debt.
As economic problems spread around the world, a number of "emerging markets" are in danger of having their debt downgraded. And many investment funds have rules that prohibit them from holding any debt that is not "investment grade". Therefore, we could potentially see some of these giant funds dumping massive amounts of emerging market debt if downgrades happen.
This is a really big deal. As a Business Insider article recently detailed, we could be talking about hundreds of billions of dollars…
Russia this week became the first of the major economies to lose its investment grade status from Standard & Poor's, falling out off the top ratings category for credits deemed to have a low risk of default for the first time in a decade.
If Moody's and Fitch follow, conservative investors barred from owning junk securities must sell their holdings. JPMorgan estimates this means they may ditch $6 billion in Russian government rouble and dollar debt.
Russia may have company. Almost $260 billion worth of sovereign and corporate bonds – nearly a tenth of outstanding emerging market (EM) debt – is in danger of being relegated to junk, according to David Spegel, head of emerging debt at BNP Paribas, who calls such credits "falling angels".
And no article of this nature would be complete without mentioning derivatives.
I could not possibly overemphasize the danger that the 700 trillion dollar derivatives bubble poses to the global financial system.
As we enter the coming Great Depression, derivatives are going to play a starring role. Wall Street has been pumped full of funny money by global central banks, and our financial markets have been transformed into the greatest casino in the history of the world. When this house of cards comes crashing down, and it will, it is going to be a financial disaster unlike anything that the planet has ever seen.
And yes, global central banks are very much responsible for setting the stage for what we are about to experience.
I really like the way that David Stockman put it the other day…
The global financial system is literally booby-trapped with accidents waiting to happen owing to six consecutive years of massive money printing by nearly every central bank in the world.
Over that span, the collective balance sheet of the major central banks has soared by nearly $11 trillion, meaning that honest price discovery has been virtually destroyed. This massive "bid" for existing financial assets based on credit confected from thin air drove long-term bond yields to rock bottom levels not seen in 600 years since the Black Plague; and pinned money market costs at zero—-for 73 months running.
What is the consequence of this drastic financial repression along the entire yield curve? The answer is bond prices which keep rising regardless of credit risk, inflation or taxes; and rampant carry trade speculation that can't get out of its own way because central banks have made the financial gamblers' cost of goods—the "funding" cost of their trades—-essentially zero.
Of course I am not the only one warning that a new Great Depression is coming. For instance, just consider what British hedge fund manager Crispin Odey is saying…
British hedge fund manager Crispin Odey thinks we've entered an economic downturn that is "likely to be remembered in a hundred years," and central banks won't be able to stop it.
In his Odey Asset Management investor letter dated Dec. 31, Odey writes that the shorting opportunity "looks as great as it was in 07/09."
"My point is that we used all our monetary firepower to avoid the first downturn in 2007-09," he writes, "so we are really at a dangerous point to try to counter the effects of a slowing China, falling commodities and EM incomes, and the ultimate First World Effects. This is the heart of the message. If economic activity far from picks up, but falters, then there will be a painful round of debt default."
Even though most average citizens are completely oblivious to what is happening, many among the elite are heeding the warning signs and are feverishly getting prepared. As Robert Johnson told a stunned audience at the World Economic Forum the other day, they are "buying airstrips and farms in places like New Zealand". They can see the horrifying storm forming on the horizon and they are preparing to get out while the getting is good.
It can be very frustrating to write about economics, because things in the financial world can take an extended period of time to play out. Sadly, most people these days have extremely short attention spans. We live in a world of iPhones, iPads, YouTube videos, Facebook updates and 48 hour news cycles. People no longer are accustomed to thinking in long-term time frames, and if something does not happen right away we tend to get bored with it.
But the economic world is not like a game of "Angry Birds". Rather, it is very much like a game of chess.
And unfortunately for us, checkmate is right around the corner.
Wednesday, April 8, 2015
Saturday, April 4, 2015
Re: Yemen and Socotra Island and Militarization of Strategic Waterways
Yemen and Socotra ; and Militarization of Strategic Waterways
Securing US Control over Socotra Island and the Gulf of Aden
35644 7 3533This article was first published by GR more than five years ago sheds light on America's unspoken military agenda: the control over strategic waterways (GR Ed. M. Ch)
"Whoever attains maritime supremacy in the Indian Ocean would be a prominent player on the international scene." (US Navy Geostrategist Rear Admiral Alfred Thayus Mahan (1840-1914))
The Yemeni archipelago of Socotra in the Indian Ocean is located some 80 kilometres off the Horn of Africa and 380 kilometres South of the Yemeni coastline. The islands of Socotra are a wildlife reserverecognized by (UNESCO), as a World Natural Heritage Site.
Socotra is at the crossroads of the strategic naval waterways of the Red Sea and the Gulf of Aden (See map below). It is of crucial importance to the US military.
MAP 1
Among Washington's strategic objectives is the militarization of major sea ways. This strategic waterway links the Mediterranean to South Asia and the Far East, through the Suez Canal, the Red Sea and the Gulf of Aden.
It is a major transit route for oil tankers. A large share of China's industrial exports to Western Europe transits through this strategic waterway. Maritime trade from East and Southern Africa to Western Europe also transits within proximity of Socotra (Suqutra), through the Gulf of Aden and the Red Sea. (see map below). A military base in Socotra could be used to oversee the movement of vessels including war ships in an out of the Gulf of Aden.
"The [Indian] Ocean is a major sea lane connecting the Middle East, East Asia and Africa with Europe and the Americas. It has four crucial access waterways facilitating international maritime trade, that is the Suez Canal in Egypt, Bab-el-Mandeb (bordering Djibouti and Yemen), Straits of Hormuz (bordering Iran and Oman), and Straits of Malacca (bordering Indonesia and Malaysia). These 'chokepoints' are critical to world oil trade as huge amounts of oil pass through them." (Amjed Jaaved, A new hot-spot of rivalry, Pakistan Observer, July 1, 2009)
MAP 2
Sea Power
From a military standpoint, the Socotra archipelago is at a strategic maritime crossroads. Morever, the archipelago extends over a relatively large maritime area at the Eastern exit of the Gulf of Aden, from the island of Abd al Kuri, to the main island of Socotra. (See map 1 above and 2b below) This maritime area of international transit lies in Yemeni territorial waters. The objective of the US is to police the entire Gulf of Aden seaway from the Yemeni to Somalian coastline. (See map 1).
MAP 2b
Socotra is some 3000 km from the US naval base of Diego Garcia, which is among America's largest overseas military facilities.
The Socotra Military Base
On January 2nd, 2010, President Saleh and General David Petraeus, Commander of the US Central Command met for high level discussions behind closed doors.
The Saleh-Petraeus meeting was casually presented by the media as a timely response to the foiled Detroit Christmas bomb attack on Northwest flight 253. It had apparently been scheduled on an ad hoc basis as a means to coordinating counter-terrorism initiatives directed against "Al Qaeda in Yemen", including "the use [of] American drones and missiles on Yemen lands."
Several reports, however, confirmed that the Saleh-Petraeus meetings were intent upon redefining US military involvement in Yemen including the establishment of a full-fledged military base on the island of Socotra. Yemen's president Ali Abdullah Saleh was reported to have "surrendered Socotra for Americans who would set up a military base, pointing out that U.S. officials and the Yemeni government agreed to set up a military base in Socotra to counter pirates and al-Qaeda." (Fars News.January 19, 2010)
On January 1st, one day before the Saleh-Petraeus meetings in Sanaa, General Petraeus confirmed in a Baghdad press conference that "security assistance" to Yemen would more than double from 70 million to more than 150 million dollars, which represents a 14 fold increase since 2006. (Scramble for the Island of Bliss: Socotra!, War in Iraq, January 12, 2010. See also CNN January 9, 2010, The Guardian, December 28, 2009).
This doubling of military aid to Yemen was presented to World public opinion as a response to the Detroit bomb incident, which allegedly had been ordered by Al Qaeda operatives in Yemen.
The establishment of an air force base on the island of Socotra was described by the US media as part of the "Global war on Terrorism":
"Among the new programs, Saleh and Petraeus agreed to allow the use of American aircraft, perhaps drones, as well as "seaborne missiles"–as long as the operations have prior approval from the Yemenis, according to a senior Yemeni official who requested anonymity when speaking about sensitive subjects. U.S. officials say the island of Socotra, 200 miles off the Yemeni coast, will be beefed up from a small airstrip [under the jurisdiction of the Yemeni military] to a full base in order to support the larger aid program as well as battle Somali pirates. Petraeus is also trying to provide the Yemeni forces with basic equipment such as up-armored Humvees and possibly more helicopters." (Newsweek, Newsweek, January 18, 2010, emphasis added)
Existing runway and airportUS Naval Facility?
The proposed US Socotra military facility, however, is not limited to an air force base. A US naval base has also been contemplated.
The development of Socotra's naval infrastructure was already in the pipeline. Barely a few days prior (December 29, 2009) to the Petraeus-Saleh discussions (January 2, 2010), the Yemeni cabinet approved a US$14 million loan by Kuwait Fund for Arab Economic Development (KFAED) in support of the development of Socotra's seaport project.
MAP 3
The Great Game
The Socotra archipelago is part of the Great Game opposing Russia and America.
During the Cold War, the Soviet Union had a military presence in Socotra, which at the time was part of South Yemen.
Barely a year ago, the Russians entered into renewed discussions with the Yemeni government regarding the establishment of a Naval base on Socotra island. A year later, in January 2010, in the week following the Petraeus-Saleh meeting, a Russian Navy communiqué "confirmed that Russia did not give up its plans to have bases for its ships… on Socotra island." (DEFENSE and SECURITY (Russia), January 25, 2010)
The Petraeus-Saleh January 2, 2010 discussions were crucial in weakening Russian diplomatic overtures to the Yemeni government.
The US military has had its eye on the island of Socotra since the end of the Cold War.
In 1999, Socotra was chosen "as a site upon which the United States planned to build a signal intelligence system…." Yemeni opposition news media reported that "Yemen's administration had agreed to allow the U.S. military access to both a port and an airport on Socotra." According to the opposition daily Al-Haq, "a new civilian airport built on Socotra to promote tourism had conveniently been constructed in accordance with U.S. military specifications." (Pittsburgh Post-Gazette (Pennsylvania), October 18, 2000)
The Militarization of the Indian Ocean
The establishment of a US military base in Socotra is part of the broader process of militarization of the Indian Ocean. The latter consists in integrating and linking Socotra into an existing structure as well as reinforcing the key role played by the Diego Garcia military base in the Chagos archipelago.
The US Navy's geostrategist Rear Admiral Alfred T. Mahan had intimated, prior to First World War, that "whoever attains maritime supremacy in the Indian Ocean [will] be a prominent player on the international scene.".(Indian Ocean and our Security).
What was at stake in Rear Admiral Mahan's writings was the strategic control by the US of major Ocean sea ways and of the Indian Ocean in particular: "This ocean is the key to the seven seas in the twenty-first century; the destiny of the world will be decided in these waters."
MAP 4
Michel Chossudovsky is Professor of Economics (Emeritus) at the University of Ottawa and Director of the Centre for Research on Globalization (CRG), Montreal, which hosts the award winning website:www.globalresearch.ca . He is the author of the international best-seller "The Globalisation of Poverty and The New World Order". He is contributor to the Encyclopaedia Britannica, member of the Kuala Lumpur War Crimes Commission and recipient of the Human Rights Prize of the Society for the Protection of Civil Rights and Human Dignity (GBM), Berlin, Germany. His writings have been published in more than twenty languages.
Friday, April 3, 2015
Yemen; Saudi Arabia’s Afghanistan?
Yemen; Saudi Arabia's Afghanistan?
USA, along with some NATO countries including Turkey is now exhorting its Sunni allies in the Arab world, especially in the Gulf, led by Riyadh for blatant illegal intervention in Yemen, a very poor country, which was relatively peaceful compared to the rest of the region under devastation since 2003 when international law was thrown out of the UN window by Bush and Blair. Riyadh has even called in indebted Pakistan as well, itself fighting a life death struggle against its own created terrorists.
At a time when Iran is engaged in a long drawn out negotiations with P +1 powers ,Saudi Arabia led bombing and other actions, including reported massing of 150,000 soldiers(really) along its border with Yemen ,has brought destruction and death of innocent people of this country. Some reports suggest that Saudi Arabia wants to detach South Yemen and bring it under its control and of its allies ie Washington etc because it commands the Red sea and the Arabian Sea .Along its coast sail both ways ships laden with oil and other commodities. Even Israeli submarines go into the Gulf to keep a watch on Iran.
This policy of Saudi Arabia getting involved in to a very troubled area by recently appointed 30years old inexperienced defence minister ibn Saman is unwise if not foolhardy. Apart from Shia Houthis Yemen also hosts a very well organised Al Qaeda branch. But Saudis are not bombing Al-Qaida.
Sharmine Narwani , a commentator and analyst of Middle East geopolitics says
"The battle, at its very essence, in its lowest common denominator, is a war between a colonial past and a post-colonial future."
For the sake of clarity, let's call these two axes the Neo-Colonial Axis and the Post-Colonial Axis. The former seeks to maintain the status quo of the past century; the latter strives to shrug off old orders and carve out new, independent directions.
If you look at the regional chessboard, the Middle East is plump with governments and monarchies backed to the hilt by the United States, Britain and France. These are the West's "proxies" and they have not advanced their countries in the least – neither in self-sufficiencies nor in genuine democratic or developmental milestones. Indebted to 'Empire's' patronage, these states form the regional arm of the Neo-Colonial Axis.
On the other side of the Mideast's geopolitical fault line, Iran has set the standard for the Post-Colonial Axis – often referred to as the 'Resistance Axis.' Based on the inherent anti-imperialist worldview of the 1979 Islamic revolution, and also as a result of US/UK-driven isolating sanctions and global politics, Tehran has bucked the system by creating an indigenous system of governance, advancing its developmental ambitions and crafting alliances that challenge the status quo.
Iran's staunchest allies have typically included Syria, Hezbollah and a handful of Palestinian resistance groups. But today, in the aftermath of the Arab Spring counter-revolutions – and the sheer havoc these have created - other independent players have discovered commonalities with the Resistance Axis. In the region, these include Iraq, Algeria and Oman. While outside the Mideast, we have seen Russia, China and other non-aligned nations step in to challenge the Neo-Colonial order."
Says Graham E. Fuller
'Yemen, like Afghanistan, has a long reputation as a quagmire for foreign invaders. Saudi Arabia could break its teeth there if the U.S. does not constrain it.' He added ,'The Saudis' small Gulf neighbors may not find it so comfortable to support a new, more geopolitically ambitious Riyadh -- with its radical Islamic ideology and its virulently sectarian regional vision. Nor should the U.S. A massive, unnecessary -- and likely failing Saudi effort --to take over Yemen in this counter-revolutionary spirit may augur dangerously for the stability of the Peninsula in the future.
Two interesting articles below;
K.Gajendra Singh, 3 April, 2015, Delhi
http://tarafits.blogspot.in/2014/02/amb-rtd-k-gajendra-singh-cv-post.html
How to Decipher Yemen, Where the Enemy of Your Enemy Is Also Your Enemy
Former vice chairman, CIA's National Intelligence Council
Posted: 31/03/2015
http://www.huffingtonpost.com/graham-e-fuller/decipher-yemen_b_6965564.html?ir=India
Yemen, like Afghanistan, has a long reputation as a quagmire for foreign invaders. Saudi Arabia could break its teeth there if the U.S. does not constrain it. Astonishingly, Yemeni events have now conspired to bring about the supposed intervention of some 10 regional powers in one of the most hyped events in the Arabian Peninsula of recent times.
Most of this proxy war makes little sense: the threats emanating from Yemen are distorted and exaggerated, the stakes are actually relatively low (except for Yemenis), any imposed settlement is highly elusive, and the costs to those engaged may be high. For the U.S., it can be once again something of a lose-lose situation, where the enemy of my enemy is often also my enemy.
There are fourth myths about Yemen that need to be sorted out:
The first myth is that this war represents yet a new front on a massive regional Sunni-Shiite struggle. The reality is that a great deal of this struggle is heavily among Yemeni Shiites themselves. Yes, the Houthis, who are now well on the way to seizing leadership of the entire country, are indeed Shiite. They are Zaydi Shiites to be specific (also known as Fivers, believing in five imams) -- who differ significantly from Iranian Shiites (mostly Twelvers). Indeed, among the various schools of Shiism, Zaydism is theologically closest to Sunni Islam. Sunni and Shia have co-existed quite well in Yemen over long centuries.
Zaydi imams ruled most of Yemen for hundreds of years as an Imamate, until some 60 years ago when an Arab nationalist revolution displaced them.
But the Zaydi Shia remain a major force in the country (some 40 percent) and are dominant in the north. Furthermore, the two most important tribal confederations in the country are also both Zaydi. So was the former president of Yemen for 32 years, Ali Abdullah Saleh (overthrown in the Arab Spring and who now may be secretlysupporting the Houthis). The Houthis are simply one regional Zaydi clan who happen to be rebelling for an end to what they saw as discrimination and the corruption of Saleh and his successor -- both Saudi-supported Shiites. Typically the Houthi movement takes the form of a revivalist movement seeking cleaner government and a "purer Zaydism."
The second myth is that the Houthis represent the cutting edge of Iranian imperialism in Arabia -- as trumpeted by the Saudis. The Zaydi Shia, including the Houthis, over history have never had a lot to do with Iran. But as internal struggles within Yemen have gone on, some of the Houthis have more recently been happy to take Iranian coin and perhaps some weapons -- just as so many others, both Sunni and Shia, are on the Saudi payroll. The Houthis furthermore hate al-Qaeda and hate the Islamic State. And more recently they have denounced the U.S. as well for its past support to the government in Sanaa that was suppressing the Houthis.
The third myth is that Saudi Arabia is fighting to "preserve stability in the Arabian Peninsula." What the Saudis are doing is fighting to maintain overlordship in the Arabian peninsula (an Arabian Monroe Doctrine). A century ago, the Saudis seized traditionally Yemeni areas in the southwest corner of Saudi Arabia and forcibly imposed radical Wahhabi views there. Riyadh has always loathed Yemeni feistiness, independence, its revolutionary politics, and even its experiments with democracy. The Saudis have traditionally sought to buy off as many tribal and political forces as they can in Yemen -- Sunni or Shiite -- to try to maintain their shaky and shifting form of dominance.
But now it's about more than just Yemen. In the wake of the Arab Spring, Saudi Arabia has sought to forge a broad counter-revolutionary force to block any further regime change in the Arab world; it brands its new campaign as some kind of pan-Arab Sunni movement designed to face an ostensible "Persian/Shiite threat."
With a lot of money and the support of insecure Gulf rulers, the Saudis now seem to have orchestrated some grand Sunni front to invade Yemen to "meet the looming Iranian threat." From Riyadh's perspective, Tehran has supposedly pocketed Iraq, is successfully keeping Assad in power in Syria, threatens Bahrain, stirs oppressed and restive Shia within the Saudi Kingdom, and now bids to control Yemen, thereby "encircling the Peninsula." Ironically, the promising U.S.-Iranian nuclear talks raise further fears in Riyadh that Washington will no longer be a predictable member of the demonize-Iran camp.
Much of this paranoia reflects fevered authoritarian Saudi thinking. Never mind that Persians have never in centuries invaded the Arabian Peninsula. Shiite majorities, as in Iraq and Bahrain, have indeed demanded democratic processes that hugely empower them politically. But since the Saudis in recent years have all but declared war against Iran and created a massive anti-Shiite front -- mostly to preserve Arabian and Egyptian autocrats --Tehran has reciprocated; it is happy to try to keep the Saudis off balance in Yemen at quite limited cost. But it is absurd to believe that Tehran is in a position ever to call the political shots in obstreperous Yemen. And the fear that the Houthis in power want, or are even capable of shutting down the Bab al-Mandab entrance to the Red Sea is a fantasy.
The fourth myth is that the U.S. has support in Yemen. Whatever support it has is extremely limited; its interests and policies in this dirt-poor country over the last decades have focused almost exclusively on counter-terrorism. In the process, the U.S. backed the three-decade dictatorship of Ali Abdullah Saleh and has been conducting dozens of drone strikes in the country that have caused many civilian deaths and stirred much anger. Under the present turmoil, the U.S. has felt compelled to close its embassy and has largely decamped to Riyadh. Washington now helps advise the 10-nation anti-Yemen campaign from Riyadh in what looks increasingly like some grand Arabian armada run amok.
The choices for the U.S. are poor. But Houthi dominance in Yemen need not be a disaster in itself. They are blood enemies of the militantly anti-Shiite forces of al-Qaeda and ISIS. Still, the Houthis will be deeply suspicious of U.S. intentions, especially now that the U.S. is working with Yemen's arch-enemy, Saudi Arabia. For that matter, the Houthis are not fanatics and will not be able by themselves to control Yemen unless they work with the broad array of political and religious forces and ideologies that make up the Yemeni mosaic.
But we now face a major new factor. The new, ailing Saudi King Salman -- or more precisely his activist, powerful and ambitious son -- now are bidding for a historical transformation of the Kingdom's long-standing cautious and defensive foreign policies.
We should remember that the history of Saudi Arabia shows its Wahhabi forces sweeping twice across the Peninsula to the Persian Gulf in some kind of Arabian Manifest Destiny.
The Saudis' small Gulf neighbors may not find it so comfortable to support a new, more geopolitically ambitious Riyadh -- with its radical Islamic ideology and its virulently sectarian regional vision. Nor should the U.S. A massive, unnecessary -- and likely failing Saudi effort --to take over Yemen in this counter-revolutionary spirit may augur dangerously for the stability of the Peninsula in the future.
Graham E. Fuller is a former senior CIA official; his latest book is "Breaking Faith: A novel of espionage and an American's crisis of conscience in Pakistan."grahamefuller.com
Will Yemen kick-off the 'War of the two Blocs?'
Sharmine Narwani is a commentator and analyst of Middle East geopolitics. She tweets @snarwani
http://rt.com/op-edge/245585-us-yemen-policies-middle-east/
There is media confusion about what is going on in Yemen and the broader Middle East. Pundits are pointing out that the US is looking schizophrenic with policies that back opposite sides of the fight against al-Qaeda-style extremism in Iraq and in Yemen.
But it isn't that hard to understand the divergent policies once you comprehend the underlying drivers of the fight brewing in the region.
No, it isn't a battle between Shia and Sunni, Iranian and Arab or the much-ballyhooed Iran-Saudi stand-off. Yes, these narratives have played a part in defining 'sides,' but often only in the most simplistic fashion, to rally constituencies behind a policy objective. And they do often reflect some truth.
But the 'sides' demarcated for our consumption do not explain, for instance, why Oman or Algeria refuse to participate, why Turkey is where it is, why Russia, China and the BRICS are participants, why the US is so conflicted in its direction – and why, in a number of regional conflicts, Sunni, Shia, Islamist, secularist, liberal, conservative, Christian, Muslim, Arab and Iranian sometimes find themselves on the same side.
This is not just a regional fight – it is a global one with ramifications that go well beyond the Middle East. The region is quite simply the theatre where it is coming to a head. And Yemen, Syria and Iraq are merely the tinderboxes that may or may not set off the conflagration.
"The battle, at its very essence, in its lowest common denominator, is a war between a colonial past and a post-colonial future."
For the sake of clarity, let's call these two axes the Neo-Colonial Axis and the Post-Colonial Axis. The former seeks to maintain the status quo of the past century; the latter strives to shrug off old orders and carve out new, independent directions.
If you look at the regional chessboard, the Middle East is plump with governments and monarchies backed to the hilt by the United States, Britain and France. These are the West's "proxies" and they have not advanced their countries in the least – neither in self-sufficiencies nor in genuine democratic or developmental milestones. Indebted to 'Empire's' patronage, these states form the regional arm of the Neo-Colonial Axis.
On the other side of the Mideast's geopolitical fault line, Iran has set the standard for the Post-Colonial Axis – often referred to as the 'Resistance Axis.' Based on the inherent anti-imperialist worldview of the 1979 Islamic revolution, and also as a result of US/UK-driven isolating sanctions and global politics, Tehran has bucked the system by creating an indigenous system of governance, advancing its developmental ambitions and crafting alliances that challenge the status quo.
Iran's staunchest allies have typically included Syria, Hezbollah and a handful of Palestinian resistance groups. But today, in the aftermath of the Arab Spring counter-revolutions – and the sheer havoc these have created - other independent players have discovered commonalities with the Resistance Axis. In the region, these include Iraq, Algeria and Oman. While outside the Mideast, we have seen Russia, China and other non-aligned nations step in to challenge the Neo-Colonial order.
Neo-Colonial Axis hits an Arab Spring wall
Today, the Neo-Colonials simply can't win. They lack two essential components to maintain their hegemony: economy and common objectives.
Nowhere is that more clear than in the Middle East, where numerous initiatives and coalitions have floundered shortly after inception.
Once Muammar Gaddafi was overthrown in Libya, all parties went their own way and the country fractured. In Egypt, a power struggle pitted Sunni against Sunni, highlighting the growing schism between two Gulf Cooperation Council (GCC) patrons Saudi Arabia and Qatar. In Syria, a heavyweight line-up of Turkey, Qatar, Saudi Arabia, France, the US and UK could not pull together a coherent regime-change plan or back the same horse.
In the vacuum created by these competing agendas, highly-organized al-Qaeda-style extremists stepped in to create further divergence among old allies.
Western hegemons – the original colonials and imperialists – grew fatigued, alarmed, and sought a way out of the increasingly dangerous quagmire. To do so, they needed to strike a compromise with the one regional state that enjoyed the necessary stability and military prowess to lead the fight against extremism from within the region. That would be their old adversary, Iran.
But the West is geographically distant from the Mideast, and can take these losses to a certain extent. For regional hegemons, however, the retreat of their Western patrons was anathema. As we can see, Turkey, Saudi Arabia and Qatar have recently rushed to resolve their differences so they can continue to design the region's direction in this Western vacuum.
These counter-revolutionary states, however, share grandiose visions of their own regional influence - each ultimately only keen to achieve their own primacy. And the continued ascendance of Iran has really grated: the Islamic Republic seems to have moved from strength to strength during this 'Arab Spring,' picking up new allies – regional and global – and consolidating its gains.
ce trooper walks in a creater caused by an air strike on houses near Sanaa Airpor
For Saudi Arabia, in particular, Iran's incremental victories go beyond the pale. Riyadh has, after all, staked its regional leadership role on a sectarian and ethnic divide, representing Arab and Sunni stakeholders against "Iranian" and "Shiite" ones. Now suddenly, not only are the Americans, British and French dallying with the Iranians, but the GCC itself has been split down the center over the issue of 'engagement vs. confrontation' with the Islamic Republic.
Worse yet, the Saudi efforts to participate in the overthrow of Gaddafi, squash uprisings in Bahrain, control political outcomes in Yemen, destabilize Syria, divide Iraq and conquer Egypt seem to have come to naught.
In all instances, they have yet to see cemented, meaningful gains – and each quagmire threatens to unravel further and deplete ever more Saudi funds
Today, the Saudis find themselves surrounded by the sickly fruits of their various regional interventions. They have endured recent attacks by violent extremists on their Iraqi and Jordanian borders – many of these recipients of past Saudi funding – and now find themselves challenged on a third border, in Yemen, by a determined constituency that seeks to halt Saudi interventions.
Beyond that, Syria and Lebanon have slipped out of Riyadh's grip, little Qatar seeks to usurp the traditional Saudi role in the Persian Gulf, Egypt dallies with Russia and China, and Pakistan and Turkey continue a meaningful engagement with Iran.
Meanwhile, the Iranians don't have to do much of anything to raise the Saudi ire. Iran has stepped up its regional role largely because of the Saudi-led counter-revolution, and has cautiously thwarted Riyadh's onslaughts where it could. It has buoyed allies – much like NATO or the GCC would in similar circumstances – but with considerably less aggression and while cleaving to the letter of international law.
The Saudis see Iranian hands everywhere in the region, but this is a fantasy at best. Iran has simply stepped into an opportunity when it arises, meet the threats coming its way, and utilize all its available channels to blunt the Saudi advances in various military and political theaters.
Even the US intelligence community's annual security assessment – a report card that regularly highlights the "Iranian threat" - concludes in 2015 that the Islamic Republic of Iran has "intentions to dampen sectarianism, build responsive partners, and deescalate tensions with Saudi Arabia."
Yet all we hear these days blaring from Western and Arab media headlines is "Shia sectarianism, Iranian expansionism and Persian Empire."
Tellingly, the American intelligence assessment launches its section on "terrorism" with the following: "Sunni violent extremists are gaining momentum and the number of Sunni violent extremist groups, members, and safe havens is greater than at any other point in history."
And US officials admit: many of these Sunni extremists have been assisted and financed by no other than Washington allies Saudi Arabia, Turkey and Qatar.
The Yemeni theater – a final battleground?
A senior official within a Resistance Axis state tells me: "The biggest mistake the Saudis made is to attack Yemen. I didn't think they were that stupid."
In the past week, the Saudis have cobbled together yet another Neo-Colonial 'coalition' – this time to punish Yemenis for ousting their made-in-Riyadh transitional government and pushing into the southern city of Aden.
The main Saudi adversaries are the Houthis, a group of northern, rural highlanders who have amassed a popular base throughout the north and other parts of Yemen over the course of ten years and six wars.
The Saudis (and the US) identify the Houthis as 'Shiites' and 'Iranian-backed' in order to galvanize their own bases in the region. But Iran has had little to do with the Houthis since their emergence as a political force in Yemen. And WikiLeaks showed us that US officials know this too. A 2009 cable from the US Embassy in Riyadh notes that Yemen's former Saudi-backed President Ali Abdullah Saleh provided "false or exaggerated information on Iranian assistance to the Houthis in order to enlist direct Saudi involvement and regionalize the conflict."
And allegations that Iran arms the Houthis also fall flat. Another secret cable makes clear: "Contrary to ROYG (Republic of Yemen Government) claims that Iran is arming the Houthis, most local political analysts report that the Houthis obtain their weapons from the Yemeni black market and even from the ROYG military itself."
Saleh was deposed in 2011 as a result of Arab Spring pressures, and in a twist worthy of the complicated Middle East, the wily former president now appears to be backing his former adversaries, the Houthis, against his old patrons, the Saudis.
The Houthis are adherents of the Muslim Zaydi sect – which falls somewhere between Sunnism and Shiism, and is followed by around 40 percent of Yemenis. Saleh, who fought the Houthis in half a dozen wars, is also a Zaydi – evidence that Yemen's internal strife is anything but sectarian.
In fact, it could be argued that the Houthi – or Ansarallah movement – are a central constituency of Yemen's 'Arab Spring.' Their demands since 2003 have, after all, largely been about ending disenfranchisement, gaining economic, political and religious rights, eliminating corruption, railing against the twin evils of America and Israel (a popular Post-Colonial Arab sentiment), and becoming stakeholders in the state.
To ensure the balance continued in their favor during the Arab Spring, the Neo-Colonial Axis installed a puppet transitional leader upon Saleh's departure – an unelected president whose term ran out a year ago.
Then a few months ago, the Houthis – allegedly with the support of Saleh and his tens of thousands of followers – ousted their rivals in the puppet regime and took over the Yemeni capital, Sana'a. When the Saudis threatened retaliation, the Houthis pushed further southward…which brings us to the war front amassing against Yemen today.
This is not a battle the Saudis and their Neo-Colonial Axis can win. Airstrikes alone cannot turn this war, and it is unlikely that Riyadh and its coalition partners can expect troops on the ground to be any more successful - if they are even deployed.
The Houthis have learned over the past decade to fight both conventional and guerilla wars. This relatively small band of highlanders managed in 2009 to push 30 kilometers into Saudi territory and take over several dozen Saudi towns. When coalition-partner Egypt last fought a war with ground troops in Yemen, it became Gamal Abdel Nasser's 'Vietnam' and nearly bankrupted the state.
Even majority-Sunni Pakistan, a traditional pipeline for staffing GCC armies, seems wary about this conflict. It too is fighting elsewhere on the same side as the Houthis, Iranians, Syrians, Iraqis – against violent Sunni extremists inside its borders and from their bases in neighboring Afghanistan. No amount of Saudi money will quench the anger of militant-weary Pakistanis if their government commits to this Yemeni fight – against the very groups (Houthis) that are battling al-Qaeda in the Arabian Peninsula (AQAP).
And, yes, it is ironic that the United States is now providing assistance and intelligence for the Saudi-led coalition - against the Houthis, who are fighting al-Qaeda.
But as mentioned earlier, this is not Washington's neighborhood, and it does not approach this fight with the same goals of its close ally, Saudi Arabia.
The Resistance Axis official explains:
"The Americans see all outcomes as good: If the Houthis win, they will help get rid of al-Qaeda in Yemen. If the Saudis win, well, these are still the US's allies. And if both sides enter a protracted war, that is "not a problem either," referring to the ever-present US interest of selling weapons in conflict zones.
Despite a global ban, the United States has sold the Saudis $640 million worth of cluster bombs over the past two years, some of which have been used to carpet bomb parts of Yemen in the past few days. The cluster munitions were part of an overall $67 billion worth of arm deals with Saudi Arabia since the Arab uprisings kicked off in 2011.
The Iranians, meanwhile, are not doing much of anything, except insisting – like the Russians and others – that the bombardment of Yemen is criminal and that Yemenis need to solve their own problems via an internal dialogue.
And why should they make any moves? The Saudis are digging their own graves right now – and hastening the demise of the entire Neo-Colonial project in the Middle East, to boot.
"Tehran realizes that the fact that Riyadh had to bring together a major coalition to fight a group that is only on the outskirts of Iranian influence is a victory in itself," says the US-based, conservative risk-analysis group, Stratfor.
Riyadh's move to attack Yemen has just dragged the not-so-financially-flush Kingdom into yet another military quagmire, and this time directly, bypassing proxies altogether. Every airstrike in Yemen – and it is clear in the first few days that dozens of civilians, including children, have been killed – threatens to draw more adherents to the Houthi cause.
And every day that the Houthis are tied up in this battle, AQAP gets an opportunity to cement its hold elsewhere in the country. The net winner in this conflict is unlikely to be Saudi Arabia, but it may just be al-Qaeda – which is guaranteed to draw the Post-Colonial Axis into the strategically vital waterways surrounding Yemen.
The Arab League, under Saudi Arabia's arm-twisting, just upped the ante by demanding that only a complete Houthi surrender (laying down weapons and withdrawing) would end the airstrikes. This ultimatum leaves very little room to jumpstart dialogue, and shows shocking disregard for the normal goals of military engagement, which try to leave 'negotiation windows' open.
It may be that the Saudis, who have rapidly lost influence and control in Syria, Iraq, Lebanon, Oman, and other states in the past few years, have decided to go to the wall in Yemen.
Or it may just be some posturing to create momentum and bolster bruised egos.
But conflict has a way of balancing itself out – as in Syria and Iraq – by drawing other, unforeseen elements into the fray. With all the conflicts raging in the Middle East and encroaching on their borders, the Post-Colonial Axis has been forced to take a stand. And they bring to the field something their adversaries lack: common objectives and efficiency.
This is possibly the first time in the modern Mideast we have seen this kind of efficiency from within. And I speak specifically of Iran and its allies, both regional and external. They cannot ignore the threats that emanate from conflict, any more than the west can ignore the jihadi genie that threatens from thousands of miles away. So this Post-Colonial Axis moves further into the region to protect itself, bringing with it lessons learned and laser-focused common goals.
The Neo-Colonials will hit a wall in Yemen, just as they have in Syria, Iraq and elsewhere. Their disparate objectives will ensure that. The main concern as we enter yet another storm in Yemen is whether a flailing Empire will turn ugly at the eleventh hour and launch a direct war against its actual adversary, the Post-Colonial Axis. The Saudis are a real wild card - as are the Israelis - and may try to light that fuse. When the threat is existential, anything goes.
Yes, a regional war is as much a possibility over Yemen as it was over Syria. But this battle lies on a direct border of Saudi Arabia - ground zero for both violent extremism and the most virulently sectarian and ethnocentric elements of the anti-Resistance crowd - and so promises to deliver yet another decisive geopolitical shift in the Mideast. From Yemen, as from any confrontation between the two global blocs, a new regional reality is likely to emerge: what the Americans might call "the birth pangs of a new Middle East."
And Yemen may yet become the next Arab state to enter a Post-Colonial order.
The statements, views and opinions expressed in this column are solely those of the author and do not necessarily represent those of RT.
