Should We Impoverish the Persian Gulf?

Terry Jeffrey

5/8/2008 12:01:00 AM - Terry Jeffrey

A curious consensus has formed among the presidential candidates that promoting the use of alternative fuels should not only be the policy of the United States in fighting "climate change" but also -- insofar as it would diminish the wealth of Persian Gulf states -- in fighting terrorism.

The argument has visceral appeal. Barack Obama may never find bitter people clinging to guns and religion, but he will find them clinging to the hoses of gas pumps as they fill their cars with $4-per-gallon fuel.

"We know that the money that America spends on foreign oil is funding both sides of the war on terror; that it pays for everything from the madrassas that plant the seeds of terror in young minds to the Sunni insurgents that attack our troops in Iraq," Obama said in October, laying out his energy plan. "We know this money corrupts budding democracies and allows dictators from hostile regimes to threaten the international community."

John McCain made virtually the same argument in December in his own energy speech. "Al-Qaida must revel in the irony that America is effectively helping to fund both sides of the war they caused," he said. "As we sacrifice blood and treasure, some of our gas dollars flow to the fanatics who build the bombs, hatch the plots, and carry out attacks on our soldiers and citizens. Iran made over $45 billion from oil sales in 2005, and it is the No. 1 state sponsor of terrorism.

"The transfer of American wealth to the Middle East helps sustain the conditions on which terrorists prey," he said.

Nor was Hillary Clinton to be left out. "We are more dependent on foreign oil today than we were on 9-11," she said in November, explaining her own energy policy. "And one-third of our trade deficit is the petroleum we import, as we transfer massive amounts of wealth to undemocratic governments that use those funds to stifle opposition and finance extremism."

A cheaper, cleaner, more secure source of fuel for America would be good in its own right. But if some entrepreneur discovered tomorrow a fuel that could be manufactured within the United States, wholly replace our petroleum consumption and give U.S. producers a commanding position in the global energy market -- thus beggaring the Persian Gulf -- would that choke off funding for al-Qaida and other terrorist groups and end their war against us?

Would it stop Iran from building a nuke? Would it spur positive political change in the Middle East?

The most reasonable answers to these questions are: no, no and no.

Terrorism, unfortunately, is inexpensive. "Al-Qaida," said the 9-11 commission staff report on terrorist financing, "funded a number of terrorist operations, including the 1998 U.S. embassy bombings in East Africa (which cost approximately $10,000), the 9-11 attacks (approximately $400,000 to $500,000), the Oct. 18, 2002, Bali bombings (approximately $20,000) and potential maritime operations against oil tankers in the Strait of Hormuz (approximately $130,000)."

Even with "overhead" factored in, the commission said, al-Qaida's annual budget was only $30 million per year. Some Major League Baseball players earn as much in a six-month season as Osama bin Laden needed to run al-Qaida in the six months before 9-11.

If Americans gave up oil, Islamist fanatics could still afford mass murder.

Poor countries can build nukes, too. The CIA's World Fact Book says North Korea's "industrial capital stock is nearly beyond repair as a result of years of underinvestment and shortages of spare parts." Its total government budget in 2006 was $2.2 billion, about one-twentieth the value of the oil revenue John McCain attributes to Iran for 2005. Yet, in 2006, North Korea tested a nuclear device.

This leaves the question of whether impoverishing the Persian Gulf would foster positive political change there. Well, one oil-dependent economy in that region is Iraq, where American troops are now giving their lives to prevent -- not cause -- a civil war.

Aside from Shiite Islamist revolutionary Iran, which has been antagonistic toward the United States ever since the overthrow of the Shah in the late 1970s, all the rest of the major oil-producing states of the Gulf -- Kuwait, Bahrain, Saudi Arabia, Qatar and the United Arab Emirates -- are Sunni Arab emirates or monarchies with Shiite minorities. All are un-free -- and all have a history of military cooperation with the United States.

Are we anxious to see how revolution unfolds in these places? Would political change sparked by economic dislocation bring them closer to, or further from, al-Qaida's ideology?

The presidential candidates may want to compel Americans to use alternative fuels because they believe the world is overheating, but suggesting this will help protect us against terrorism is solid evidence their rhetoric is overheating.