The Armed Madhouse  

Greg Palast has another of his trademark rants out - this time taking a look at the contentious subject of immigration in what he calls the loser nation. I'm not sure trying to combine occasional serious journalism with wildly partisan rants is all that good an idea if he ever wants to be taken seriosuly outside of a select audience, but he is entertaining.

Looking out at today's temptest-tossed masses of protesting immigrants, the wretched refuse just looking for a break, I finally figured out what's wrong with George Walker Bush. He's so far away from his refugee loser roots that he just doesn't get what it is to be American. So he steals the one thing that every American is handed off the boat: a chance. It's not just the immigrants denied a green card. When Bush threatens to take away your Social Security; when Bush's oil wars hike the price of crude and threaten your union job at the airline; when Bush tells you sleeper cells are sleeping under your staircase, you don't take chances anymore -- you lose your chance -- and the land of opportunity becomes a landscape of fear, an armed madhouse.

The immigration subject is an interesting one, given how it seems to cut across traditional right / left lines - "progressive" Thom Hartmann thinks unchecked immigration is a threat to the working conditions of the American middle class, for example, which the (presumbaly "socialist") "Socialist Worker" is thoroughly unimpressed with. Typical "liberals" like Jonathan at Past Peak, on the other hand, take the view that immigrants are good and shouldn't be demonised, let alone legislated against. On the right, you have the traditional anti-immigrant redneck/racist vote that seems to have a lot of politicians pandering to it, while the big business lobby tends to support open borders and immigration as it keeps labour costs down.

No wonder the issue is such a confused one.

As for me, having spent my adult life in large, multicultural cities, I like immigrants and diverse societies - but I don't expect everyone to share this view (you don't have to be racist to want a homogenous society, nor is it necessarily wrong to want to keep the labour pool relatively shallow) and I think immigration policy should be decided democratically - preferably without too much ugly politicking going on. I do find the whole border militarisation thing to be appalling though.

Past Peak also has an interesting post on the US-Mexico "income gradient", which explains the underlying cause of the immigration "problem".

Here's why an enforcement approach will never stop illegal immigration from Mexico, the source of 70% of all illegal immigration into the US (WaPo):

"The income gap between the United States and Mexico is the largest between any two contiguous countries in the world," writes Stanford historian David Kennedy. That huge disparity is producing massive demand in the United States and massive supply from Mexico and Central America. Whenever governments try to come between these two forces — think of drugs — simply increasing enforcement does not work.

Nature abhors a gradient

Iran's surprise announcement that it has enriched uranium (but is still a long way off having the capacity t create nuclear power plant fuel, let alone nuclear weapons), would seem to be designed to inflame tensions, especially given the recent publication of Seymour Hersh's article on US plans to attack. They're either feeling confident enough to call the neoconservative bluff or they are somewhat recklessly playing chicken.

Predictably the IAEA has asked for enrichment to be suspended while the Bushies are rattling sabres, and predictions are being made of a looming showdown. It is certainly helping the oil price head back towards record highs, which will unsurprisingly gladden both the Iranians and many Bush supporters. Rising US stockpiles are keeping a lid on the price though, and there are even predictions the price will drop over the northern summer if geopolitical tensions ease.

Oil declined yesterday after the Energy Department said U.S. stockpiles gained 0.9 percent to 346 million barrels last week, the highest since May 1998. Prices also fell after failing to close above their high this year of $69.20, reached on Jan. 23, analyst Dariusz Kowalczyk said. ``There was a bigger run-up in inventories than expected, which is bearish for crude,'' said Kowalczyk, senior investment strategist at CFC Seymour Ltd., a Hong Kong-based securities company. ``The January high is providing technical resistance.''

The May contract declined 36 cents, or 0.5 percent, to $68.62 yesterday after reaching an intra-day high of $69.60, the highest since Sept 2 after Hurricane Katrina close platforms, pipelines and refineries in the U.S. Gulf region.

Oil has risen 10 percent in the past month on that concern that the international dispute over Iran's nuclear research program will cut supplies from Iran's fourth-largest producer. ``We are drifting a little bit after a pretty big run-up,'' Tom Bentz, an oil broker with BNP Paribas Commodity Futures Inc. in New York said yesterday. ``It's only a matter of time before we break through $70.85 and then head to the mid-$70s.''

Attacks by militants against oil installations in Nigeria, Africa's biggest oil producer, shut down about 631,000 barrels a day in output in February and March, or about 25 percent of the country's production.

Moving from oil to gold, the Daily Reckoning is pushing the idea of "peak gold". I don't really buy this idea, but even if it were true, "so what" is my response - its not like gold is consumed after it is mined, unlike oil.

Coaxing the precious stuff out of grudging ground, under the noses of wicked politicians is one thing both mining companies and oil companies are good at. But for both, the work only seems to be getting harder.

“You can’t get drill rigs, you can get workers. You can’t get skilled workers,” says John Hathaway of the Tocqueville Gold Fund. “The time that it takes to put in a new mine is longer than ever. Because of the environmental standards and the hoops you have to jump through on that, some of these things will never get built.”

Earlier, we raised the possibility of ‘Peak Gold’ – the idea that gold production is now near its maximum level, and that from here on out new production will be flat or declining – in a previous Daily Reckoning. As is the case with oil, the easy stuff has already been taken.

There were gold mines in Virginia in the early 1800s...then, gold production moved to less hospitable areas – such as California! When that played out, it was on to Peru and deep into South Africa. Likewise, getting oil from Pennsylvania or Texas was a relatively simple matter. Getting it from Nigeria and Venezuela is another matter altogether.

Peak Oil poses major problems for the world economy. As currently constructed and operated, the world needs oil – and lots of it – just to keep going. As supplies tighten, prices rise. Today’s Financial Times tells us that the price of gasoline is likely to be $2.62 per gallon in the US this summer – 25 cents more than the year before. What will vacationers do? Walk the last few miles?

Peak Gold, on the other hand, poses no such problems. The price of gold soars without doing any particular damage to consumers. Most aren’t even aware of it.

Moving on to one of my favourite topics - propaganda - the Herald had a good report this week on role of the mysterious, evil and seemingly omnipresent Abu Musab Al Zarqawi in Iraq - as seen through the media lens in the West (covered previously by Billmon - several times, Juan Cole, Source Watch, TomDispatch, the Asia Times and, on a tinfoil note, RI).

The US military is conducting a propaganda campaign to magnify the role of the leader of al-Qaeda in Iraq, according to internal military documents and officers familiar with the program.

The effort has raised his profile in a way that some military intelligence officials believe may have overstated his importance and helped the Bush Administration tie the war to the organisation responsible for the September 11 terrorist attacks.

The documents say that the US campaign aims to turn Iraqis against Abu Musab al-Zarqawi, a Jordanian, by playing on their perceived dislike of foreigners. US authorities claim some success with the effort, noting that some tribal Iraqi insurgents have attacked Zarqawi loyalists.

For the past two years US military leaders have been using Iraqi media and other outlets in Baghdad to publicise Zarqawi's role in the insurgency. The documents explicitly list the "US home audience" as a target of a broader propaganda campaign.

Some senior intelligence officers believe Zarqawi's role might have been overemphasised by the propaganda campaign, which has included leaflets, radio and television broadcasts, internet postings and at least one leak to an American journalist.

Although Zarqawi and other foreign insurgents in Iraq have conducted deadly bombing attacks, they remain "a very small part of the actual numbers", Colonel Derek Harvey, who served as a military intelligence officer in Iraq, told an army meeting in Kansas last year.

In a transcript of the meeting, Colonel Harvey said, "Our own focus on al-Zarqawi has enlarged his caricature, if you will - made him more important than he really is, in some ways."

Of course, this sort of reporting is just the sort of thing that makes Rummy grumpy.

Moving back to energy news, China's "Peoples Daily" reports on a new South American gas pipeline proposal to distribute Bolivian gas.

The presidents of Bolivia, Paraguay, Uruguay and Venezuela will discuss the feasibility of a gas pipeline project at a meeting in Paraguay next Wednesday, local media reported on Tuesday. The leaders will discuss the construction of a gas pipeline linking Bolivia to the other three countries during the talks.

Venezuelan President Hugo Chavez said on Sunday that Venezuela would support infrastructure construction and other works of the pipeline. Uruguay and Paraguay import 50,000 barrels of crude oil a day from Venezuela at preferential prices. Bolivia also receives 200,000 barrels of Venezuelan diesel every month.

In Africa, Chad seems to be suffering from the curse of oil, with rebels attempting to overthrow the government (who are being actively supported by French forces).

Chad is currently ranked in the bottom five out of nearly 180 nations rated by the United Nations in its annual human development index assessment. Yet the country has one major source of wealth - oil - and it has only started to be tapped in the last few years.

As so often in Africa, political tensions are in part a scramble for who gets the income from mineral wealth. Chad has been exporting oil on a significant scale since 2003. Inevitably, some of the money has been spent on arms.

It is reckoned to have reserves of up to one billion barrels. That's not large in comparison to major oil producers in Opec, but by local standards the potential spoils are vast.