The Economics of the Indo-Pacific Pivot

As I have said before, all war is about economic considerations and fought by people with few economic consideration.

Much has been said, in our pivot towards the Asian Pacific, about the people with few economic considerations.

We have heard about the saber-rattling of China in the disputed South China Sea and elsewhere.  This saber-rattling doesn’t really seem to be much about economics. Perhaps now is the time we need to talk about the economic considerations in the Pivot.

Basically, economically we are going to do for those nations under our Indo-Pacific pivot what we did for the Middle East. We are going to use our military to uphold the relevancy of the US dollar.

Perhaps the quip used by one of the characters in the movie “Tinker, Tailor,  Soldier,  Spy” can be used to clarify what I mean by “doing” to the Indo-Pacific what we did for the Middle East.

In the movie there was a change of leadership in the “Circus”. The Circus is where  the odd performers of the British secret service get together and put on a show for everyone else in the Service to see. The new Ringleader, to show his knowledge of how things are in the world made the statement that, “you can rent an Arab, but never buy one.”

I don’t know if that statement is true or not, but by literally throwing billions of dollars into the environment of Iraq, after our invasion,  we “rented” thousands of Arabs. (I know the dollars in my wallet are mainly there for me to rent. They never stay in my wallet long enough to actually own.)

In other words, economics is not just about interest (which collecting interest is not popular in most areas of the Middle East) but a strong economy also depends a great deal on whose hard currency runs the show.

While there were many reason made for going to war in Iraq, strategically it was in the US’s interest to make sure “petrol dollars” also meant the US dollar.

As many experts have said, the Iraq war wasn’t about the US grabbing Iraq’s oil. The US doesn’t get its oil from the Middle East. The oil coming out of the Middle East is mostly going to China and other developing nations.

But what is important,economically for the US is that whoever buys oil in the Middle East uses US dollars. The US economy depends on the fact that they do.

With Turkey threatening to join the EU, France heavily into buying oil from Saddam, and rumors of Russia and China making gold the currency for oil, the relevancy of the US dollar was disappearing. I suggest that is no longer true.

While all strategy is flawed, and there is an on-going civil war throughout the Middle East, in the most part the US currency is still “the” currency of the world.

My guess is that the US dollar is the most relevant it has ever been in the Middle East, but the same cannot be said in the Asian Pacific.

http://www.ibtimes.com/sorry-mates-strictly-business-australia-wants-cut-out-us-dollar-trade-china-1161287#

A 1.6 billion infusion of US dollars and an occupation of US Marines may counteract that train of thought.

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