Libya: The After Dinar Mint

Gaddafi - Photo provide by bikyamasr.com

(Originally published at the DailyCensored.org for Project Censored.)

Under the War Powers Resolution of 1973, the President of the United States may order troops into combat for 60 days without seeking congressional approval. On May 20, 2011, 60 days after the attacks on Libya began, Obama sent a letter to Congress stating that while he would like them to support the U.S. military actions in Libya, he was not asking for congressional authorization. Essentially, Obama began unilaterally asserting what he apparently believes is the president’s inherent executive power to wage war. This is the same executive power many on the left went bonkers over when George W. Bush asserted his executive powers to perpetrate illegal renditions and enhanced interrogation techniques. But why is Obama going through such lengths to avoid congressional approval for the NATO bombings in Libya?

The reasons given for why the U.S. and her NATO allies decided to go to war with Libya are complex. However, the two reasons most cited are that we went to war with Libya to end the slaughter of a thousand anti-Gaddafi freedom fighters and their supporters. The second reason given as to why we decided to enforce a “no-fly zone” and the bombardment of Libya is the more cynical and predictable reason, oil. However, a third and even more cynical and less predictable reason why the U.S. and European nations have attacked Libya is MONEY.

Consider first the most common reason given as to why we are bombing Libya.  Prior to the U.S. led NATO bombing of Libya, there is no doubt that Gaddafi had ordered his troops to use violence to put down the peaceful protesters. Yet, as I write this article, the Syrian, Yemen and Bahraini governments are currently using violence against peaceful protesters and no one is calling for the bombing of these nations.  Like in Libya, all three of these nations have been using live ammunition and brutal force to squelch uprising. It is not a stretch to think the reason NATO has not attacked Syria, Yemen and Bahrain is because these governments have been friendly to the U.S. And so clearly, the standard is different. Nonetheless, there must be something more than just the fact that Gaddafi and the U.S. are not BFF.

What about the claim that the U.S. and NATO are attacking Libya to gain control of the oil? It is hard to see how Libya’s oil is of vital interest to the U.S. Libya produces less than 2 percent of the world’s oil. In Europe it is a different story. Both Italy and Ireland get nearly 25 percent of their oil from Libya. It is believed that Libya has the largest oil reserves in Africa and most of the oil is considered to be of a very high quality. However, the U.S. has very little interest in Libya’s oil.

The government of Libya controls all the current oil contracts and Gaddafi used state funds for his own personal piggy bank. Once Gaddafi is overthrown, which might take days, months, or years, the newly formed government will inherit the oil contracts. There is a lot of money to be made in those oil contracts, but as Iraq has taught us, not enough to justify a war. And let’s not be fooled into thinking the U.S. its NATO allies are NOT once again engaged in a NEW WAR. Just yesterday, NATO authorized the use of Apache attack helicopters. Another clear sign of mission creep.

So if oil revenues won’t pay us back for the cost of the war, what other interests do the U.S. and NATO have in the war in Libya? Some claim the reason we are at war with Libya boils down to money. John Perkins is the author of the bestselling book, “Confessions of an Economic Hit Man,” in an April 2011 article published in Information Clearing House, he explains the money connection:

“According to the IMF, Libya’s Central Bank is 100% state owned. The IMF estimates that the bank has nearly 144 tons of gold in its vaults. It is significant that in the months running up to the UN resolution that allowed the US and its allies to send troops into Libya, Muammar al-Gaddafi was openly advocating the creation of a new currency that would rival the dollar and the euro. In fact, he called upon African and Muslim nations to join an alliance that would make this new currency, the gold dinar, their primary form of money and foreign exchange. They would sell oil and other resources to the US and the rest of the world only for gold dinars.”

Perkins suggests that the main reason for the war in Libya is to end Gaddafi’s plans to have the Middle East and African nations using the gold dinar to compete with the U.S. dollar and European Euro. Gaddafi has created his own banking system that has investments world wide. Gaddafi’s banks are heavily involved in investing in African nations that are working to get out from under the thumbs of the U.S. controled World Bank and the European controlled International Monatary Fund.

Interestingly, in an article published in Truthout, Ellen Brown collects several comments from ecomonic policy makers and journalist that had noticed within days of the Libyan uprising, the handfull of poorly armed insergents had already created their own central bank, located in the rebel stronghold of Benghazi.

For example, here is a comment published in mid-March 2011, “CNBC Senior Editor John Carney asked, “Is this the first time a revolutionary group has created a central bank while it is still in the midst of fighting the entrenched political power? It certainly seems to indicate how extraordinarily powerful central bankers have become in our era.”

And, Robert Wenzel posted this comment at the Economic Policy Journal: “I have never before heard of a central bank being created in just a matter of weeks out of a popular uprising. This suggest we have a bit more than a rag tag bunch of rebels running around and that there are some pretty sophisticated influences.”

In Perkins’ article, he explains that throughout the history of empires, dominatant nations control the currency, most famously the ancienct Romans. While most of the world’s oil comes from outside the U.S., oil is traded in U.S. dollars. Gaddafi wanted to change that arrangement. As Perkins points out, “So, we might ask ourselves: What happens when a “rogue” country threatens to bring the banking system that benefits the corporatocracy to its knees? What happens to an “empire” when it can no longer effectively be overtly imperialistic?”

Given the course of recent events, it doesn’t look like that question is going to be answered any time soon. The question is now, after Gaddafi and the gold dinar, who will be the next tyrant to make a mint on Libya’s banking system and natural resources?

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