America’s Serious Strategic Miscalculations vis-à-vis Iran


by ayatoilet1

For those of you that regularly read items on looking for some real insight into the U.S. – Iran relationship, let me state once and for all – the U.S. really doesn’t really care about Iran per se. It cares primarily about Russia and China. But, what happens in Iran is tied to these primary interests - as a result Iran matters – only indirectly.

Furthermore it is pretty clear now that U.S. really screwed up in its calculations in the Middle East – and especially Iran - to the extent that it has actually emboldened China. This blog explores this premise in detail.

But, before I begin this exploration, I want to state for the record that I have no patience for Monday morning quarter backs that are so smart after the game. I hate those should of, could of specialists. Very often decisions are made with the facts in hand, and risks have to be taken – because to not act is sometimes the lesser of two evils.

But there is value in ‘game reviews’ for players. In the British Premier (soccer) League these days there are 8 cameras recording every move. PhD statisticians are on major team payrolls and a lot of postgame analysis occurs in order to avoid future mistakes and improve performance. When winning can cost literally hundreds of millions of dollars, it is worth doing everything to get it right.  In the case of the ‘great game’ going on in Central Asia and the Middle East, I would argue every effort should be made to get it right. My intentions in writing this are to help this analytical process.

Let’s start by rolling back to 2001. George W. Bush (Dubya) gets elected and coming from an Oil family dynasty with a Vice President who resigned from the Presidency of a major Oil Services firm (Haliburton) they had oil and energy policy at the forefront of their minds in applying America’s strategic imperatives.

Not unreasonably, America’s key strategic challenge since the seventies (and still today) has been dealing with dual issue of managing the Russian Bear and taming the Chinese tiger. In many ways, US-China relations is more important than US-Russian relations – because, it has been argued peeling China away from Russia is an effective means of dealing and containing Russian power.

With a roaring economy poised to become the world’s largest economy by 2020 (yes, 8 years away), China sits at the precipice of becoming the world’s most powerful “super-power” (which comes with wealth accumulation). The Chinese government is already America’s and Europe’s largest lender (i.e. buyer of treasury bills) and retains a massive trade surplus with everyone. How does the U.S. avoid a loan call from its master lender? Or to put it the way Dubya thinks: “They have our balls in their hands, and how do we stop them from squeezing?”

With China being a huge net energy importer, Dubya bought into the strategy of taking over all the world’s oil and gas fields and using these resources as leverage to “tame the Chinese tiger”. With the entire world’s energy in Dubya’s hands, America too had Chinese balls in its hands and the Chinese would be pleading for America NOT to squeeze (he figured).

It all sounded good. But as with all strategic thinking in the end it comes down to execution. The best strategies poorly executed turn out horribly. The big flaw, in my opinion has been the systematic execution of this strategy. 

First of all, China needed to become a major energy importer. Economic growth alone – does not directly mean addiction to Oil and Gas. Look at France, 80%+ of its electricity is generated by Nuclear Power Plants. And if you travelled to China 20 years ago, you would notice droves of Bicycles everywhere.  To implement this strategy, the Chinese needed to migrate to cars, and build fossil fuel power plants. GM, Ford, Daimler Benz, Volkswagen, etc. built major auto plants in China, and a whole host of suppliers set up shop in China to support the emerging Chinese Automotive industry.  Go to China today, and you’ll get stuck in a traffic jam. China is also, at the same time, commissioning one world-class multi-MW power plant every week!

Step two, was capturing the oil fields. Russia was broken up, the newly independent ‘stans’ were set up for oil exploration in the Caspian Sea (the world’s largest untapped oil and gas reserves),

The Shah of Iran had declared in 1978 that he would not be renewing the oil and gas concessions to a group of western oil companies. These new fields in the Caspian Sea surely could not be trusted in his hands. Thus, it was argued that Iran had to be isolated and impeded from making any territorial claims.  This analysis added more fuel to the fire and provided one more reason for toppling the Shah and imposing a religious government that would retard Iran and render it impotent in claiming any significant part of the Caspian Sea.

Recognizing this dynamic, the Chinese bid on one of the key players in the Caspian Sea – Unocal. And this bid was quickly squashed by the U.S. government. So as a backup strategy, the Chinese began investing in Iraq – with the world’s second largest oil and gas reserves. And the Russians too signed a 40 year contract with Saddam Hussein to exploit Iraqi oil fields.  

And it has been argued that this situation in Iraq left the U.S. with no option, but to invade Iraq to control the fields and keep the Russians and the Chinese (and by the way the French too) off the loot.

Dubya was not sophisticated enough to see ‘clever’ indirect routes for capturing Iraq’s oil reserves.  There were many options that Dubya simply did not or would not consider.  And this, precisely, was Dubya’s huge strategic miscalculation.

Before I explore all the other options Dubya had, let’s consider why he was pre-disposed to a direct attack option: 1)      Saddam Hussein had planned the murder of his father – and invading Iraq was not only considered to be in the interests of the U.S.; but would ultimately result in Hussein’s death.2)      He was told it would be easy -  a piece of cake - and that Iraqi’s would be lining the streets with flowers – thanking American soldiers for their liberation3)      He thought he had a slam dunk reason for invading (weapons of mass destruction) – which would give him legal standing4)      The U.S. had already had one major battle with Hussein (in Kuwait) and it was widely believed that the ‘job was left unfinished’

All these reasons appeared compelling. But the U.S. did have other options that now in retrospect may have been better suited to achieving the goal.

You have to remember that the march to war was started on the back of the September 11, 2001 attacks in the U.S.  And, that the primary response to these attacks was the invasion of Afghanistan.

Whether or not the attacks were staged to support America’s march to war, it is clear now that capturing Afghanistan played well into the “Taming the Chinese Tiger” strategy. The U.S. could (and is currently) building a pipeline from the Caspian Sea through Afghanistan; AND, control of Afghanistan provides a barrier to Western Chinese access to the warm water ports on the Arabian Sea.

But what U.S. planners did not foresee was that this “dual war” plan was and still is a huge burden on the U.S. and that there were smarter – by proxy ways of accomplishing the same goals without committing U.S. blood or treasure.

Whatever the benefits of these strategic moves, if the cost of execution becomes too high, the costs will (in the end) outweigh the benefits. The brilliance of the current Obama-Clinton Arab Spring strategy has been their incredible capacity to accomplish strategic goals by proxy at minimal cost to the U.S.. Almost all the ‘revolutions’ have occurred with indirect U.S. support and involvement.  US has freed something like 150 Million Arabs (that is 10 times the population of Iraq) at a cost not even1% of the cost of the Iraq war.

George W. Bush seemed to think the U.S. pockets were lined with unlimited cash. And like a cowboy he just crashed in, without really thinking about the consequences. And may I add that while he did In fact conquer Afghanistan and Iraq, by not dealing with Iran (then) he has left a major gap in America’s calculations that could undermine the whole strategy. Without dealing with Iran – both Afghanistan and Iraq’s wins are at risk.

It may be true that Dubya never really wanted to deal with Iran anyway. But, NOT dealing with Iran (whether intentional or not) was a strategic miscalculation.

First of all, there were really much lower cost options to execute the war – which Bush did not even consider.  The most efficient way to conduct these wars was to get (a transformed and allied) Iran to carry them out for the U.S. In some ways – this did happen when Iran turned over Afghanistan’s Northern Alliance (long financed and supported by Iran) to the CIA to assist in the Afghan campaign. And by all accounts, this resulted in an extremely successful campaign with Kabul being conquered very quickly and cheaply. The issue, of course, is that the U.S. could not ‘handle’ the post invasion phase. And actually, the Iranians have shown themselves to be excellent at doing precisely that – managing the post invasion phase. Iranians are building schools, clinics, roads in Western Afghanistan and we are told this is the most stable part of the country.  Iranians after all speak the language and know the customs. Iran too, could have taken over Baghdad in a heartbeat. Without Western support Saddam Hussein would have been impotent. And with the Majority of Iraq being Shia Muslim, again the post invasion phase would have been much easier for Iran.

Secondly, as it turns out, the combined wars (Iraq and Afghanistan) have cost the U.S. tax payer in excess of one trillion dollars and counting.  This is so embarrassing for the U.S. that it is very difficult to get a consensus on the true ‘direct’ costs of the war. There is also the ‘indirect’ cost of the war – which is the current dire economic situation in U.S. – the real estate debacle, the banking crisis, the global crisis – ALL really stem from policies designed to hide the true effects of the war. Dubya tried to keep the economy humming while he carried out the war – so he could maintain popular support for his policies. The impact of this downturn will have huge – MASSIVE – long-term effects on U.S. leadership.  The U.S. has had to borrow 6 Trillion dollars just to stay afloat, and is now further in debt to its ‘master’ china….to the tune of almost 2 Trillion dollars.

And thirdly, it could be argued that the U.S. does NOT have a long-term sustainable position in either country, and that in fact Iranian influence is very high and rising in both Iraq and Afghanistan. The U.S. has basically handed these nations to Iran. Iran now is both Iraq and Afghanistan’s most significant trading partner – despite increasing U.S. sanctions vis-à-vis Iran.

So in essence, a decision was made that cost the U.S. a hell of a lot of money, and deferred the handling of Iran to a later stage (if at all) and in fact Iran’s position has been enhanced NOT weakened by U.S. actions. This in a nutshell was Bush’s serious mistake.

Iran today, has excellent relations with China, and has become a major source of Chinese oil imports. During this period of sanctions on Iranian oil exports, Iran’s real exports to China have doubled.  

On the one hand, we have Israel pushing for an attack on Iran and the ‘break-up’ of Iran into a number of sub-ethnic states. On the other hand, there is this underhanded effort by the Europeans to maintain Iran – but contain it as a regional bully – helping drive arms sales, and the arms industry globally.

And the U.S. is somehow caught between these two arguments – paralyzed like a deer in headlights. There is no clear goal in sight. Iran policy has been a strategic disaster. And soon, Iran will be fully nuclear capable, and there will be no opportunity to do anything at all.

If Iran’s alliance with both China and Russia rise to a different level, they could seriously undermine U.S. presence in Afghanistan. And like so many Empires before them, America might have to put its tail between its legs and walk away …after having spent hundreds of billions of dollars there. The Europeans really don’t care – but the U.S. should.

I would argue that the U.S. should follow its own independent policy vis-à-vis Iran and realize that it has completely different strategic interests to the Europeans or the Israelis when it comes to Iran.  In fact, a transformed Iran – would be an excellent U.S. ally and provide a counter balance to the Chinese and help protect and maintain U.S. control of the region.  Iran can become a proxy keeper of U.S. interests in the region and help stabilize Iraq and Afghanistan.

10 years ago the U.S. should have invaded Iran first and then had Iran’s army do the dirty work in Iraq and Afghanistan. Now, it is the exact opposite, the U.S. should find a sweet way to ‘transform’ Iran and turn it into its ally to preserve its regional interests. There was a huge miscalculation then, and there is a big miscalculation now.

The U.S. has allowed its policies to be dictated by Jerusalem or Whitehall – but never really analyzed its own strategic interests and established its own goals. Iran and Iranians especially have been victims of this policy failure. Iraqis and Afghans too have been victims of this failure – because there is still a lot of bloodshed in those countries. The U.S. has NOT established a sustainable path to implement its regional policy and in turn ‘tame the Chinese Tiger’. The Chinese and Russians are sitting there laughing at America’s cowboy – hick driven- attitude. There has been NO sophistication in Washington.

The Mullahs too have played a good hand and preserved themselves for over 30 years. It is possible that much of this American paralysis has been driven by the Mullahs too.  After all they negotiated the Algiers accord in 1981 which essentially meant that the U.S. could do nothing to Iran (modeled on the Cuba Agreement).

Bottom line, the costs of empire keep ratcheting up. And America is carrying the ‘full load’ – and the Israelis and Europeans are sitting on the American tax payer like a donkey – using American blood and treasure to further their own private strategies and goals. BP now is the largest oil company in the Caspian region, and BP too controls the pipeline from Baku to Ceyhan in Turkey. Israel knows full well that if they attack Iran, the U.S. will have to come in and protect their behind…regardless of the costs.

America is pregnant. America is obligated. But America no longer has a sugar-daddy of 300 million tax payers that can afford these obligations. And the Chinese know it. The current policy U.S. is following in the region has already brought the U.S. down, and will continue to do so – unless there is a major change.

America can no longer operate unilaterally. If America is to preserve its dominance, it must do so with good strong allies. I would argue that a transformed Iran is the very best Ally the U.S. could want. To isolate, contain and ultimate lock up Iranians within a theocratic black hole – does not ultimately serve U.S. interests. It may serve the Europeans interests; it may serve Saudi Arabia’s interests; it may serve Chinese Interests, it may serve Russian interests – but NOT the U.S.

This is a major strategic miscalculation - and will utimately cost U.S. global dominance so many empires before it.


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Amir Parviz- Jan I have some questions

by ayatoilet1 on

With respect to Russia, it seems to me that so some extent there is an accomodation with them (by the West, U.S. in particular). For one thing, Russia just awarded Exxon their largest exploration contract in siberia (and took it away from the BP...and if you haven't read the papers, there is now a big court case in Russia about that). But also, Russian oil companies are fully vested in Caspian Sea exploration all the way down South in Azerbaijan etc. Moreover, in places like Syria, while the Russians are supporting Assad, they are NOT physically intervening (like say Iran is).

The Europeans on the other hand, are in fact in a feud with Russia, Right now the fight for Syria is really an effort by Israel and Europe to create the 'space' to bring a pipeline through Syria's north to connect to Turkey's Nabucco Pipeline; and at the same time bring two more lines to Nabucco (one from Qatar and another from Iraqi Kurdistan) and in essence create 'competition' for the Russians by having at least 3 more Gas suppliers into Europe. This is a DIRECT afront to Russia and Russian power projection. The U.S. is "supportive" but unwilling to play a primary role in the conflict. Turkey is the one doing the heavy lifting for the Europeans. U.S. played a similar role in Libya, Tunisia etc. (leading from behind). The U.S. was happy to see Gaddafi go, but realized that in the end the crumbs would fall with the expectation that some U.S. companies would end up winning some additional exploration contracts, but in the end it was all about getting North African Gas to Western Europe (across the Gibraltar Straits). Natural Gas production in Northern Europe has declined significantly, and France is decommissioning 50% of its Nuclear Power plants in the next 10 years. Gas supply is a critical issue.

Russia's economy pales to China's. In fact, China is creating the equivalent of a Russian economy every 5 years (even at its relatively modest 7 percent growth rate this year). No, I disagree, China is now more important. Not far behind these two is India and its projected growth in decades to come. And with India too, there is a new urgency to outline an Iran policy that makes real sense - beyond isolation and containment while maintaining tacit support for the mullahs. i.e. the status quo in Iran [minimizing Iranian interference and change] - while the West pillages all arround the country in Iraq, Afghanistan, Azerbaijan, Turkmenistan, Persian Gulf etc.

Instead of finding ways to engage Iran, the policy basicall is to "work arround it" - to achieve major policy goals. I don't think U.S. politicians lose much sleep on Russia, but they do stay up thinking about the impact of China and what the consequences would be if Israel picked a fight without their blessing.

The really funny thing is, that Israel a nation of 7 million, with a GDP not even the size of some of America's states (like New York) ...worries everyone more than China - with a Billion people and soone to be 20 Trillion dollar economy. I keep imagining these politicians up in bed in America wishing they could isolate and contain Israel while giving them tacit support (like the Mullahs) and keep it out of their calculations ...and then go back to sleep.


One of your better pieces, A

by amirparvizforsecularmonarchy on

I don't agree with alot of it, but many valid parts, its as if you read alot but don't speak with enough powerful & educated people who are the first source of the understandings you try and convey and you try your best to put it together, with what you know.

Russia not China is the US issue of the day.  The entire China policy and growth was to cleave China from Russia and it failed miserably.  China received all the trillion i help and then said thanks but under no forseeable circumstance.  China isn't an issue on its own at the moment, just because of its economy its overall development poses less of a geopolitical challenge than europe which EU27 are already larger than US economy and can replace the USA with Russian Help far far sooner than China.  Russia is Issue #1 for the USA, if you understand why this is the case, the you know why the US strategy for Iran was a failure from the very first day they betrayed the Shah and brought Khomeini to power.

The failure to cleave China has compounded this error.  Geopolitically in 5 years time the window to deal with russia will be over and the USA will no longer be a sole power, but a power unable to compete with its adversaries due to its own mistakes.  Russia will benefit the most from the USA siding with despotism/extremism for Iran and harming Iranian societies progress.  Russia will literally be able to play a more positive role as the USA will not be able to sustain this policy or have any way to benefit following another path and helping another team.  All great powers are built on long term alliances, the USA isn't going to benefit much from Saudi alliance and within Iran the USA has no alliance in the future as a result of its alliance with extremists today.  The USA doesn't have the leadership to handle its own self made difficulties.  Being irrelevant to the trajectory of events and unable to mend alliances. Is a fairly large goof up.  With time an existential one obviously. 


is this just wishful ,," Why don't you,and him fight " ??

by bushtheliberator on

   "" 10 years ago the US should have invaded Iran first, and had Iran's army do the dirty work""

President GW Bush got such advise, and wisely rejected it. Kuwait has that big,sandy parking lot, but creating hostile beach heads can be bloody.Are the LosAnglestas willing to hit the beach first ? Also. ..." Iran's army" doesn't make a convincing proxy, given their past performance against Iraq ! Iranians, may God bless them, are going to have to liberate themselves !

And only Lefties could share you understanding of the "OIL business ! You seem to think Pres. Bush was going to "deny" OIL to others by rolling into Iraq like Hitler rolling into Romania's fields.The "OIL' Biz don't work like that.!! The removal of the dictator, and the establishment of a VASTLY more open,and transparent society produces ( quite predictably) HYPER PETRO-NATIONALISM ! Iraq is offering its many bidders the skinniest oil deals EVER SEEN.Red China's working for $1.50/barrel .!Let them have it; just bring on more supply.



I like your posts

by Frashogar on

Your analysis here is also spot-on. It is also arguments Ron Paul has been making for a while.


Good analysis

by MRX on

Enjoyed reading your analysis.  U.S decline which started thrity some years a go is surely accelerating now faster than ever. With 17 trillion in debt and no end is sight one wonders how long it can sustain itself before the whole thing starting to collaps. These are  panic and uncertain times and as such not all the decisions being made are with logic and thought. it's highly possible the decision they have made about Iran and if not entire region has been one giant mistake after another...............