Thursday, May 21, 2009

The Precipice and The Abyss

As the nation presses inexorably forward to an ineluctable catharsis, another milestone has been quietly reached without fanfare, void of acknowledgement, seemingly of little importance and even less concern. The event we speak of is an economic milestone which presages an imminent collapse of the U.S. dollar as the major international reserve currency. As the deficit balloons to an almost unimaginable $1.75 trillion, the dollar slide has become irreversible as the UDX dipped to 79. UK debtworthiness has been downgraded and the U.S. is not to be long in following. New international currency cartels are being formed as the economic implosion in the U.S. continues unabated. China, Brazil and Argentina among others have already established trade agreements based on their respective currencies as international markets move away from dollar valuation. All that remains in the U.S. equity markets is a "sucker bubble" due to the massive infusion of the more than $12 trillions in electronically generated paper life support . Meanwhile the gold bell-wether is sounding the alarm as the royal metal has knifed through resistance levels to test the $960 level. We have come to this precipice almost unconsciously without understanding where we are being led or indeed where we are coming from. An unprecedented crisis of national identity is transpiring, a crisis which has begun assuming the character of a struggle for survival itself, personal, societal, and national. The economic cataclysm which has engulfed the world in such a relatively short time is now on the verge of transmorgrifying into a military conflict of unimaginable dimensions which is breaking upon our largely unsuspecting world with wave upon wave of gathering tidal fury which will inexorably inundate and obliterate that world as we know it. When we look at the theater of the present conflict as it spreads across Central Asia and into the Indian Subcontinent we can discern the outlines of the conflagration which has already been joined by the opposing hemispheric alliances deployed one against the other and reflecting the economic collapse of the prevailing economic paradigm. What one is reminded of here is Clauswitz's famous dictum, "War is the continuation of policy by other means." The irremediably grievous and catastrophic conflicts in both Pakistan and Sri Lanka, and the ongoing decades long evisceration of Iraq are the unfortunate staging areas of the larger geopolitical battleground upon which renascent China and the remnants of Anglo-American empire will engage.

The recent conflict in Sri Lanka underscored the Chinese geopolitical initiatives taking place throughout Southeast Asia and the Indian Subcontinent. The 26 year old civil war in Sri Lanka, to all appearances an intractable and bloody struggle characterised by brutal suicide attacks on civilian as well as military targets, has finally come to an abrupt and sanguinary end with the decimation of the Liberation Tigers of Tamil Eelam and a decisive government victory. The denouément partook of the mass displacement and wholesale slaughter of hundreds of thousands of indigenous natives in a bloodbath unparalelled even by the standards of the particularily indiscriminate targeting of civilians which has characterised the decades long conflagration. Scarcely mentioned in the midst of the surprising turn around which brought about the government victory is the fact that Sri Lanka has become a client state of China which has bankrolled not only the construction of the Hambanata naval base to the tune of more than $1 billion, but has also supplied the Sinhalese government with military hardware and armaments totalling $38 million in April of 2007. In July 2001, after a devastating suicide attack on the Bandaranaike International Airport by the Tamil Tigers, which resulted in the catastrophic loss of 8 air force planes as well 4 Sri Lankan Airlines Airbuses, the Chinese stepped in and resupplied the government losses with six F7 jet fighters. It is obviously the unlimited Chinese support and intervention which has turned the tide as India, which unsuccessfully deployed its forces in the island nation in 1987 through 1991, a venture which brought about the assassination by the Tamil Tigers of ex-prime minister Rajiv Gandhi in 1991, stands idly by. Meanwhile in Pakistan a similar government offensive, which has left more than a million residents of the country's northeastern provinces displaced refugees, seeks to dislodge Pashtun militants from the Swat Valley and Buner. This is but the latest catastrophe to beset a nation which appears on the brink of outright disintegration as the abortive U.S. Afghanistan adventure spills across its borders. Receiving much less attention on Pakistan's southwest coast is yet another significant Chinese enterprise, the deep water port and naval station being constructed at Gwadar at the furthest end of the Karakoram highway. Gwadar in the restive province of Baluchistan is destined to become an energy transport hub and oil pipeline into Chinese ruled Xinjiang designed to insulate Peking from interdiction of its oil supplies by hostile naval forces in the event of a major war. Additional Chinese port construction projects are taking place at Chittagong in Bangladesh and Sittive in Burma. In addition Chinese naval forces recently deployed 3 vessels to the Gulf of Aden in November and December 2008 on an unprecedented anti-piracy mission. As the Chinese footprint across South Asia enlarges, and the U.S. economic meltdown reaches critical mass, a collapse of the dollar is all that is needed to bring about a military confrontation, the stage for which is already being set by the various geopolitical manueverings in South and Central Asia and the Indian Subcontinent. "War is a continuation of policy by other means"
Or is it Russia? As we post this some days later, the Russian naval fleet has visited the Syrian port of Tartus where it has established a naval base as it has in Yemen, Vietnam (at the Haiphong Harbor), and Libya among other ports as an alternative to Sevastopol in Ukrainian Crimea. In the Black Sea, the Russian and American naval forces are in a standoff after Russia recognised the breakaway region of Abkhazia as it secedes from the the former Russian republic of Georgia. A U.S. Coast Gaurd cruiser was redirected from the Black Sea port of Tumi already occupied by Russian missle cruisers as the resupply of Georgian forces by NATO is challenged by the Russian fleet. These manueverings are significant in light of the prospects of an expected Israeli strike against Iranian nuclear facilities in mid June. As Obama has publicly disavowed any support of an Israeli attack on Iranian nuclear facilities in a recent meeting with "Bibi" Netanyahu, the expectation is that the attack will go ahead as planned with American air support and AIWACS intelligence assets. The Israelis are committed to a pre-emptive strike similar to those which destroyed the Iraqi nuclear reactor prior to the Iraq- Iran war (1980-88) and a Syrian nuclear project in 2006. The Iranian nuclear facilities are protected by Rapier SAM and S-300 missile defense systems provided by the Russians and the deployment of Russian naval forces in the Mediterranean and Black Sea reinforce the growing and perilous confrontation brewing in the already inflamed Middle East.

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