8.7.2 The Economic Perspective on Invasion
The possible economic impact of invading Iraq was outlined earlier (8.4.3):
● The populations of America and Britain might benefit from increased security of oil supplies and lower oil prices, but these benefits could only come from stability in the Middle East. Stability was more likely to be achieved through a political process and would have come at a much lower cost than a war.
● The war could have been forecast as being more costly than could have been justified by any likely economic benefit to the people of America and Britain.
● The economic opportunities for the American and British oil companies and oilfield services companies, by contrast, would very probably be realised as a result of an invasion and would have been much less certain if Iraq were stabilised by peaceful means. Saddam Hussein had excluded them from Iraq, and they might perceive that their association with the governments which invaded Iraq would be a route to receiving preferential treatment – and that was certainly a popular perception: as shown in a New York Times article, Oil in Iraq, and Andrew E. Kramer’s International Herald Tribune article, Saddam Hussein nationalized oil in Iraq but under American guns Big Oil is back.
● It was planned from the outset that Iraq’s infrastructure would be destroyed: Bush’s speech at Cincinnati on 7 October 2002 included the following promise: “If military action is necessary, the United States and our allies will help the Iraqi people rebuild their economy”. This clearly indicates the planners’ awareness of the possibility of contracts for the reconstruction of Iraq’s infrastructure. American companies, including Halliburton, could anticipate winning contracts for its reconstruction.
Clearly, invasion was a much less risky course of action for a few big companies than it was for the American and British people as a whole. And the likely temporary increase in oil prices, as a consequence of the invasion, would also benefit the oil companies – but would damage the economies of America, Britain and the rest of the world.
(This is a republished page, from the Patterns of Power Edition 2 book. The original archived copy of this page is held at https://www.patternsofpower.org/edition02/872.htm. Its internal links are to Edition 2 legacy material which is unaltered. This section is retained for reference purposes because there are links to it in the book’s index.)