Paul Craig Roberts
Voice of Russia interviews Paul Craig Roberts
July 1, 2014
June 27, 2014 interview
How true is the spreading belief that President Obama has ruined US foreign policy, and how does it actually work? The Voice of Russia is discussing it with Paul Craig Roberts, former assistant secretary of the US Treasury, currently the chairman of The Institute for Political Economy.
VOR: The US media is pointing to a growing dissatisfaction with President Obama’s foreign policy, both among Republicans and Democrats. Speaking at the Faith and Freedom Coalition’s conference in Washington Sen. Ted Cruz said “Abroad, we see our foreign policy collapsing and every region in the world is getting more and more dangerous”. According to the latest New York Times/CBS News poll has registered an increasing lack of faith in the president and his leadership, with 58 per cent of Americans disapproving of the way Obama is handling foreign policy. What is it that makes Americans unhappy?
Paul Craig Roberts: Well, I think, perhaps, Americans are catching on to all of the lies. There are now other sources of information, other than the English-speaking Western media. And the account that the US gives, for example, of Ukraine is clearly a lie. And it takes a while before people catch on to the lies. I don’t think the majority will ever catch on, but enough will.
And then many Americans who are dissatisfied would be dissatisfied for domestic economic reasons. They would want the resources wasted on wars to be allocated to domestic needs and not used to pay for more wars. For example, the Iraq crisis has come back and there is so much talk about sending troops to the Baltics, eastern Europe in order to guard against the “Russian threat.”
So, this alarms people who’ve had no income growth, who can’t find a job, suffer from heavy debts from borrowed money to attend the universities, cut backs of unemployment compensation, the threats to the social security system, the threats to the public medical system (which is not much of a system, but still some people rely on it). So, most Americans, when they see more trouble abroad involving more wars, understand that the wars mean more economic hardship for them. The US has been in war for 13 years. It’s wasted trillions of dollars and achieved no result. And so, this is probably the main reason that people are dissatisfied, because they are suffering here for the sake of wars in which they no longer believe.
VOR: But what exactly is the rationale behind the never-ending wars?
There are several reasons that are mutually supportive. One is that the neoconservative ideology came to full power with the collapse of the Soviet Union. And this ideology says that history has chosen the US to prevail all over the world, that there is no alternative to the American political and economic system, and that this choice by history gives the US the responsibility to exercise hegemony over the entire world.
So, this is a very powerful ideology, a more powerful ideology than the US has ever before had. And it comes at a time when other ideologies are gone. The communist ideology is gone, the Marxist revolutionary movements are gone. And so, it leaves the US dominating on the ideological level.
Another reason is the military-security complex. It is an amazingly large and powerful private interest group with government elements, such as all the security agencies – the CIA, Homeland Security, FBI, the Pentagon. And it absorbs hundreds of billions of dollars, probably close to one trillion dollars annually.
And this money is very important to this interest group. Some of the taxpayers’ money is recycled, it comes back to Congress, it comes back to presidential candidates, as political campaign contributions, thus ensuring their elections and reelections. So, this is a second very strong force – a material interest that is very much benefited by wars and a threat of wars.
And the third very powerful interest group is the Israel lobby. Most of the neoconservatives are Jewish ethnics. Many of them are Israeli-US citizens. Almost all of them are closely tied to Israel. And so, the neoconservative ideology of American hegemony fits in very well with the 13 years of wars in the ME, because these wars also serve a subsidiary interest of disposing of the Arab states that are not aligned with the US and Israel, and that could serve as a check on Israeli policy or Israeli expansion in the ME.
So, these three come together, they are all mutually supportive and in many ways it is the same people. The neoconservatives are the same as the Israel lobby. The officials in the Pentagon, in the State Department, they are also neoconservatives. So, it is a very strong three-part foundation that holds together.
VOR: So, you are saying that the policy is largely defined by an Israeli lobby. But the US policies in the ME actually endanger Israel.
Yes, this is an unintended consequence of the policy. Some analysts tried to warn the neoconservatives that the borders in the ME are artificial, like the ones in Africa that were drawn up by the European colonists, principally the English and the French.
So, you have countries in which you have Shia majorities and Sunni minorities, and then you have countries in which there is a reverse, Sunni majorities and Shia minorities. And this is like the African boundaries that were drawn bringing into the same country two warring tribes, who traditionally were enemies. So, the boundaries of the states don’t make a lot of sense. The boundaries could only have been drawn by ignorant Westerners.
The Islamic confrontation between the different sects was prevented by very strong secular rulers, such as Saddam Hussein, who had a secular government, and Assad in Syria. These were secular, non-Islamic governments that kept the conflict suppressed. So, when you overthrow those governments , you release the conflict.
So, what we see happening on the part of what they are calling ISIS or ISIL is a reforming of borders. Parts of Syria and Iraq are becoming, if the Islamists succeed, a new state. Now, we don’t know whether they will be successful or not, but you can see that there is an impetus to create a life separate from the artificial one created for them by colonial imperialistic powers.
One of the reasons that the breakup of Iraq and Syria was not seen as a threat to Israel, was the Israeli and the neoconservative strategists, who reasoned – oh, this is good, if we break up these states and they are fighting internally, there won’t be any organized government to get in Israel’s way.
In place of Iraq, there will be these warring factions. In place of Syria – warring factions, just like in Libya today. And a state that has no central government is no threat to Israel. And, therefore, we favor this destruction of the political entities of these countries, because it releases us from any sort of organized government’s opposition to Israel’s theft of Palestine. Iraq no longer has a government, it has warring parties, like in Libya, like Washington is establishing in Syria.
So, this is the way the Israelis and the neoconservatives see it. They do not see the destruction of secular Muslim states as a threat, the fools see it as a destruction of a unified country, which would reduce the ability of that country to employ any sort of opposition to Israeli or American purposes.
VOR: But in that case, wouldn’t the government and governmental institutions be replaced by something like political and paramilitary organizations, which we now term as extremist groups with which we are dealing now? And wouldn’t those entities pose more threat, than individual governments? Or do those people believe that they would be able to control them somehow?
No, I don’t think they think they can control them. And yes, they do pose a threat, because they are not secular. That’s what I said. Some of us warned that this would be the outcome. But we were ignored and primarily ignored because the Israelis and the neoconservatives regarded the breakup of these countries as less threatening.
VOR: When you have been describing that neocon ideology with an idea of a global mission, doesn’t it seem strikingly similar to something like the Marxist ideology, to the communist ideology?
Yes, that’s exactly what it is. The US is chosen by history. In Marxism history chooses the proletariat. In the neoconservative ideology history chose Washington.
VOR: Does that imply that, perhaps, those two ideologies could have a common root?
No, I don’t think they have a common root, but their effect on the world is the same, because it gives the country that expresses that ideology an impetus to run over other countries and to establish itself, because it sees itself as the sole legitimate system. And in that sense, the Marxist and the neoconservative ideologies are the same, but the roots are quite different.
And I think as well, you know, the whole notion of the unipolar world, the American sole superpower, this fits the financial interests very well. I left them out of my three-part foundation that I spoke to you about, but in a way it is a four-part, because of the American financial hegemony that now exists. This financial hegemony is the reason Washington can put sanctions on countries.
If your currency is not the world currency and you don’t operate the world payment system, you can’t impose sanctions. And so, the power to impose sanctions is also a power for your financial institutions to prevail over the institutions of other countries. So, this ideology that I’m talking about also appeals to Wall Street, to the big banks, because it ensures their hegemony as well.
VOR: But in that case, I start wondering – was it an intended implication or, perhaps, unintended, again, that whatever the US has been doing for the past ten years or even more has been strengthening China, which the US seems to be identifying as its primary adversary. Now, you’ve been mentioning the financial system. The Chinese start talking about bringing their own currency into the world market as a new reserve currency. And this has been largely thanks to all those crises, which have been triggered off by the US.
What the US did that gave China its economic beginning, was to offshore the American manufacturing jobs. Industry and American manufacturing was moved offshore by the capitalists under the pressure of Wall Street in order to lower labor costs, in order to achieve higher earnings for shareholders, for Wall Street and for the managers through bonuses. And so, it was a very shortsighted policy from the standpoint of national interests, but it was in the interest of Wall Street and in the individual interests of the chief executive officers of the corporations.
Once China had the American technology and the American business knowhow, it was free of American economic predominance. And now, actually, China has a much more powerful economy, certainly in manufacturing, than the US has.
Another factor that contributed to weakening the American economic system was the rise of the high-speed Internet, because now it is possible for professional service jobs, such as engineering, software engineering, computers, any type of engineering, any type of work that does not have to be done on site, this work can be done anywhere in the world and sent in on the high-speed Internet.
This has given countries like India and China the ability to put their people into jobs that used to be filled by American university graduates. Again, it is a cost saving for the corporations, Wall Street likes it, it increases profits.
And so, this is where China’s rise came from. It was an unintended consequence of globalism. Again, some of us warned, I warned, I’ve been warning for ten or fifteen years, but they don’t listen. They say – oh, it is just free trade, we will benefit. Clearly, they were wrong, it is not free trade and we haven’t benefited.
VOR: But in that sense, does that imply that, perhaps, when we are talking about the interests of large corporations VS national interests, national interests are increasingly losing to the corporate?
In the real sense, there is no longer an American national interest. There is the interest of these powerful interest groups. And we’ve had these recent studies from scholars who have found that the American public has no input whatsoever into government decisions or into policy decisions. The conclusion of the recent study, which looked at thousands of government decisions, was that the American people have zero input into the formation of policy.
So, in terms of anything being done for the benefit of the people or the national interests in that sense, nothing is done. What is done is for the benefit of about 6 powerful interest groups. And I’ve told you about the four, which I think are the most powerful in terms of the foreign policy – the question that you raised.
So, in that sense, the US is sort of making itself vulnerable in many ways. For example, look at the economic policy. For years now, in order to support a handful of large banks the Federal Reserve is creating trillions of dollars, new dollars.
This creation of dollars devalues the existing dollars that are held by people around the world. They look and say – what are my dollar assets going to be worth, when the Federal Reserve is creating so many new dollars every year?
So, this has caused some thought about leaving the dollar as the world reserve system. When the threat to the real value of dollar denominated financial instruments comes on top of the suffering from Washington’s financial bullying of sovereign countries, the momentum grows for finding some other mechanism than the dollar as a way of settling international transactions.
And of course, the Chinese have said that it is time to de-americanize the world. And the Russians said recently that we need to de-dollarize the payment system. And so, we have this agreement with Russia and China on the large energy deal which is going to be outside the dollar payment system.
We see the BRICS, the five countries – India, China, Russia, Brazil and South Africa – and they are talking about settling their trade imbalances in their own currencies. And they are even talking about creating a bank between themselves, like an IMF or a World Bank.
So, those are the developments that come from America’s misuse of the dollar as world reserve currency. Washington uses the dollar to bully, they use it to sanction, they use it give their financial institutions hegemony over others. And over time, all of this creates animosity, worries. And then, when you add, on top of that, all the new dollars that the Federal Reserve has created since 2008, it creates a real financial worry. And so, I think, in that sense, the US has weakened its position.
VOR: But how far do you think the US might be prepared to go to protect the dollar? Or, perhaps, those interest groups are no longer interested to protect that particular currency. Perhaps, they have already taken some kind of precautions.
From the standpoint of Washington’s power, losing the world currency role would be devastating, because that’s the main basis for Washington’s power. That’s why Washington has financial hegemony, that’s why iWashington can impose sanctions on sovereign countries. So, if Washington loses this role, if the dollar ceases to be the world reserve currency, we’ll see a dramatic reduction in Washington’s power.
All of the interest groups that benefit from Washington’s power would find that a disadvantage. Of course, most of these corporations are now global or transnational. And they may have bank balances in many countries.
VOR: But still, how far is Washington prepared to go? Could it afford another war? When Saddam Hussein attempted to challenge the US Dollar back in 2000, he had to pay a price. And we all know what kind of price he did pay. Now, when China and Russia, and other countries are starting to mull the idea, what kind of risk are they running?
They are running a risk. We already know that the US has announced a pivot to Asia, reallocating 60% of the American navy to the South China Sea to control the flow of resources on which China depends. The US is contracting to build a series of new air and naval bases running from the Philippines to Vietnam in order to block China.
We have witnessed this century the US withdraw from the ABM treaty with Russia. We witnessed the US construct an ABM system and began deploying it on Russia’s borders. The purpose of an ABM is to neutralize the strategic deterrent of the other country.
We’ve seen the US change its war doctrine, nuclear weapons are no longer to be used only in retaliation to an attack. They are now a preemptive first-strike force. This is clearly directed at Russia. The Ukraine is directed at Russia. So, the war is already started, it is underway. That’s what the Ukraine is about. It is the war against Russia.
And the war against China is in preparation. The US takes the side of every country that gets into a dispute with China, even over small things that have nothing whatsoever to do with the US.
The US is surrounding both countries with military bases. The US wants to put Georgia, the birthplace of Joseph Stalin that was part of Russia for two or three hundred years, they want to put that into NATO. They are going to put Ukraine into NATO.
Washington broke all the agreements that Reagan and Gorbachev had about not taking NATO into eastern Europe. NATO is now in the Baltics. It is all across eastern Europe. The former members of the Warsaw pact are now members of NATO.
So, the war is already underway, it is clear. The US has been preparing for years. And the Russians, they must be aware of this. If they are not, they are in really deep trouble.
VOR: Can the US afford it?
Of course! Sure! The reserve currency can pay its bills by printing money. And that’s what Washington does. Washington prints the money.
VOR: But like you said, that creates a lot of risks.
Until the reserve currency role is lost, there is no limit. Recently I read that one of the advisors to Putin said that Russia needs to form some kind of alliance with other countries and bring down the dollar as the world reserve currency, that this is the only way to stop Washington’s military aggression. Of course, he is completely right. But the question is – can they organize something that quick enough that succeeds – because Europe is an American puppet state. Those European governments are not independent. They are no more independent than Hungary and Czechoslovakia and Poland were of the Soviet Communist Party. And Japan is a puppet state, it is not an independent country.
So, if you have the euro backing the dollar and you have the yen backing the dollar, that’s a fairly strong position to be in. And so, it is going to be difficult for Russia and China or whoever is interested to make inroads in any sort of a rapid way.
And yet, we can see… look what happened in Ukraine. Russia was focused on the Olympics and the US stole Ukraine. Russia was paying no attention, somehow the Sochi Olympics were more important. So, what happened – Washington reached in, stole Ukraine. Now, this is a tremendous problem for the Russian Government, for Putin, for his leadership.
Putin has asked the Russia Duma to rescind the permission to use the Russian troops in Ukraine. So, clearly, he is acting in a very restrained way. He is trying to avoid conflict. He probably realizes that the conflict will be much more dangerous to everybody than the neoconservatives in Washington think.
But the question is – will Putin be able to avoid conflict? What will Washington think? Will they think – oh, this is a very reasonable man, we can make a deal. Or will they think – look, he is scared, Russia is weak, lets’ push forward.
VOR: It is interesting! I remember that George W. Bush in an interview to the Wall Street Journal towards the end of his second term said something about Putin, which was rather surprising to hear from him. He said that Putin never failed him on any of his promises. So, the assessment was rather positive than negative.
I think that’s true. But you see, Washington’s propaganda has nothing to do with facts. There is no propaganda like Washington propaganda. Washington can control the explanation of anything. Putin can’t. Americans believe that all the trouble in Ukraine was caused by Putin, that he invaded, that he annexed, that he is behind all the trouble in southeastern Ukraine today and that it is all Russia’s fault, and that Russia is a threat, and that we have to arm ourselves against “the Russian threat.” Washington is recreating the Cold War that it had with the Soviet Union.
This is a very profitable way to supply the US military-security complex with the taxpayers’ money. And in some ways it is safer than a war, because the war in Afghanistan didn’t go well, the war in Iraq didn’t go well. But if you can have a Cold War and you don’t actually fight, you can keep it going for years, just like the Cold War with the Soviet Union. And the Cold War built the military-security complex in the US.
So, that’s at least the backup line for Washington. I’m not sure that we can rely on Washington to have the judgment not to push Washington’s takeover of Ukraine into a hot war. It seems preposterous to think that Washington would be in a hot war with China and Russia. These are two large powerful countries. They have nuclear weapons.
But a lot of preposterous things have happened. And governments often fall under the sway of their own propaganda. And clearly, somebody in Washington thinks that a nuclear war can be won, because otherwise, why would they change the war doctrine so that nuclear weapons cease to be a retaliatory force and become a first-strike weapon? Why would they build antiballistic missiles and put them on Russia’s border and on ships in the Black Sea and South China Sea.
It is clear that some people in Washington believe that the US can win a nuclear war. In fact, there was an article published several years ago in Foreign Affairs, which is the principle journal of the Council on Foreign Relations – an influential collection of strategic analysts and former government officials. And they said the US is so far ahead of Russia in nuclear weaponry, that we can very easily attack Russia and suffer no retaliation. So, you have people that think that way.
VOR: But that experiment could cost us a planet.
That’s exactly it! But look at WW I. Look how many empires it cost. It cost the Tsar — Russia and its empire. It cost the Austrian-Hungarians, it destroyed them. It destroyed the German ruling family. The war left Great Britain dependent on US financial support.
VOR: Yes, true. But there were no nuclear weapons at that time.
There is big propaganda that you can actually use nuclear weapons. I’m trying to combat that. I had recently on my site articles by various scientists pointing out that nobody wins.
VOR: I’m absolutely amazed at how the Department of State is handling its own propaganda, there is no real argumentation whatsoever. Why? Is it that they no longer care to look credible?
It is just the power. American foreign policy, how does it work? It is always based on coercion or threats, bribes. If a bribe doesn’t work, you use a threat. I mean, one of the main purposes of the NSA spying on the world is to be able to blackmail all the government leaders. And they do that very effectively. Everybody has got something they don’t want known. So, they use bribes, bags full of money. First of all, Washington buys the foreign leaders. If there is any holdout, they topple them, like Saddam Hussein, Gaddafi. There have been several in South America that they’ve simply just assassinated, because they wouldn’t obey. So, the foreign policy of the US is a policy based on force. It is not based on diplomacy or persuasion. It is based on brutal force.
What does the State Department tell people – do what we say or we will bomb you into the Stone Age. Remember? They told that to the Pakistani leader. Do what we say. Now!
So, if you have that type of attitude, it doesn’t matter whether you tell the truth or tell lies, because you are the ruler, you are the one, you are the Caesar. And what you say goes, true or false. And so, it is not important to you that it is true, because you are not working on a diplomatic level.
This is something that Putin and Lavrov – the Foreign Minister – don’t seem to understand. They keep thinking that they can work something out with Washington, if the Russian government is just reasonable enough and shows enough good will.
This is a Russian delusion. Washington has no good will.
VOR: Are there any unintended consequences to that strategy, the way you see it?
Only if people catch on and see at some point the reality–and this is what Putin is relying on. At some point, what happens in Germany and France? Will they realize and say – hey, look, the Americans are driving us into a mess. What do we gain from the American hegemony over the world? How do we gain from a conflict with Russia or China? Let’s stop this. Let’s pull out.
If some country were to pull out of NATO or pull out of the EU, then the cover up of Washington’s war crimes by “the coalition of the willing” would have dissenters. Washington has actually told the Congress that if the White House has NATO’s backing, the president doesn’t need the permission of Congress to go to war. The old quote – ‘absolute power corrupts absolutely’ is attributed to Lord Acton. It is safe to conclude that Washington has been corrupted by power.
I think one unintended consequence of Washington’s brutal use of power is that it causes the NATO countries to realize that they are being driven towards a conflict by a government that is essentially insane and taking a fantastic risk with everyone’s life and with the planet.
So, perhaps, the realization by others of Washington’s danger to life is what Putin is hoping for. He is hoping that the more Russia is reasonable and not provocative, and doesn’t take provocative actions, the greater the chance that the German Government or the French Government will realize that Washington’s agenda does not serve mankind, and that Europe will take some steps to extract themselves and their countries, and their people from Washington’s control, in which case the American empire falls apart.
So, I think that’s what Putin is betting on. He is not a fool, certainly not, and he realizes the threat of a war, he can see it. And so, this is probably why he’s asked the Russian Duma to rescind the permission to use the Russian forces in Ukraine. He is trying to show the Germans, the French – look, it is not me, it is not us.
I hope he succeeds. The future of the world really depends on whether Putin’s use of diplomacy can prevail over Washington’s use of force.
About Paul Craig Roberts
Paul Craig Roberts was Assistant Secretary of the Treasury for Economic Policy and associate editor of the Wall Street Journal. He was columnist for Business Week, Scripps Howard News Service, and Creators Syndicate. He has had many university appointments and his Internet columns have attracted a worldwide following. Roberts' latest books are The Failure of Laissez Faire Capitalism and Economic Dissolution of the West and How America Was Lost.
Paul Craig Roberts website