The dramatic fall in the price of Brent crude oil within a few months, (its price has dropped by 25% in the last three months, from about $115 a barrel in June to about $85 today) and, even more important, the decision by Saudi Arabia, the main oil producer, not to cut production levels, so that the oil price could be stabilized at around the average of the last few years (around $100 per barrel), has created the conditions for a new form of economic warfare, beyond the usual sanctions. Although there is no doubt that there are some economic factors at work behind the present drastic decline in the oil price, such factors cannot explain the striking inaction of Saudi Arabia, particularly when it is well known that, unlike most other oil producing countries, it has enough money in its budget to keep oil prices around $80 per barrel for several years to come.[1]
The economic reasons behind the oil price decline refer to both the supply and the demand sides. On the supply side, the US oversupply of oil and energy in general in the last few years, thanks to the 'shale revolution' and other technical advances, is well known. But, even more important is the long-term effect on the oil price because of the suppression of global demand, as a result of the emergence of a new kind of growth economy in the New World Order (NWO) of neoliberal globalization, as I attempted to show elsewhere.[2]
The main mechanism in this new 'growth economy' that brings about the suppression of aggregate demand is the opening and liberalization of markets, in other words, the lifting of any significant social controls on markets imposed in the past to protect society and environment from markets. Today's social controls on markets are of the kind I called in the past regulatory controls,[3] which have usually been introduced by the Transnational Elite (TE) (i.e. the network of economic and political elites mainly based in the G7 countries) in control of the market economy in order to "regulate" the market. The aim of regulatory controls is to create a stable framework for the smooth functioning of the market economy without affecting its essential self-regulating nature. Such controls have always been necessary for the production and reproduction of the system of the market economy but whereas in the past the aim of such regulation was the control of the domestic market economy, today's regulatory controls aim at the transnational market and are imposed through international institutions controlled by the TE, like the World Trade Organization, or the EU bureaucracy as far as the European market is concerned. The effective lifting of social controls aiming at the protection of society from the markets means that transnational corporations are today free to move capital and commodities all over the world having to face basically regulatory controls only. Furthermore, the 'liberalization' of labor markets, which is part of the same process, implies effectively the lifting of social controls to protect labor, for the sake of attracting foreign capital, (i.e. the transnational corporations), and making the economy more 'competitive'. "Flexible' labor is the norm in this process and that implies a vast expansion of part-time or occasional labor, zero-contract hours etc. - all of which have the effect of artificially reducing the level of unemployment at the expense or real incomes which are essentially frozen in real terms.[4]
The fundamental necessary condition for real self-determination, so that the dependence on the NWO of neoliberal globalization and the TE administering it could be eliminated, is self-reliance. The two main reasons for this are:
First, the fact that economic self-reliance is the only way in which a country could become invulnerable to economic sanctions by the TE, which, as shown above, is the main form of economic warfare used by the TE in the globalization era. Second, the fact that self-reliance is the only way in which peoples could determine their country's production patterns in accordance with the consumption patterns they prefer, so that they will not be dependent on foreign (investment and finance) capital to develop their own productive resources and cover their needs.
As regards to the sufficient conditions for real self-determination, the main such condition is economic sovereignty as a precondition of national sovereignty, so that it is a country's people alone that determines the sort of economic policies and social controls required to meet the needs it decides to cover, through the methods of allocation of resources that itself determines, and without any foreign interference on this process. Needless to add that economic self-reliance does not just mean import substitution (i.e. the replacement of foreign products by Russian ones, let alone by Chinese products or BRICS products in general). It means fundamental economic, political and cultural changes, which could only be achieved within a Eurasian Union of sovereign nations, which will have to function as an alternative pole to the present uni-polar world run by the TE. So, self-reliance does not mean isolation, as globalists attempt to defame it. Instead, it means the creation of a new democratic world order of sovereign nations, which will determine collectively and democratically the division of labor between them, on the basis of principles of mutual aid and solidarity to meet their citizens' needs, rather than on the basis of principles of competitiveness drawn from an individualistic culture, like the dominant culture in the present World Order-a topic that transcends the scope of the present article.
Takis Fotopoulos
Takis Fotopoulos is a political philosopher, editor of Society & Nature/Democracy and Nature/The International Journal of Inclusive Democracy. He has also been a columnist for the Athens Daily Eleftherotypia since 1990. Between 1969 and 1989 he was Senior Lecturer in Economics at the University of North London (formerly Polytechnic of North London). He is the author of over 25 books and over 1,000 articles, many of which have been translated into various languages.
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Poster Comment:
The market has been prepared to pay $100/bl for oil so the only reason to bring the price to $80 or less is to put a squeeze on Russia to stop it from supporting Syria, Iran and other anti-Israel regimes. Saudis, being Israeli cousins, go along with this as well as US whose Congress members depends on American Jew duals for success in national elections.