Just to smack around the notably silent Nulan who is generally ROTFL his BAO for no good reason, about 18 months ago he was salivating at the prospect that Iranian oil wealth would deal a body blow to the American economy. He cited the following (already hedged and dated joust) in our discussion of American Military Hegemony.
WASHINGTON – Is the biggest threat Iran poses to the United States really its nuclear ambitions - or is it petropolitics?
Last month the Iranian government quietly reaffirmed plans to create by next year a euro-denominated exchange in oil, natural gas, and other petroleum products. If successful, such an exchange could start to lap at the walls of the two existing oil exchanges - London's International Petroleum Exchange (IPE) and the New York Mercantile Exchange (NYMEX) - both owned by American companies.
If the billions of dollars in oil sales ever got going in euros, experts say, that could dry up the demand for dollars that the heavily indebted US economy depends on, and it could mean big trouble for the US economy. It's enough to make the Great Satan-loathing visionaries behind the Iranian regime salivate. The chances of success, however, seem quite remote - at least in the short term.
Quite remote indeed. But that didn't stop him from flaunting the possibility as a citation of a righteous smack of Bushitler. Well, time hits the hardest blows, especially below the belt. And so here is an update on the economic prospects for Iran. They can't even stabilize their own currency, much less bother ours:
Spengler at the Asia Times asked a year ago: what do you give someone who has everthing -- "cancer, AIDS, Alzheimer's, diabetes, kidney failure, and so forth. Iran's economy is so damaged that it is impossible to tell how bad things are. Except perhaps for the oilfields of southern Iraq, and perhaps also northern Saudi Arabia, there is nothing the West can give Iran to forestall an internal breakdown."
That degree of dysfunction was underscored by a recent Pajamas Media article describing the biggest case of corruption in Iran. Or possibly the Middle East. The chief auditor of the Iranian parliament has reported that $35 B of the country's oil revenues has just gone missing. Not that there's a heck of a lot to be stolen anyway. Despite record oil prices, the regime in Teheran has mismanaged its economy so badly that it is bankrupt. Losing the $35 billion is like a struggling retiree looking in the sugar jar and finding that the next six month's rent money is missing. Spengler writes:
Iranian dissidents put overall unemployment at 30% and youth unemployment at 50%. Government subsidies sustain a very large portion of the population; 42% of the non-agricultural population is employed by the Iranian state, compared with 17% in Pakistan.
Within fewer than 10 years, Iran will become a net importer, at which point the government no longer will be able to provide subsidies. Iran's economic implosion is a source of imminent strategic risk.
Risk to whom? one might ask. More on this later. But the huge corruption scandal in Iran may actually understate the extent of its mismanagement. The Pajamas Media article continues: "This is a serious allegation, as this amount constitutes almost half of Iran’s total oil income for that year. ... To make matters worse, this is not the first time since the start of the presidency of Mahmoud Ahmadinejad that money has been used without the Majlis’ knowledge. One other famous case took place during the 2007-08 financial year. It was revealed later that $2 billion was used to import gasoline, without any consultation or approval of the members of the Iranian parliament."