An Exchange of Views: 2. The Moral Issue
SEABURY, PAUL
The Moral Issue BY PAUL SEAHURY Touma Arida's reply to my article seems chiefly designed to assert the notion that OPEC price policies are no more damaging to, or blameworthy for, current...
...economy," he declares, "has itself reaped sizeable benefits," since other Western nations have found themselves undercut in world markets by more competitive U.S...
...Then he observes that oil-exporting countries-Algeria, Iraq and Egypt-suffer from capital shortages...
...But what a straw...
...It has been calculated that West Europe, Canada, Japan, and the United States will suffer a deficit ranging from $25-$40 billion in 1974 alone, as a result of tribute...
...The world price of oil, in December 1970, was $1.80 per barrel...
...Conservative estimates now project 1975 oil earnings for the Gulf states (minus Iraq) and Libya in the neighborhood of $50 billion...
...Egypt, the Arab world's most populous land, produces a tiny amount-equivalent to only 2.5 per cent of Saudi Arabia's output...
...In August 1973, it suddenly jumped to $3.07...
...There are no means available, other than suasion or force, for the popular will to reach into distant sovereign states...
...Even this proposition, though, cannot fly...
...That technological innovation reduces the immediate presence of labor in no way affects the central issue: It takes very little production to obtain petroleum...
...to manufacture is, ultimately, to make something by hand and effort of hand...
...Thus, as economist Walter Levy notes, "nearly unmanageable problems are posed for all the oil-importing countries...
...But if we were to say that the price-hike profits to the companies and to the OPEC nations constitute 100 per cent, then OPEC has taken 95 per cent and the companies only 5 per cent...
...Perhaps most stimulating, though, is Arida's concluding rhetorical question...
...But when I wrote "Thinking About an Oil War" (which has gained me a small reputation as a premature anti-0PECer), I had no intention of making "blithe" and adventurist proposals...
...Arida languidly suggests that the oil price hike is merely one of many Stations-of-the-Cross marking the consumer countries' procession to Golgotha...
...trade balances commences in October 1973-the precise date of the price hijack...
...There is, in addition, a deep moral issue that Arida's loaded question inspires...
...Precisely because of the astronomical increases in energy costs, these producing countries are less able to do this than they were a year-and-a-half ago...
...Its impact, both primary and secondary, is being felt everywhere-beginning with the monetary world-in ways Arida does not take pains to describe...
...But the cost to America has also catapulted, from $8.5 billion in 1973 to approximately $25 billion in 1974...
...Since then, the whole globe has shared, with peaceable acquiescence, the agony of adjusting to the decision of a tiny group of men, made for the enrichment of their families or their small nations...
...it is a nation of live persons...
...This is not the whole story, for the OPEC action has inspired severe price rises in other (higher-cost) fuel and energy sources...
...The muted cries inspired by these heavy injuries have mainly come, so far, from persons in countries relatively less grievously afflicted, where there is a certain freedom of expression not present in poorer and far more vulnerable lands...
...To produce is to manufacture...
...The Moral Issue BY PAUL SEAHURY Touma Arida's reply to my article seems chiefly designed to assert the notion that OPEC price policies are no more damaging to, or blameworthy for, current international energy and monetary problems than the practices of other nations, now or in the past...
...Already the damage has been very heavy...
...Going a bit further, what would America's reputation be today if the world's available petroleum reserves were chiefly located in the United States, and Washington had abruptly decided to quintuple the price of oil, and/or to cease all oil exports for political purposes...
...Their recent pleas to the Arab oil exporters for special treatment have been coldly ignored...
...For September 1973, U.S...
...only Saudi Arabia, Kuwait, the Gulf states, and Libya enjoy the much-vaunted excesses...
...I emphasize this moral point with deliberate intensity...
...even less do I wish to tax the attention of reasonably informed readers...
...These desolate and largely uninhabited nations, however, are the major exporters...
...First, to the matter of magnitude...
...In at least 40 countries of Africa, Asia and Latin America, catastrophic prospects-including the collapse of the agricultural sector-loom large...
...Lebanon produces none...
...In any case America is not a disembodied aggregation of businesses, as some simplistic neo-Marxists avow...
...We might also wonder how Arida concludes that (mirabile dictu...
...The Indian subcontinent, including Bangladesh, which suffers the oil crisis silently and subserviently but is predictably loud and strident when it complains to the West, likewise deserves sympathetic mention...
...Or, to switch Holy Land metaphors, it is to him only one more straw on an overburdened camel's back...
...If the West faces unemployment and general deprivation, the Third World faces widespread death...
...these have ben widely reported...
...and other nations resulting from a man-made situation imposed upon us...
...While lamenting the pitiable difficulty the Gulf states and Libya are having in digesting their immense revenues (a difficulty that, for some reason, he blames upon the West), Arida might have noted what informed observers suggest as a likely possibility: Should the torrent of money become wholly unmanageable, even for Arab graduates of the Harvard Business School, they always have the option of drastically cutting production back-an option whose consequences the prospective victims would do well to carefully contemplate...
...And in October of that year, it surged to $11.65...
...Yet the effect of the price rise on less-developed and authoritarian societies-nations Arida neglects to mention-has been devastating...
...But the hundreds of millions of persons in developed countries-whose jobs, incomes and good temperaments depend upon guaranteed access to energy-will not long accept a policy that daily, monthly and yearly drains and saps them...
...As for Arida's ex cathedra contention that the United States connived with Saudi Arabia after the October War to prolong the Arab strangulation of the Netherlands and its international refineries for gain, it deserves no reply...
...Yet, as I also said, "it is precisely such circumstances that prudent policy has to prevent, by appearing credibly committed to protecting vital interests.' And, to repeat myself a bit more, "it is important in all political affairs carefully to distinguish what one would wish to do from what circumstances might compel...
...Nor is this all Arida fails to discuss...
...What would America's reputation in the world be, had it embargoed its food exports for political purposes...
...Hardly anyone anymore contests the proposition that the present transfer of wealth from the industrial nations to the OPEC lands, most of them unproductive members of the international community, is one of the largest in human history...
...Oil is simply pumped from the ground, and that is accomplished by Western technology...
...The chief burden of this gigantic increase has been borne by Western Europe...
...I hesitate to consume newsprint repeating them...
...He wonders why "the countries that export [steel, cement and food] do not feel as obliged to increase their output for the international good as they believe the oil producers should be...
...by August 1974 it resulted in a $1.2 billion deficit...
...The whole surplus notion," he says, "must be treated with caution...
...Finally, with regard to the question of force, I must confess to being a poor armchair strategist...
...Other nations have vital interests...
...As I said then, "no one would eagerly choose a course of action entailing the use of force, except in the most desperate circumstances...
...For it lays open a grave matter that to date has not been candidly discussed because the advanced nations have been courteous...
...Citizens have many means available for regulating the domestic oil companies' take in this enormous depredation...
...Those now garnering enormous riches from this activity in fact neither sow nor reap...
...I do not wish to contest his figures on the industry's profits for the first half of 1974...
...But this appears credible only because it omits governing facts that are quickly becoming common knowledge...
...At some point the risks entailed in passively continuing to accept this damage may greatly outweigh the risks entailed in intervention...
...Moreover, several supplementary questions might be raised: What would have happened if the United States (which now accounts for far more than 50 per cent of the world's grain exports) had chosen to "enrich itself by suddenly quintupling the price of grain on the world market in collusion with the other suppliers, Canada and Australia...
...The force of Arida's strange assertion about America's "sizeable benefits" depends primarily upon his seeing the United States as synonomous with the oil companies...
...That equation cannot be honestly made...
...And because of OPEC pricing policies, it is continuing and increasing...
...On the other hand, Iraq and Algeria -the two countries Arida says are best able to absorb immense funds for immediate and profitable domestic purposes-will take in $11.4 billion...
...The U.S...
...Were this so, it would presumably show in balance-of-pay-ments figures...
...Manufacturing entails labor, skill, and intelligence...
...The cost of oil to the principal consuming nations has risen, in the one year after the price hike, from a known $46.2 billion in 1973 to an estimated $120 billion in 1974...
...the United States is profiting from the remarkable oil swindle facilitated, as he tells us, by "the decline of America's global hegemony...
...In particular, one might consider black Africa...
...In 1973 their combined production was 15.5 million barrels per day, compared with a mere 3.1 million barrels from Morocco, Algeria, Tunisia, Egypt and Iraq...
...He equates the American producers of foodstuffs, steel and cement with OPEC "producers" of oil...
...However...
...Paul Seabury is a professor of political science at the Berkeley campus of the University of California...
...Protracted deprivation brought about by a transfer of their earned weath (acquired through labor, skill and intelligence) to those already inordinately rich and becoming more so with each day, who contribute nothing of themselves to what they claim and sell as their own, is not a condition likely to produce either friendship or peace...
...Yet in fact the downward spiral of U.S...
...is Providence so kind to us as to exempt us from having to care about our own basic needs...
...Elsewhere Arida seeks to play down the Arabs' undigestible new wealth because, had he bothered to quantify it, he would have reached conclusions opposite to those he announces...
...The issue of intervention, after all, is one that must be treated as an available option, its merits considered in terms of the damage to the U.S...
...exports...
...trade produced an $800 million surplus...
...There, only two countries have any significant oil fields...
...Seventeen have neither production or refining facilities...
Vol. 58 • February 1975 • No. 4
