At the Alfred Deakin Innovation Lectures 2005: Lecture Five, Shared Destinies: America, Asia and Australia on Sunday 5 June 2005 Singaporean diplomat Kishore Mahbubani posed some provocative challenges for Western and Eastern societies alike.

As our world is smaller and more linked than ever before, economic prosperity, political stability and environmental survival are all deeply enmeshed.

One of his themes was that perhaps our greatest challenge lies in coming to terms with some profound cultural differences; differences that still separate Western and Eastern cultures. Acclaimed author of "Can Asians Think?" Kishore Mahbuban was not holding back in being pro-American... which was not a problem for me since I am not anti-American as some people would believe. Hey, there are at least half of the population in the US that do not believe the crap dished out by the Bush administration...

But in his lecture (transcript not available yet) Kishore Mahbuban made a reference that the US could not have gone to war against in Iraq for the oil because the sums did not add up—the expenditure of war versus the return in oil were such disparate that it clearly showed that they did not do so for the oil...

Oh boy Gus begs to differ strongly here....

Kishore Mahbuban was challenged on a few of his views but strangely not on this one although I was unable to listen to the exchanges right to the end.

I can say the good Kishore Mahbuban has not done the complete maths....

The world consumes a minimum 80 million barrels of oil per day... of which Iraq produces 2 million per day... In money terms this amounts to say 100 million US dollar per day (50 dollar/barrel) and that over a year Iraq oil revenue would only be about 36 billion per annum... The expenditure for war is already running at 250 BILLION dollars and demanding the US spends about one billion a month roughly.... So it appears that even if the US were to pocket all the cash from Iraqi oil sale the gain is a loss, but not so minuscule, in relation to the expenditure...

But one cannot stop here. There are many other factors that enter this complex equation.

Item 1
The retail sales from petroleum products per day is a MINIMUM of 12 billions dollars per day... so between the cash price for a barrel of oil and the end user where things go up in smoke, there is a 12,000/400 economic increment that can not be sneezed at. That represent a value-plus of 30 to one or 3,000 per cent increase on the economic value of the oil... The oil in Iraq represents 2 per cent of this world value but at an end product still 30 times the original value of the average barrel... In short the value to the US is about 600 million per day, thus about 216 billion per year.. So the differential between the war cost and the return at the end product is far from being so negative... At that rate one needs only 3 to 4 years to recoup the original and ongoing investment...

Item 2
The second factor that enters this equation is that the cost of the war, although some things go up in smoke at some point, goes a long way in making the wheel of a static economy turning... American Arms manufacturers are making huge turnovers and decent profits out of this war which is mostly funded by the US deficit... This it is a salient form of subsidy without appearing as one in the books... So there is a minimum extra 250 billion of US money conservatively sloshing about in the economy... The money is thus not "lost" or "wasted"...

Item 3
The war effort demands a streamlining of ideas and hardware to become more efficient.. thus the enormous investment in research and development of a country being funded by the government rather than private enterprise but investment moneys given to private enterprise under "war contracts" including food for soldiers, BP vests and a plethora of new developments, including those from The Defense Advanced Research Projects Agency DARPA.

Item 4
The oil in Iraq was under the control of the Europeans and the Russians and the oil was traded in Euros. This represented a small wedge in a possible dent in the US controlling the price of oil. Whether OPEC says this or that, the price is calculated in US DOLLARS... That some other Arabic countries were starting to make noises about trading their own oil in Euros in order to be able to deal direct without having the US dollar being involved — thus removing a small exchange-rate discounting that sucked a bit of value out of the deals and filled US coffers — was attractive to Europe and the oil producing nations, but total heresy to the US who wants and needs to control the oil supply of the world no matter what, at whatever cost...

Item 5
That the economic dependency of a country on another amounts to an imbalance of trade, an imbalance of political control and of an uncertainty of existence although it is not called "Colonialism" anymore, it is a different form of theft of resources and plunder... including slow, or fast, cultural annihilation... Including the theft of national treasures... by "private" collectors...

No value from oil in invading Iraq? Sure, on planet Furph in the Porkie Galaxy...