The marketplace, like justice, is said to blind, its scales designed to weigh gold rather than contending cases in litigation, let alone rival endeavors to flaunt moral certainties. That’s why it has been with mystification that over the years this space has looked at exceptions to, or confirmations of, that rule. And now, with oil having crossed the $50 per barrel threshold, it is astonishing how much righteousness can be included in so many liters of crude.
The definitional moment for the “moralization” of oil came on September 11, 2001. In the aftermath of the attack, pundits, publicists, show-boaters and demagogues argued that because most of the hijackers on that fateful day were Saudis, it was important to reconsider the relationship between America and Saudi Arabia. Since the relationship floats on an ocean of oil, many a critic naturally argued that that was where the US had to show it was serious.
Among the unserious ideas that burbled to the surface was the effort by one group, named Americans for Fuel Efficient Cars, to launch a crusade against sports utility vehicles (SUV). Their main premise was that since SUVs consume large quantities of gasoline, their owners were effectively pouring money into Saudi coffers, and, so the group claimed, into the terrorist activities the Saudis were allegedly financing. To this was added another moral argument – that SUVs pollute more than normal cars (an untrue contention) – completing the circle of opprobrium linking oil to various true or imagined evils. More serious were those who sought to split the immoral Al-Saud from the vital mineral enriching them. The first publicized effort to resolve this dilemma to America’s satisfaction came from a former Rand Corp. analyst, Lawrence Murawiec, who, in August 2002, gave a lecture at the Pentagon where he proposed that the Saudis either put an end to their shady dealings with militant Islam and end anti-US, anti-Western and anti-Israeli “predications,” or else America should invade the kingdom and its oil fields. A similar line was taken by former CIA agent Robert Baer, who, though more conversant on the Arab world than Murawiec, advised in his book, SLEEPING WITH THE DEVIL, that a Saudi royal impose the “rule of law” in the kingdom by “outlawing righteous murder, jihad, the Muslim Brotherhood. That would be a start; then you could move on to outlawing grotesque commissions, theft, and bribery.” Otherwise, Washington should seize the Saudi oil fields. This would create difficulties, “but would all that be worse than standing idly by as the House of Sa’ud collapsed and the world’s largest known oil reserves fell into the hands of Muslim Brotherhood-inspired fundamentalists…?” That Saudi oil wealth had been used to corrupt members of the American political establishment, specifically the Bush family and their acolytes, was the basis of another recent book, HOUSE OF BUSH, HOUSE OF SAUD, by American journalist Craig Unger. Everywhere, it seems, oil has become a byword for things gone wrong – an indispensable commodity that is also virtually indistinguishable from Middle Eastern vice and terrorism, or, simply, an odiously voracious lifestyle in the West. And at $50 per barrel these arguments are even easier to make, even as most people in the world focus on the economic repercussions of high oil prices.
The thing with introducing morality into the market, however, is that it leads to dead ends. The Saudis may be bad news, but they are the ones to whom everyone has turned to boost oil supply and bring crude prices down. Consumption of gasoline for lifestyle reasons may be wasteful, but how is it different than consumption for economic growth? Is an SUV driver any more reprehensible than a Chinese or Indian factory owner, whose rising demand has been the major factor pushing oil prices up? Are there right and wrong ways to consume oil?
The answer to all the questions is “no.” The only sensible resolution of the oil problem is through amoral market mechanisms. So obvious a statement barely merits being repeated, yet even an experienced pundit like Thomas L. Friedman of The New York Times could not help throwing a pinch of reproach in an October column on how the Bush administration refused to take sensible decisions in Iraq, because of “ideology.” He asked, should the government “impose a ‘Patriot Tax’ of 50 cents a gallon on gasoline to help pay for the war, shrink the deficit and reduce the amount of oil we consumed so we send less money to Saudi Arabia? Never. Just tell the Americans to go on guzzling.”
There you had an impartial proposal and two barbs. Friedman offered a defensible (if misguided) policy prescription like a gasoline surtax, but also a moral mechanism to hammer the Saudis and irk the “gas guzzlers.” No one will remove moral agendas from the marketplace, but they should be cut back drastically. The market is not a church, nor the blackness of oil a nun’s habit.