When Bush Makes Decisions

Colonel (ret.) Larry Wilkerson's worst national security nightmare is the rise of a "dumb tyrant" into the Oval Office. Wilkerson, Colin Powell's former chief of staff, admitted last month that he is living that nightmare. If there was any doubt, yesterday's front page of The New York Times clears it away.

Two headlines scream executive incompetence: "U.S. And Israelis Are Said To Talk Of Hamas Ouster [1]" and, "U.S. Royalty Plan To Give Windfall To Oil Companies [2]."

Here's why. First Hamas. The reported deal to isolate Hamas is based on a woefully ill-informed assessment of the Islamic party. Take a look at Beirut Daily Star Editor-at-Large Rami Khouri's piece in yesterday's TomPaine.com , entitled, "Hamas Will Compromise [3] ." Unlike the Bush administration, Khouri went down to talk to the Hamas leadership in Beirut.

After hours of discussion, Khouri came away convinced of two things. First, given properly structured negotiations, Hamas will talk and compromise with Israelis. Second, that it is foolish to expect Hamas to foreswear the "principles" that got them elected in a free and fair vote. That second point may be distasteful, but, to paraphrase Khouri, that's bound to happen when you have two parties both convinced that God gave them the land. What is more, Khouri sees the elevation to power as a deeply moderating influence on Hamas, as it now has to produce the quality-of-life and anti-corruption results it promised.

What the White House is ignoring is that with Mahmoud Abbas still holding the presidency and Hamas holding the premiership, the Palestinian Authority for the first time represents most of the Palestinian people in the territories. The Bush administration and the previous Sharon government have argued that until they have a real partner for peace talks they will not negotiate. Therefore, they speciously argued, unilateral moves—like this past summer's withdrawal from Gaza and this week's Israeli announcement that it will annex as much as one third [4] of the West Bank—are necessary. Isolating this new government, unilaterally grabbing an enormous amount of territory, and having no intention of negotiating is tantamount to asking for a new—and more deadly—intifada. This time, however, with Arab populations angered throughout the region, an intifada may not stay exclusively a Palestinian affair.

Given the other major regional crises—over the European cartoons, Iraq's incipient civil war, and the West's confrontation with Iran over its nuclear facilities— it is hard to see how the interests of the White House will be served by trying to steamroll the Palestinian electorate. Even worse, now that the administration's plan has been leaked, the PLO would be idiots to think that they could play along with the U.S.-Israeli plot and contest an election fixed by America. Bush can only lose if he continues down this course.

The other headline, "U.S. Royalty Plan To Give Windfall To Oil Companies," is another example of Bush leading America further in the wrong direction. Beyond the breathtakingly bald raid on the U.S. Treasury, the move comes at a time when oil companies are posting record profits—in turn caused by the risk premium associated with Bush's ideological misadventure in the Persian Gulf. 

Byron Dorgan [5], Democratic senator from North Dakota, has in fact called for a tax on oil companies' windfall profits. That initiative speaks to the level of frustration Americas are having with Washington's inability to put the country on a sustainable energy course. Indeed, the latest report from the Financial Times [6], published yesterday, says that geopolitical instability and major underinvestment in oil production capacity will result in years of higher oil prices. And that's before we consider leading oil investment banker Matthew Simmons' thesis [7]  that Saudi oil has peaked.

While I agree with Sen. Dorgan's goals, my own sense is that tit-for-tat treasury raiding is more catharsis than solution. I'm not in any way defending the oil oligopoly, but I think a windfall profits tax is just another band-aid. The longer-term solution that I would prefer is to increase the royalties the U.S. government charges on oil and gas extraction in the first place. In other words, what we should be doing is the exact opposite of what President Bush just anounced. Currently, I estimate that the royalty charged by the government is about $2/barrel. Oil prices are today $61/barrel. It's time to capture some of that value for the American people. It is after all, our oil.

Bush's action on oil royalties is a great example of the lengths to which our nation will go to make it look like oil is inexpensive at the gas pump. Since 1980, America has fooled itself into thinking that it could preserve the cheap energy conditions that existed after World War II. The 1973 Arab-Israeli war changed that when Saudi Arabia used oil as a weapon against the United States. Now we are fighting a war in Iraq and preparing for a war with Iran while our energy policy gives oil production subsidies to the largest single industry on the planet. Indeed, we are truly addicted.

Taken together, the result of these two decisions portends deep trouble for America. Our energy crisis is getting worse while Bush's attempt to crush Hamas is a time bomb under the entire Middle East.

If there is one good thing in this news, however, it is that Bush is making it harder and harder for Democrats in 2008 to hold on to their current muddled positions on Palestinine and energy security. The only question is whether Republicans like McCain and Hagel can grab and hold a sane majority before the Democrats get their act together.