Categorized | USA, South America

Why normalize relations with Cuba now?

NOVANEWS

The simple answer: to destroy socialist Cuba, break up the ALBA nations, and hurt Russia, Iran, and Venezuela.

Let’s explain how this works…

Oil prices have fallen by half since late June 2014.

Reason: neo-liberalism is sustaining a permanent global depression. As a result, demand for oil is down, especially in China, Japan, and Europe.

Meanwhile the supply of oil is up, because domestic supplies are increasing—almost entirely caused by the frantic pace of drilling in “tight” oil fields in North Dakota and Texas, using hydro-fracturing (“fracking”) and horizontal drilling technologies.

Usually when there is a mismatch between supply and demand in the global crude oil market, it is up to Saudi Arabia—the world’s top exporter—to reduce or increase production in order to stabilize prices. However in Sep 2014, John Kerry asked King Abdullah to maintain production, and to cut prices to customers in Asia. Kerry did this to hurt Russia, Iran, and Venezuela. (More about that below.)

A cut in prices would normally stimulate an economy, but not in the age of neo-liberalism, where Wall Street (i.e. the financial economy) takes precedence over Main Street (i.e. the real economy).

Main Street needs oil. Wall Street does not. Wall Street’s casino capitalism is an abstract game of making money from money. Wall Street thrives while Main Street dies. Hence there is no demand for oil.

This is why low oil prices have not boosted the USA’s real economy. Unemployment remains high, and the people that still have jobs are paid dirt wages. Activity on Main Street is down (because of neo-liberalism). Therefore the demand for energy is down.

The fall in oil process has made it unprofitable to extract oil from Texas and North Dakota. As these operations wind down, scarcity will return, and oil prices will climb once again. Then oil companies will resume extracting oil from Texas and North Dakota.

Therefore the time for the USA to act is NOW, while oil prices are temporarily down, and Russia, Iran, and Venezuela are hurting. These nations depend on oil revenue, because they need foreign currency, because importers want to be paid in foreign currency (e.g. dollars or euros).
Importers do not want to be paid in the local currency of Iran, Russia, or Venezuela.

The USA does not need foreign currency, since the dollar is accepted worldwide. If the dollar were not accepted outside the USA, then America’s hundred-billion-dollar trade deficit would instantly (as in overnight) destroy America as we know it. The USA would suddenly have to become self-sufficient, or else break up into pieces.

Corporate media outlets claim that oil prices are down because there is an “oil glut.”  This is false. World oil production peaked in 2005, and has been declining ever since. Oil prices are temporarily down because demand is falling much faster than supply.

Some people say the Saudis are causing the fall in oil process. Again, this is false. The Saudis are only one factor. The real cause is a fall in demand (caused by global neo-liberalism) combined with a temporary increase in supply. If the Saudis were to cut production in order to increase scarcity, and thereby boost prices, it would make little difference, since Main Street is dead. Thus, Main Street would not demand oil. Thus, oil process would not rise.

Only Wall Street is hopping, and Wall Street does not need oil. (“Wall Street” means casino capitalism wherever it occurs in the world.)

Here is another falsehood: “More than 50% of Russian state revenue comes from its export sales of oil and gas.” Wrong. In terms of domestic revenue (rubles) the Russian government doesn’t need any. It can create as many rubles as it likes out of thin air. What Russia needs is foreign currency, in order to pay for imports of food, and so forth.

The fall in oil prices has reduced the profits of oil companies, but they don’t care. They are sitting on mountains of cash. To hurt Russia, Iran, and Venezuela, they can afford to temporarily make only $500 billion in profits, rather than $600 billion.

CUBA

Venezuela has sent cheap oil to Cuba since Chavez became president, and the fall in oil prices will not affect this.

In return, Venezuela benefits from thousands of Cuban doctors and engineers that come to Venezuela.

Venezuela has a lot of oil (the largest reserves in the world). Therefore Venezuela has enjoyed a plentiful influx of foreign currency. However this has caused native non-petroleum-related industries to atrophy in Venezuela. Venezuela must import most of its food, cars, etc. This is no problem as long as oil prices remain high, since Venezuela can pay for all imports. But when oil prices fall, Venezuela runs short of foreign currency, and cannot buy imports. Venezuela starves.

Meanwhile the corrupt bond rating agencies (Fitch, Moody’s and S&P) have suddenly and arbitrarily downgraded Venezuela’s sovereign bonds. As a result, Venezuela cannot get foreign currency by borrowing it (through the selling of bonds). This is intentional.

To repeat, Venezuela cannot get foreign currency (to buy imports) by borrowing it, or by selling oil. Venezuela is under an economic blockade.

Simultaneously Venezuela suffers from high inflation. This is the result of an economic war being waged by Venezuela’s rich oligarchs against Venezuela’s government and people. The oligarchs drive up local prices by reducing local production, and by hoarding foodstuffs and consumer goods. This is illegal, and the government tries to stop it, but it’s a cat-and-mouse game. The oligarchs are constantly moving things around and falsifying their records in order to stay one step ahead of the government while maintaining high prices. The purpose is to make Venezuela’s masses scream in pain, and call for a new government (ruled by the oligarchs).

When the oligarchs make war on you, and they have outside help, they can only be defeated by putting them in prison and taking over the means of production.  Thus, to defeat the oligarchs, Venezuela’s government would have to go communist or National Socialist — either of which would bring an instant military attack from the entire Western world. It would be Libya II.

Despite the war by the oligarchs, with their engineered scarcity, Venezuela was able to keep buying imports as long as oil prices were high, since Venezuela’s government could get foreign currency. But now that oil prices are down, and Venezuela’s supply of foreign currency is drying up, the oligarchs’ war is devastating.

Cuba will continue to get Venezuelan oil, but that is not enough. Cuba also needs to import food. For that, Cuba needs foreign currency. Venezuela has no foreign currency to give it, since oil prices are down.

Neither Venezuela nor Cuba can print their own currencies out of thin air are use it to pay for imports, since importers will not accept those currencies as payment. Foreign importers want to be paid in dollars, or euros, or British pounds. When you send 10,000 cars to Venezuela, you want to be paid in dollars that you can spend anywhere in the world. You do not want to be paid in bolivar fuertes that you can only spend in Venezuela.

Cuba’s economy is in trouble, since Cuba can no longer get help from Venezuela’s government, other than oil imports. Thus, Cuba is forced to start talking to Washington, whose sudden recognition of Cuba is a wedge between Cuba and Venezuela. It is designed to break up the ALBA nations. The USA must do this NOW, before oil prices go back up.

Washington’s recognition of Cuba will not stop at building an embassy in Havana. Washington will shower Cuba’s top politicians with money, thereby creating an instant and permanent addiction to money and power. Cuba’s politicians will want more. Always more.

In other words, once Cuba is corrupted, there will be no going back. Cuba will turn away from Venezuela, and will enter the globalist club. Everything gained from the revolution will be lost. Cuba will become Mexico, or even Honduras. A playground for the rich, and a nightmare for the natives.

All the corporate bigwigs understand what I have just described above. That’s why they are circling Cuba like vultures. Within a year, Cuba will be overrun with Israeli tourists. Synagogues and “holocaust”™ museums will spring up like weeds. (At present, Cuba only has about 2,000 native Jews.) Cuba’s finance minister and central bank head will be Jews.

It’s over folks. I’m sorry to be so negative, but I’ve seen this movie many times, and the ending is always the same.

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