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Greenspan says Iraq war is ‘about oil’

September 18, 2007


WASHINGTON, Sept 17: Alan Greenspan — the former chief of the US central bank, for years an inscrutable seer on the economy — has outraged the Bush administration by alleging in his new memoir that “the Iraq war is largely about oil.”

Mr Greenspan, who as head of the Federal Reserve, was famous for his tight-lipped reserve, is uncharacteristically direct, also accusing President George Bush of abandoning Republican principles on the economy.

“I’m saddened that it is politically inconvenient to acknowledge what everyone knows — the Iraq war is largely about oil,” he wrote in reported excerpts of “The Age of Turbulence: Adventures in a New World,” which hit bookstores on Monday.

However, in an interview with The Washington Post, Mr Greenspan clarified that while securing global oil supplies was “not the administration’s motive,” it had presented the White House with an opportunity to make the case that removing Saddam Hussein was important for the global economy.

“I was not saying that that’s the administration’s motive,” he said in the interview. “I’m just saying that if somebody asked me, ‘Are we fortunate in taking out Saddam?’ I would say it was essential.”

Mr Greenspan’s memoir appears 18 months after he left the Fed, following a career that spanned 1987 to 2006, with the US economy at a crossroads and ahead of a critical central bank meeting under the chairmanship of his successor, Ben Bernanke.

The man dubbed “The Oracle” tells his own tale of nearly two decades at the helm of one of the world’s most powerful financial institutions and includes surprising swipes at the Bush administration.

Defence Secretary Robert Gates, while explaining his “respect” for Greenspan, rejected the charge that a thirst for crude explained the decision to invade Iraq in March 2003.

“I know the same allegation was made about the Gulf War in 1991, and I just don’t believe it’s true,” he said on ABC television.

Members of the US Congress, who by a broad majority also voted to authorise the use of military force against Iraq, also dismissed Mr Greenspan’s assertion.

“I don’t believe that 77 United States senators on a broad, bipartisan basis would have authorised the use of force... if it was only about oil,” Republican senator John Cornyn told CNN.

ECONOMY: Greenspan, a lifelong Republican, writes that he advised the White House to veto some bills to curb “out-of-control” spending while the Republicans controlled Congress.

According to The Wall Street Journal, he says that Bush’s failure to do so “was a major mistake.”

Republicans in Congress, he writes, “swapped principle for power. They ended up with neither. They deserved to lose” in the 2006 elections when the Democrats retook control of Congress, he adds.

A speech by the 81-year-old Greenspan is said to command more than 100,000 dollars, and he reportedly earned an 8.5-million-dollar advance from Penguin Press for the book.

In the bombshell memoir, he puts his own spin on the events surrounding the 1987 stock market crash, the bursting of the Internet bubble and the 2001 recession coinciding with the Sept 11 strikes.—AFP