The authors of "Oil, Dollars, Debt, and Crises: The Global Curse of Black Gold" (ODDC) set out a modest goal with this book, and I think they hit it. "Very little that we have reviewed in this book will come as a surprise to the informed reader," the authors begin the conclusion, continuing that "energy prices, the regulation of financial markets and institutions, and international relations as they pertain to Middle East geopolitics are so closely intertwined" that they have to be viewed together. These statements are certainly true, and ODDC, intended as a guide to basic issues more than an answer to specific questions or an argument for anything, hits its target. I've deducted one star for mistakes related to regional politics, but neither author is a regional specialist and that isn't the core of the book.
The authors make no grand argument aside from the point about intercorrelation, but lots of smaller arguments on specific issues, and in some cases they simply raise a topic, present the views of various experts on it, and then move on. That the oil boom of the 1970s helped contribute to the Latin American debt crisis of the 1980s is well known; ODDC makes the further argument the oil resurgence in the 2003-2008 period helped fuel the bubble economy in the UAE, the white elephant "economic cities" of Saudi Arabia, and the Islamic finance fad. And of course the U.S. Fed is part of the problem - Greenspan's easy money policies weakened the dollar, thus contributing to artificially high oil prices, and this in turn fueled an oil boom that circled back into the real economy through the global project finance equivalent of the subprime mortgage industry.
ODDC covers virtually every angle but sometimes makes them so superficially as to not be helpful. For example, where the authors discuss the "Return of the `Oil Weapon' Possibility" on page 160, they mention that Venezuela and Iran have rhetorically threatened to cut off oil supplies for political reasons, but just throw the possibility out there without noting that Iran's economy would collapse, and its government be overthrown, if Tehran ever tried that.
The book's title doesn't mention the Middle East and this book is as much a global finance and oil book as anything, but much of it is about the Middle East. Chapters two, three and four are essentially about regional geopolitics and economics.
The authors are not regional specialists, though, and it shows. One page 65-66: "...Al-Qa'ida - "the base" or "the launching pad," established in 1988 to support the Afghani Mujahedeen in their fight the Soviet Union, with the full blessings of the United States and Saudi Arabia." Two mistakes here - first, they repeat the myth that the U.S. supported Osama bin Laden in the 1980s. Actually, the U.S. gave money and weapons to Pakistani intelligence, which supported some radical Afghan groups which later allied themselves with AQ, but the US barely understood this at the time, and never supported AQ. Second, AQ was NOT founded to fight the Soviet Union - it was founded as that war was winding down by the "Arab Afghans," always marginal to the anti-Soviet war, who were looking to expand into global jihad. The authors cite as a source Steve Coll's "Ghost Wars," but they didn't read it very carefully. Coll states categorically on page 87 that there is no evidence the U.S. ever supported AQ; in fact CIA wasn't even aware of Bin Laden for most of the war.
Another whopper appears on page 90: "After the 1979 revolution, Iran's Islamist government backed Iraqi Shia that opposed the rule of Saddam Hussein and was linked to a plot to seize the Grand Mosque in Makkah." Whoa - this is what the Saudis and the Carter Administration mistakenly believed at the time. It has long been clear that Juhayman Otaybi's takeover of the Mecca Mosque was a purely internal revolt by Wahhabi-influenced opponents of Saudi modernization. Read Yaroslav Trofimov's "The Siege of Mecca" for example.
There are some other regional judgments which are debatable, although not so clearly wrong in terms of basic facts. Without taking up more space on this review than justified for a peripheral topic, I suggest skipping the regional politics segments on pp. 38-40 and 68-70. For example, the claim on page 70 that what they label "sociopolitical groups that adopt an Islamist program" become militant movements due to lack of democracy is certainly contrary to the history of the most important one, the Muslim Brotherhood, and its offshoot, Hamas. The argument is at least possible for Algeria's Islamic Salvation Front, but even there I doubt it.
In the authors' area of specialization, though, ODDC is on firmer ground, and probably worth reading for a more integrated understanding of Middle East political economy and the global financial system.
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