Workers World, Vol. 21, No. 29
July 17 – One would have thought that, after the press disclosed the contents of White House domestic adviser Eizenstat’s memorandum, in which he pleaded with Carter to blame OPEC for the oil and gas crisis and to use OPEC as a scapegoat to rally support for himself, Carter would have found it necessary in his nationwide television address last Sunday (July 15) to either repudiate the memo or at least to shy away from any further attack on OPEC. On the contrary. He virtually endorsed Eizenstat’s Big Lie.
“Our neck is stretched out over the fence. And OPEC has the knife.” In making this blatant and unprecedented attack on the oil-producing countries, Carter virtually adopted the Eizenstat strategy of making the oppressed people of the oil-producing countries the scapegoat for the woes, the chaos, the dislocation, and the suffering which the oil monopolies are daily inflicting on the mass of the people in the United States.
The people are saturated with an uninterrupted flow of propaganda to the effect that the OPEC price increases are the principal force for stoking the fires of worldwide inflation. The truth of the matter, however, is that worldwide inflation is now several decades old, and that the principal cause of the inflation arises from the existence of the worldwide capitalist monopolies. They are the real generators of inflation. OPEC’s price increases are a reaction to the rigged monopolist prices for industrial, technological and scientific products, which OPEC and the underdeveloped countries are dependent on from Western imperialism.
Moreover, one cannot but be struck by the conspicuous omission in the torrents of capitalist commentaries on Carter’s July 15 speech of any reference to Carter’s adoption of the fraudulent Eizenstat strategy. In fact, the capitalist press and media virtually ignored it and confined themselves to mere commentary on Carter’s domestic proposals for cutting oil imports, for alternative energy production, and for various other schemes presumed to stave off the crisis.
American workers have to ask themselves: How do workers in Saudi Arabia, Kuwait, Iraq, Iran, or any of the other oil-producing countries feel when they hear that their country is cast in the role of a scapegoat, is falsely and with deliberated calculation blamed for the crimes of the imperialist oil monopolies? The head of the U.S. government says that they hold a knife over the heads of the American people, but in truth reports culled from the American press show that day in and day out there are threats of military intervention to take over the oilfields, that the Pentagon on innumerable occasions has deliberately leaked plans about its unilateral military force that is said to be ready to pounce upon any or all of the Gulf states.
Furthermore, how must workers in any of the petroleum-producing countries feel when they read that putting the blame on OPEC is really a trick and a device to divert attention from the oil monopolies and the Carter administration, which works hand in glove with them?
There is scarcely a craft which has perfected the art of cynicism more than that of imperialist diplomacy. The Carter administration, however, raised the cynicism to a new and uglier dimension when, after Carter brazenly attacked OPEC in his July 15 talk, he had the U.S. State Department dispatch a diplomatic note to the Saudi Arabian government in which he said to please not take his speech too seriously, that it was what he had to do, and furthermore that he didn’t mean to blame Saudi Arabia as much as the other OPEC members.
What the State Department said to the other OPEC members was not disclosed. It is to be noted that the State Department thought it important enough to call its European and Japanese imperialist allies (and the People’s Republic of China!) for a secret briefing on the meaning and significance of Carter’s July 15 attack on OPEC.
In the ordinary course of relations between states, the kind of virulent attack that Carter made on a group of sovereign states would have called for some diplomatic retaliation. But alas, it is not the U.S. which is a “hostage of OPEC” as Carter falsely claims and as the capitalist media drum into the heads of the American people. It is unfortunately still the reverse.
The strength and power and influence of the oil-producing countries is vastly exaggerated. Their position must be understood in light of the ever-present military encirclement by U.S. and allied imperialist governments, who are no less predatory than the U.S. itself.
OPEC is composed of dependent countries, poor oppressed countries, whose recent achievements of sovereignty have in no way changed their basic relationship of dependence on imperialism. Political independence has not changed the relationship between the oppressing imperialist countries and the oppressed countries of the world as a whole. Nothing can be understood of world contemporary relationships if this is not borne in mind.
What reply did OPEC make to Carter’s speech, which was given worldwide front-page publicity everywhere? This country’s television networks did not carry any reply. And only a few of the leading capitalist papers made any mention of it. The New York Times buried it on the bottom of page 15, away from the more than three pages devoted to Carter’s speech and the commentaries and analysis of it. So far as the 60 million people who allegedly watched Carter’s speech, none heard a word of OPEC’s reply.
Yet aside from other considerations it contains some very significant revelations. “It should be noted,” it said, “that in 1974 the United States imported around one billion barrels of oil and in 1978 it was importing two billion barrels, which is 100 percent more than in 1974.” To the ordinary person who is besieged by a hundred-and-one different statistics about oil and imports, this may not have any meaning at all. But in truth, however, it speaks volumes. In the first place, the U.S. doesn’t deny this. The figures shows not only a tremendous, 100 percent increase from 1974 to 1978, but it points up a fact which is only to well-known, but deliberately omitted whenever discussion of the oil crisis comes up.
The period from 1974 to 1978 was a period of capitalist stagnation and recession. Certainly from 1974 to late 1976 not even the capitalist government itself denied the existence of a capitalist recession. Industrial production slumped and unemployment rose by as many as 8-10 million from 1974 to 1976. There are still some 8 million unemployed and another recession is virtually at the door, if it hasn’t already entered.
How then could there be such a tremendous increase in oil imports over and above 1974 if industrial production was declining? It is industry, after all, which consumes most of the oil. Passenger car production dropped, as did all other forms of industrial activity. How then was the oil used up? The fact of the matter is that only the oil monopolies themselves know where the oil went, over and above industrial use.
It is a fact that there is much hidden oil in the U.S. Only the oil companies know how much and they won’t tell the government. Carter says that he is sending out hundreds of auditors and investigators to find out. But they were supposed to have been on the job for years now. Carter said he will prosecute the oil companies for illegal conduct. But they have been prosecuted for decades. The prosecutions have never ended. It’s an ongoing, never-ending process without any real results.
Instead of putting the spotlight on the oil companies, the capitalist media are now focusing in on a variety of alternate forms of energy. Suddenly there is a mad drive on for synthetic fuels. Some are for coal liquefication and gasification. Others are for oil shale. Some are for extracting oil from tar sands.
The oil companies are involved in each of these synthetic projects if and when Carter and Congress begin pouring billions upon billions into them from his projected $140 billion proposal. For instance on the extraction of oil from coal, there are Gulf Oil, Southern Company, Exxon, and others, as well as American Natural Resources, and Conoco. In oil shale there are Occidental Petroleum, Union Oil, and others. In tar sands there is Exxon again, as well as Gulf and others.
There are a variety of other proposals for solar energy, for instance. But all of these proposals, whatever their merits, are predicated on the continued existence of the monopolies, particularly the oil monopolies and the huge banking combines with whom they are coalesced inextricably and indissolubly.
It is impossible to make an honest proposal for the solution of the gas and oil crisis as long as the basic monopolies, particularly the oil monopolies, are permitted free rein by the capitalist government, as they have been for almost a hundred years. Each succeeding administration for almost a century has grappled with the oil companies. Splitting them up, bisecting them, trisecting them, or limiting them to certain spheres of activity has in no way impeded them from not only invading and taking over every vital artery of this vast and vital industry, from well-head to the pump, but also exercising a decisive role in the succeeding administrations of the U.S. government.
Whether one is a proponent of solar energy, thermal energy, synthetic fuels, or what-not, there can be no true, real, honest alternative of a practical character which does not include a complete and thorough takeover of the oil companies. They must be taken out of the hands of the small clique of avaricious monopolists and put into the hands of the people. All other measures in the final analysis serve to strengthen the monopolies.
More than 60 years ago the U.S. Supreme Court, in what was regarded as a landmark decision, broke up the Standard Oil Company as a trust. It did not stop the growth of the oil monopolies nor did it stop them from conspiring together against the people by rigging prices, sharing markets, and controlling vast sources of untapped and unexplored oil beneath the surface. Carter’s measures against the oil companies are the weakest of any administration and can be scarcely regarded as anything but a boon to them in reality, even as he carries out sham attacks against them, as he did in the CWA convention in Detroit only yesterday.
Last updated: 11 May 2026