Why The Market Doesn't Buy Peace; powerplay; Ian Macwhirter condemns

IT was the Prussian military strategist Carl von Clausewitz who said that war is merely a continuation of politics by other means. Nowadays, war looks increasingly like a continuation of economics by other means. I cannot recall a war in modern times in which business, in particular the oil business, has played such a nakedly prominent role as it is doing in the coming war against Iraq.

Of course, economic advantage has always been a factor in war; the first world war was largely a product of industrial rivalry and the dash for control of colonial markets. But in most modern-day conflicts - the second world war, Vietnam, Kosovo - war has been justified in moral terms. To legitimise war in a democracy, I was taught at university, there had to be great issues of principle at stake: the need to combat fascism, contain communism, stop ethnic cleansing, defend national sovereignty. Even the 1991 Gulf war was an international coalition of free nations seeking to restore the borders of a country - Kuwait - that had been invaded, in defiance of international law, by Iraq.

Gulf war II is different. Law really doesn't come into it. There is no great universal principle at stake, except American self- interest. There has been no particular attempt to enlist public opinion to a moral cause. Consequently, there is widespread opposition to it on both sides of the Atlantic. America's pretext for war is weak and unconvincing - but the White House doesn't seem to care.

The Iraq war is ostensibly about combating terrorism and ending the proliferation of weapons of mass destruction. We are promised new evidence this week of Saddam Hussein's links with international terror. But nobody seriously believes that Saddam Hussein was behind the twin towers atrocity, or that he poses any immediate threat to America or Britain, certainly while UN weapons inspectors are still in Iraq. Other countries, such as China, Pakistan and North Korea, have nuclear weapons but America has made clear that they are not on the target list. George W Bush has shown no interest in removing other dictators unless they threaten American interests.

Iraq is not about freedom or democracy. This particular rogue state has been fingered for retribution largely because it has the world's second largest reserve of crude oil. George Bush is an oil man, like his daddy, as are many of his top advisers, such as vice- president Dick Cheney. Defence secretary Donald Rumsfeld talks openly about how Iraqi oil will be "liberated".

As this paper revealed last week, much of the wrangling between the US and European countries such as France has been over how to divvy up Iraq's reserves when they are held "in trust" for the nation.

We've been told that the need for speed is to avoid the harsh Arab summer heat. But an early invasion is less to do with the weather, and more to do with the state of the markets.

A quick defeat of Saddam will, it is hoped, cut the price of oil and kick-start the global economy. The war will use up a lot of expensive weaponry and boost the armaments industry. It will restore investor confidence in America, severely battered recently by the slide in the dollar, and affirm America's global supremacy.

Nobody in America seems particularly embarrassed at this. War is openly talked about as a strategy for economic recovery. The right- wing American columnist, Irwin Stelzer, a confidante both of Rupert Murdoch and Tony Blair, is in no doubt about what's needed. "The best thing the politicians can do," he said last weekend in The Sunday Times, "is to eliminate uncertainty and get on with the war, winning it quickly and opening Iraq's oil industry to new investment. That would be a real stimulus package." Now, call me naive, but I cannot recall an influential voice ever expressing quite such a blatantly mercenary case for killing thousands of people.

Of course, American foreign policy isn't dictated by the stock market - at least not directly. But it's becoming increasingly clear that international economic recession is as much a "real and present danger" as international terror. And war is the solution. The British stock market has halved in the last three years since the Great Millennium Crash. There seems no likelihood of the market slide stopping until Saddam Hussein is toppled. If the uncertainty continues, the insurance companies will effectively become bankrupt, ruining the pensions of millions of people and undermining the financial system.

The Chancellor, Gordon Brown, already looking at an (pounds) 11 billion fiscal hole, according to the Institute for Fiscal Studies, will have to slash public spending or increase taxes. Cynics might suspect Mr Brown's recent conversion to the war party is because he realises that, if the war isn't over quickly, his reputation as Labour's most successful chancellor ever could be the first casualty.

Self-interest rules. Tony Blair is quite openly vying to become the leader of the "new" Europe, composed of the right-leaning Iberian nations plus eastern European countries such as Poland. This could be the nucleus of a new free-market, pro-American Europe, which would undermine the Franco-German axis in the EU. The stakes are high, and Blair is hoping that who dares wins.

Assuming Saddam Hussein does not suddenly submit, two things are certain: America will win the war in March; and the stock market will rise the day after Saddam falls. That much is already written into the script. What happens after that is a little less clear. France and Germany warn that, while it will be relatively easy for the world's military superpower to defeat Iraq's armed forces, it will be much harder to win the peace. The country might fall apart into ethnic fragments. The sight of a Christian country invading a nominally Islamic one will likely unleash a new Islamic terror campaign.

But such a scenario is a little beyond George W Bush's event horizon. A quick victory will almost guarantee his re-election as President in 2004. That's the bottom line. This is a conflict without any particular moral justification. Everyone's out for what they can get. It's not surprising that 80% of the population of Britain don't want this war. Moral mobilisation of the people seems to be optional. It is almost as if we have returned to the 19th century when countries went to war with each other quite openly to seek economic or political advantage.

Perhaps this development has something to do with the changing character of war. In the last century, the century of total war, it was necessary to mobilise huge armies capable of sustaining vast casualties. To meet the hardship and the human cost of total war, entire societies had to be dedicated to fighting them. The morale of the entire nation became a crucial factor.

Now, we are in the age of casualty-free conflict. More Americans were killed by "friendly fire" in the Gulf war than were killed by Saddam's soldiers. America's massive military might has given its leaders the tantalising option of instant war.

In the new imperialism, nobody bothers to justify conflict too much. Whoever is in power calls the shots - and fires them.

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